94TH GENERAL ASSEMBLY
State of Illinois
2005 and 2006
SB0764

 

Introduced 2/18/2005, by Sen. John J. Cullerton

 

SYNOPSIS AS INTRODUCED:
 
765 ILCS 605/9.2   from Ch. 30, par. 309.2
765 ILCS 605/18.5   from Ch. 30, par. 318.5

    Amends the Condominium Property Act. Provides that, other than attorney's fees, no fees pertaining to the collection of a unit owner's financial obligation to the Association, including fees charged by a manager or managing agent, shall be added to and deemed a part of an owner's respective share of the common expenses.


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A BILL FOR

 

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1     AN ACT concerning property.
 
2     Be it enacted by the People of the State of Illinois,
3 represented in the General Assembly:
 
4     Section 5. The Condominium Property Act is amended by
5 changing Sections 9.2 and 18.5 as follows:
 
6     (765 ILCS 605/9.2)  (from Ch. 30, par. 309.2)
7     Sec. 9.2. Other remedies.
8     (a) In the event of any default by any unit owner, his
9 tenant, invitee or guest in the performance of his obligations
10 under this Act or under the declaration, bylaws, or the rules
11 and regulations of the board of managers, the board of managers
12 or its agents shall have such rights and remedies as provided
13 in the Act or condominium instruments including the right to
14 maintain an action for possession against such defaulting unit
15 owner or his tenant for the benefit of all the other unit
16 owners in the manner prescribed by Article IX of the Code of
17 Civil Procedure.
18     (b) Any attorneys' fees incurred by the Association arising
19 out of a default by any unit owner, his tenant, invitee or
20 guest in the performance of any of the provisions of the
21 condominium instruments, rules and regulations or any
22 applicable statute or ordinance shall be added to, and deemed a
23 part of, his respective share of the common expense.
24     (c) Other than attorney's fees, no fees pertaining to the
25 collection of a unit owner's financial obligation to the
26 Association, including fees charged by a manager or managing
27 agent, shall be added to and deemed a part of an owner's
28 respective share of the common expenses.
29 (Source: P.A. 88-417.)
 
30     (765 ILCS 605/18.5)  (from Ch. 30, par. 318.5)
31     Sec. 18.5. Master Associations.

 

 

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1     (a) If the declaration, other condominium instrument, or
2 other duly recorded covenants provide that any of the powers of
3 the unit owners associations are to be exercised by or may be
4 delegated to a nonprofit corporation or unincorporated
5 association that exercises those or other powers on behalf of
6 one or more condominiums, or for the benefit of the unit owners
7 of one or more condominiums, such corporation or association
8 shall be a master association.
9     (b) There shall be included in the declaration, other
10 condominium instruments, or other duly recorded covenants
11 establishing the powers and duties of the master association
12 the provisions set forth in subsections (c) through (h).
13     In interpreting subsections (c) through (h), the courts
14 should interpret these provisions so that they are interpreted
15 consistently with the similar parallel provisions found in
16 other parts of this Act.
17     (c) Meetings and finances.
18         (1) Each unit owner of a condominium subject to the
19     authority of the board of the master association shall
20     receive, at least 30 days prior to the adoption thereof by
21     the board of the master association, a copy of the proposed
22     annual budget.
23         (2) The board of the master association shall annually
24     supply to all unit owners of condominiums subject to the
25     authority of the board of the master association an
26     itemized accounting of the common expenses for the
27     preceding year actually incurred or paid, together with a
28     tabulation of the amounts collected pursuant to the budget
29     or assessment, and showing the net excess or deficit of
30     income over expenditures plus reserves.
31         (3) Each unit owner of a condominium subject to the
32     authority of the board of the master association shall
33     receive written notice mailed or delivered no less than 10
34     and no more than 30 days prior to any meeting of the board
35     of the master association concerning the adoption of the
36     proposed annual budget or any increase in the budget, or

 

 

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1     establishment of an assessment.
2         (4) Meetings of the board of the master association
3     shall be open to any unit owner in a condominium subject to
4     the authority of the board of the master association,
5     except for the portion of any meeting held:
6             (A) to discuss litigation when an action against or
7         on behalf of the particular master association has been
8         filed and is pending in a court or administrative
9         tribunal, or when the board of the master association
10         finds that such an action is probable or imminent,
11             (B) to consider information regarding appointment,
12         employment or dismissal of an employee, or
13             (C) to discuss violations of rules and regulations
14         of the master association or unpaid common expenses
15         owed to the master association.
16     Any vote on these matters shall be taken at a meeting or
17     portion thereof open to any unit owner of a condominium
18     subject to the authority of the master association.
19         Any unit owner may record the proceedings at meetings
20     required to be open by this Act by tape, film or other
21     means; the board may prescribe reasonable rules and
22     regulations to govern the right to make such recordings.
23     Notice of meetings shall be mailed or delivered at least 48
24     hours prior thereto, unless a written waiver of such notice
25     is signed by the persons entitled to notice before the
26     meeting is convened. Copies of notices of meetings of the
27     board of the master association shall be posted in
28     entranceways, elevators, or other conspicuous places in
29     the condominium at least 48 hours prior to the meeting of
30     the board of the master association. Where there is no
31     common entranceway for 7 or more units, the board of the
32     master association may designate one or more locations in
33     the proximity of these units where the notices of meetings
34     shall be posted.
35         (5) If the declaration provides for election by unit
36     owners of members of the board of directors in the event of

 

 

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1     a resale of a unit in the master association, the purchaser
2     of a unit from a seller other than the developer pursuant
3     to an installment contract for purchase shall, during such
4     times as he or she resides in the unit, be counted toward a
5     quorum for purposes of election of members of the board of
6     directors at any meeting of the unit owners called for
7     purposes of electing members of the board, and shall have
8     the right to vote for the election of members of the board
9     of directors and to be elected to and serve on the board of
10     directors unless the seller expressly retains in writing
11     any or all of those rights. In no event may the seller and
12     purchaser both be counted toward a quorum, be permitted to
13     vote for a particular office, or be elected and serve on
14     the board. Satisfactory evidence of the installment
15     contract shall be made available to the association or its
16     agents. For purposes of this subsection, "installment
17     contract" shall have the same meaning as set forth in
18     subsection (e) of Section 1 of the Dwelling Unit
19     Installment Contract Act.
20         (6) The board of the master association shall have the
21     authority to establish and maintain a system of master
22     metering of public utility services and to collect payments
23     in connection therewith, subject to the requirements of the
24     Tenant Utility Payment Disclosure Act.
25         (7) The board of the master association or a common
26     interest community association shall have the power, after
27     notice and an opportunity to be heard, to levy and collect
28     reasonable fines from members for violations of the
29     declaration, bylaws, and rules and regulations of the
30     master association or the common interest community
31     association. Nothing contained in this subdivision (7)
32     shall give rise to a statutory lien for unpaid fines.
33         (8) Other than attorney's fees, no fees pertaining to
34     the collection of a unit owner's financial obligation to
35     the Association, including fees charged by a manager or
36     managing agent, shall be added to and deemed a part of an

 

 

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1     owner's respective share of the common expenses.
2     (d) Records.
3         (1) The board of the master association shall maintain
4     the following records of the association and make them
5     available for examination and copying at convenient hours
6     of weekdays by any unit owners in a condominium subject to
7     the authority of the board or their mortgagees and their
8     duly authorized agents or attorneys:
9             (i) Copies of the recorded declaration, other
10         condominium instruments, other duly recorded covenants
11         and bylaws and any amendments, articles of
12         incorporation of the master association, annual
13         reports and any rules and regulations adopted by the
14         master association or its board shall be available.
15         Prior to the organization of the master association,
16         the developer shall maintain and make available the
17         records set forth in this subdivision (d)(1) for
18         examination and copying.
19             (ii) Detailed and accurate records in
20         chronological order of the receipts and expenditures
21         affecting the common areas, specifying and itemizing
22         the maintenance and repair expenses of the common areas
23         and any other expenses incurred, and copies of all
24         contracts, leases, or other agreements entered into by
25         the master association, shall be maintained.
26             (iii) The minutes of all meetings of the master
27         association and the board of the master association
28         shall be maintained for not less than 7 years.
29             (iv) Ballots and proxies related thereto, if any,
30         for any election held for the board of the master
31         association and for any other matters voted on by the
32         unit owners shall be maintained for not less than one
33         year.
34             (v) Such other records of the master association as
35         are available for inspection by members of a
36         not-for-profit corporation pursuant to Section 107.75

 

 

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1         of the General Not For Profit Corporation Act of 1986
2         shall be maintained.
3             (vi) With respect to units owned by a land trust,
4         if a trustee designates in writing a person to cast
5         votes on behalf of the unit owner, the designation
6         shall remain in effect until a subsequent document is
7         filed with the association.
8         (2) Where a request for records under this subsection
9     is made in writing to the board of managers or its agent,
10     failure to provide the requested record or to respond
11     within 30 days shall be deemed a denial by the board of
12     directors.
13         (3) A reasonable fee may be charged by the master
14     association or its board for the cost of copying.
15         (4) If the board of directors fails to provide records
16     properly requested under subdivision (d)(1) within the
17     time period provided in subdivision (d)(2), the unit owner
18     may seek appropriate relief, including an award of
19     attorney's fees and costs.
20     (e) The board of directors shall have standing and capacity
21 to act in a representative capacity in relation to matters
22 involving the common areas of the master association or more
23 than one unit, on behalf of the unit owners as their interests
24 may appear.
25     (f) Administration of property prior to election of the
26 initial board of directors.
27         (1) Until the election, by the unit owners or the
28     boards of managers of the underlying condominium
29     associations, of the initial board of directors of a master
30     association whose declaration is recorded on or after
31     August 10, 1990, the same rights, titles, powers,
32     privileges, trusts, duties and obligations that are vested
33     in or imposed upon the board of directors by this Act or in
34     the declaration or other duly recorded covenant shall be
35     held and performed by the developer.
36         (2) The election of the initial board of directors of a

 

 

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1     master association whose declaration is recorded on or
2     after August 10, 1990, by the unit owners or the boards of
3     managers of the underlying condominium associations, shall
4     be held not later than 60 days after the conveyance by the
5     developer of 75% of the units, or 3 years after the
6     recording of the declaration, whichever is earlier. The
7     developer shall give at least 21 days notice of the meeting
8     to elect the initial board of directors and shall upon
9     request provide to any unit owner, within 3 working days of
10     the request, the names, addresses, and weighted vote of
11     each unit owner entitled to vote at the meeting. Any unit
12     owner shall upon receipt of the request be provided with
13     the same information, within 10 days of the request, with
14     respect to each subsequent meeting to elect members of the
15     board of directors.
16         (3) If the initial board of directors of a master
17     association whose declaration is recorded on or after
18     August 10, 1990 is not elected by the unit owners or the
19     members of the underlying condominium association board of
20     managers at the time established in subdivision (f)(2), the
21     developer shall continue in office for a period of 30 days,
22     whereupon written notice of his resignation shall be sent
23     to all of the unit owners or members of the underlying
24     condominium board of managers entitled to vote at an
25     election for members of the board of directors.
26         (4) Within 60 days following the election of a majority
27     of the board of directors, other than the developer, by
28     unit owners, the developer shall deliver to the board of
29     directors:
30             (i) All original documents as recorded or filed
31         pertaining to the property, its administration, and
32         the association, such as the declaration, articles of
33         incorporation, other instruments, annual reports,
34         minutes, rules and regulations, and contracts, leases,
35         or other agreements entered into by the association. If
36         any original documents are unavailable, a copy may be

 

 

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1         provided if certified by affidavit of the developer, or
2         an officer or agent of the developer, as being a
3         complete copy of the actual document recorded or filed.
4             (ii) A detailed accounting by the developer,
5         setting forth the source and nature of receipts and
6         expenditures in connection with the management,
7         maintenance and operation of the property, copies of
8         all insurance policies, and a list of any loans or
9         advances to the association which are outstanding.
10             (iii) Association funds, which shall have been at
11         all times segregated from any other moneys of the
12         developer.
13             (iv) A schedule of all real or personal property,
14         equipment and fixtures belonging to the association,
15         including documents transferring the property,
16         warranties, if any, for all real and personal property
17         and equipment, deeds, title insurance policies, and
18         all tax bills.
19             (v) A list of all litigation, administrative
20         action and arbitrations involving the association, any
21         notices of governmental bodies involving actions taken
22         or which may be taken concerning the association,
23         engineering and architectural drawings and
24         specifications as approved by any governmental
25         authority, all other documents filed with any other
26         governmental authority, all governmental certificates,
27         correspondence involving enforcement of any
28         association requirements, copies of any documents
29         relating to disputes involving unit owners, and
30         originals of all documents relating to everything
31         listed in this subparagraph.
32             (vi) If the developer fails to fully comply with
33         this paragraph (4) within the 60 days provided and
34         fails to fully comply within 10 days of written demand
35         mailed by registered or certified mail to his or her
36         last known address, the board may bring an action to

 

 

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1         compel compliance with this paragraph (4). If the court
2         finds that any of the required deliveries were not made
3         within the required period, the board shall be entitled
4         to recover its reasonable attorneys' fees and costs
5         incurred from and after the date of expiration of the
6         10 day demand.
7         (5) With respect to any master association whose
8     declaration is recorded on or after August 10, 1990, any
9     contract, lease, or other agreement made prior to the
10     election of a majority of the board of directors other than
11     the developer by or on behalf of unit owners or underlying
12     condominium associations, the association or the board of
13     directors, which extends for a period of more than 2 years
14     from the recording of the declaration, shall be subject to
15     cancellation by more than 1/2 of the votes of the unit
16     owners, other than the developer, cast at a special meeting
17     of members called for that purpose during a period of 90
18     days prior to the expiration of the 2 year period if the
19     board of managers is elected by the unit owners, otherwise
20     by more than 1/2 of the underlying condominium board of
21     managers. At least 60 days prior to the expiration of the 2
22     year period, the board of directors, or, if the board is
23     still under developer control, then the board of managers
24     or the developer shall send notice to every unit owner or
25     underlying condominium board of managers, notifying them
26     of this provision, of what contracts, leases and other
27     agreements are affected, and of the procedure for calling a
28     meeting of the unit owners or for action by the underlying
29     condominium board of managers for the purpose of acting to
30     terminate such contracts, leases or other agreements.
31     During the 90 day period the other party to the contract,
32     lease, or other agreement shall also have the right of
33     cancellation.
34         (6) The statute of limitations for any actions in law
35     or equity which the master association may bring shall not
36     begin to run until the unit owners or underlying

 

 

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1     condominium board of managers have elected a majority of
2     the members of the board of directors.
3     (g) In the event of any resale of a unit in a master
4 association by a unit owner other than the developer, the owner
5 shall obtain from the board of directors and shall make
6 available for inspection to the prospective purchaser, upon
7 demand, the following:
8         (1) A copy of the declaration, other instruments and
9     any rules and regulations.
10         (2) A statement of any liens, including a statement of
11     the account of the unit setting forth the amounts of unpaid
12     assessments and other charges due and owing.
13         (3) A statement of any capital expenditures
14     anticipated by the association within the current or
15     succeeding 2 fiscal years.
16         (4) A statement of the status and amount of any reserve
17     for replacement fund and any portion of such fund earmarked
18     for any specified project by the board of directors.
19         (5) A copy of the statement of financial condition of
20     the association for the last fiscal year for which such a
21     statement is available.
22         (6) A statement of the status of any pending suits or
23     judgments in which the association is a party.
24         (7) A statement setting forth what insurance coverage
25     is provided for all unit owners by the association.
26         (8) A statement that any improvements or alterations
27     made to the unit, or any part of the common areas assigned
28     thereto, by the prior unit owner are in good faith believed
29     to be in compliance with the declaration of the master
30     association.
31     The principal officer of the unit owner's association or
32 such other officer as is specifically designated shall furnish
33 the above information when requested to do so in writing,
34 within 30 days of receiving the request.
35     A reasonable fee covering the direct out-of-pocket cost of
36 copying and providing such information may be charged by the

 

 

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1 association or its board of directors to the unit seller for
2 providing the information.
3     (h) Errors and omissions.
4         (1) If there is an omission or error in the declaration
5     or other instrument of the master association, the master
6     association may correct the error or omission by an
7     amendment to the declaration or other instrument, as may be
8     required to conform it to this Act, to any other applicable
9     statute, or to the declaration. The amendment shall be
10     adopted by vote of two-thirds of the members of the board
11     of directors or by a majority vote of the unit owners at a
12     meeting called for that purpose, unless the Act or the
13     declaration of the master association specifically
14     provides for greater percentages or different procedures.
15         (2) If, through a scrivener's error, a unit has not
16     been designated as owning an appropriate undivided share of
17     the common areas or does not bear an appropriate share of
18     the common expenses, or if all of the common expenses or
19     all of the common elements in the condominium have not been
20     distributed in the declaration, so that the sum total of
21     the shares of common areas which have been distributed or
22     the sum total of the shares of the common expenses fail to
23     equal 100%, or if it appears that more than 100% of the
24     common elements or common expenses have been distributed,
25     the error may be corrected by operation of law by filing an
26     amendment to the declaration, approved by vote of
27     two-thirds of the members of the board of directors or a
28     majority vote of the unit owners at a meeting called for
29     that purpose, which proportionately adjusts all percentage
30     interests so that the total is equal to 100%, unless the
31     declaration specifically provides for a different
32     procedure or different percentage vote by the owners of the
33     units and the owners of mortgages thereon affected by
34     modification being made in the undivided interest in the
35     common areas, the number of votes in the unit owners
36     association or the liability for common expenses

 

 

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1     appertaining to the unit.
2         (3) If an omission or error or a scrivener's error in
3     the declaration or other instrument is corrected by vote of
4     two-thirds of the members of the board of directors
5     pursuant to the authority established in subdivisions
6     (h)(1) or (h)(2) of this Section, the board, upon written
7     petition by unit owners with 20% of the votes of the
8     association or resolutions adopted by the board of managers
9     or board of directors of the condominium and common
10     interest community associations which select 20% of the
11     members of the board of directors of the master
12     association, whichever is applicable, received within 30
13     days of the board action, shall call a meeting of the unit
14     owners or the boards of the condominium and common interest
15     community associations which select members of the board of
16     directors of the master association within 30 days of the
17     filing of the petition or receipt of the condominium and
18     common interest community association resolution to
19     consider the board action. Unless a majority of the votes
20     of the unit owners of the association are cast at the
21     meeting to reject the action, or board of managers or board
22     of directors of condominium and common interest community
23     associations which select over 50% of the members of the
24     board of the master association adopt resolutions prior to
25     the meeting rejecting the action of the board of directors
26     of the master association, it is ratified whether or not a
27     quorum is present.
28         (4) The procedures for amendments set forth in this
29     subsection (h) cannot be used if such an amendment would
30     materially or adversely affect property rights of the unit
31     owners unless the affected unit owners consent in writing.
32     This Section does not restrict the powers of the
33     association to otherwise amend the declaration, bylaws, or
34     other condominium instruments, but authorizes a simple
35     process of amendment requiring a lesser vote for the
36     purpose of correcting defects, errors, or omissions when

 

 

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1     the property rights of the unit owners are not materially
2     or adversely affected.
3         (5) If there is an omission or error in the declaration
4     or other instruments that may not be corrected by an
5     amendment procedure set forth in subdivision (h)(1) or
6     (h)(2) of this Section, then the circuit court in the
7     county in which the master association is located shall
8     have jurisdiction to hear a petition of one or more of the
9     unit owners thereon or of the association, to correct the
10     error or omission, and the action may be a class action.
11     The court may require that one or more methods of
12     correcting the error or omission be submitted to the unit
13     owners to determine the most acceptable correction. All
14     unit owners in the association must be joined as parties to
15     the action. Service of process on owners may be by
16     publication, but the plaintiff shall furnish all unit
17     owners not personally served with process with copies of
18     the petition and final judgment of the court by certified
19     mail, return receipt requested, at their last known
20     address.
21         (6) Nothing contained in this Section shall be
22     construed to invalidate any provision of a declaration
23     authorizing the developer to amend an instrument prior to
24     the latest date on which the initial membership meeting of
25     the unit owners must be held, whether or not it has
26     actually been held, to bring the instrument into compliance
27     with the legal requirements of the Federal National
28     Mortgage Association, the Federal Home Loan Mortgage
29     Corporation, the Federal Housing Administration, the
30     United States Veterans Administration or their respective
31     successors and assigns.
32     (i) The provisions of subsections (c) through (h) are
33 applicable to all declarations, other condominium instruments,
34 and other duly recorded covenants establishing the powers and
35 duties of the master association recorded under this Act. Any
36 portion of a declaration, other condominium instrument, or

 

 

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1 other duly recorded covenant establishing the powers and duties
2 of a master association which contains provisions contrary to
3 the provisions of subsection (c) through (h) shall be void as
4 against public policy and ineffective. Any declaration, other
5 condominium instrument, or other duly recorded covenant
6 establishing the powers and duties of the master association
7 which fails to contain the provisions required by subsections
8 (c) through (h) shall be deemed to incorporate such provisions
9 by operation of law.
10     (j) The provisions of subsections (c) through (h) are
11 applicable to all common interest community associations and
12 their unit owners for common interest community associations
13 which are subject to the provisions of Section 9-102(a)(8) of
14 the Code of Civil Procedure. For purposes of this subsection,
15 the terms "common interest community" and "unit owners" shall
16 have the same meaning as set forth in Section 9-102(c) of the
17 Code of Civil Procedure.
18 (Source: P.A. 90-229, eff. 7-25-97; 91-616, eff. 8-19-99.)