96TH GENERAL ASSEMBLY
State of Illinois
2009 and 2010
SB0154

 

Introduced 1/30/2009, by Sen. Susan Garrett

 

SYNOPSIS AS INTRODUCED:
 
765 ILCS 605/18   from Ch. 30, par. 318

    Amends the Condominium Property Act. Provides that bylaws shall provide what percentage of unit owners, of other than 20%, shall constitute a quorum provided that for condominiums over 20 units the percentage of unit owners shall be 20% unless the unit owners with a majority percentage in the association provide for a higher percentage in voting on amendments to the bylaws, a unit owner in arrears on his or her regular and separate assessments for more than 60 days shall not be counted for purposes of determining if a quorum is present (instead of bylaws shall provide what percentage of unit owners, of other than 20%, shall constitute a quorum provided that for condominiums over 20 units the percentage of unit owners shall be 20% unless the unit owners with a majority percentage in the association provide for a higher percentage).


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A BILL FOR

 

SB0154 LRB096 03582 AJO 13608 b

1     AN ACT concerning civil law.
 
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 Section 18 as follows:
 
6     (765 ILCS 605/18)  (from Ch. 30, par. 318)
7     Sec. 18. Contents of bylaws. The bylaws shall provide for
8 at least the following:
9     (a) (1) The election from among the unit owners of a board
10     of managers, the number of persons constituting such board,
11     and that the terms of at least one-third of the members of
12     the board shall expire annually and that all members of the
13     board shall be elected at large. If there are multiple
14     owners of a single unit, only one of the multiple owners
15     shall be eligible to serve as a member of the board at any
16     one time.
17         (2) the powers and duties of the board;
18         (3) the compensation, if any, of the members of the
19     board;
20         (4) the method of removal from office of members of the
21     board;
22         (5) that the board may engage the services of a manager
23     or managing agent;

 

 

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1         (6) that each unit owner shall receive, at least 30
2     days prior to the adoption thereof by the board of
3     managers, a copy of the proposed annual budget together
4     with an indication of which portions are intended for
5     reserves, capital expenditures or repairs or payment of
6     real estate taxes;
7         (7) that the board of managers shall annually supply to
8     all unit owners an itemized accounting of the common
9     expenses for the preceding year actually incurred or paid,
10     together with an indication of which portions were for
11     reserves, capital expenditures or repairs or payment of
12     real estate taxes and with a tabulation of the amounts
13     collected pursuant to the budget or assessment, and showing
14     the net excess or deficit of income over expenditures plus
15     reserves;
16         (8) (i) that each unit owner shall receive notice, in
17     the same manner as is provided in this Act for membership
18     meetings, of any meeting of the board of managers
19     concerning the adoption of the proposed annual budget and
20     regular assessments pursuant thereto or to adopt a separate
21     (special) assessment, (ii) that except as provided in
22     subsection (iv) below, if an adopted budget or any separate
23     assessment adopted by the board would result in the sum of
24     all regular and separate assessments payable in the current
25     fiscal year exceeding 115% of the sum of all regular and
26     separate assessments payable during the preceding fiscal

 

 

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1     year, the board of managers, upon written petition by unit
2     owners with 20 percent of the votes of the association
3     delivered to the board within 14 days of the board action,
4     shall call a meeting of the unit owners within 30 days of
5     the date of delivery of the petition to consider the budget
6     or separate assessment; unless a majority of the total
7     votes of the unit owners are cast at the meeting to reject
8     the budget or separate assessment, it is ratified, (iii)
9     that any common expense not set forth in the budget or any
10     increase in assessments over the amount adopted in the
11     budget shall be separately assessed against all unit
12     owners, (iv) that separate assessments for expenditures
13     relating to emergencies or mandated by law may be adopted
14     by the board of managers without being subject to unit
15     owner approval or the provisions of item (ii) above or item
16     (v) below. As used herein, "emergency" means an immediate
17     danger to the structural integrity of the common elements
18     or to the life, health, safety or property of the unit
19     owners, (v) that assessments for additions and alterations
20     to the common elements or to association-owned property not
21     included in the adopted annual budget, shall be separately
22     assessed and are subject to approval of two-thirds of the
23     total votes of all unit owners, (vi) that the board of
24     managers may adopt separate assessments payable over more
25     than one fiscal year. With respect to multi-year
26     assessments not governed by items (iv) and (v), the entire

 

 

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1     amount of the multi-year assessment shall be deemed
2     considered and authorized in the first fiscal year in which
3     the assessment is approved;
4         (9) that meetings of the board of managers shall be
5     open to any unit owner, except for the portion of any
6     meeting held (i) to discuss litigation when an action
7     against or on behalf of the particular association has been
8     filed and is pending in a court or administrative tribunal,
9     or when the board of managers finds that such an action is
10     probable or imminent, (ii) to consider information
11     regarding appointment, employment or dismissal of an
12     employee, or (iii) to discuss violations of rules and
13     regulations of the association or a unit owner's unpaid
14     share of common expenses; that any vote on these matters
15     shall be taken at a meeting or portion thereof open to any
16     unit owner; that any unit owner may record the proceedings
17     at meetings or portions thereof required to be open by this
18     Act by tape, film or other means; that the board may
19     prescribe reasonable rules and regulations to govern the
20     right to make such recordings, that notice of such meetings
21     shall be mailed or delivered at least 48 hours prior
22     thereto, unless a written waiver of such notice is signed
23     by the person or persons entitled to such notice pursuant
24     to the declaration, bylaws, other condominium instrument,
25     or provision of law other than this subsection before the
26     meeting is convened, and that copies of notices of meetings

 

 

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1     of the board of managers shall be posted in entranceways,
2     elevators, or other conspicuous places in the condominium
3     at least 48 hours prior to the meeting of the board of
4     managers except where there is no common entranceway for 7
5     or more units, the board of managers may designate one or
6     more locations in the proximity of these units where the
7     notices of meetings shall be posted;
8         (10) that the board shall meet at least 4 times
9     annually;
10         (11) that no member of the board or officer shall be
11     elected for a term of more than 2 years, but that officers
12     and board members may succeed themselves;
13         (12) the designation of an officer to mail and receive
14     all notices and execute amendments to condominium
15     instruments as provided for in this Act and in the
16     condominium instruments;
17         (13) the method of filling vacancies on the board which
18     shall include authority for the remaining members of the
19     board to fill the vacancy by two-thirds vote until the next
20     annual meeting of unit owners or for a period terminating
21     no later than 30 days following the filing of a petition
22     signed by unit owners holding 20% of the votes of the
23     association requesting a meeting of the unit owners to fill
24     the vacancy for the balance of the term, and that a meeting
25     of the unit owners shall be called for purposes of filling
26     a vacancy on the board no later than 30 days following the

 

 

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1     filing of a petition signed by unit owners holding 20% of
2     the votes of the association requesting such a meeting, and
3     the method of filling vacancies among the officers that
4     shall include the authority for the members of the board to
5     fill the vacancy for the unexpired portion of the term;
6         (14) what percentage of the board of managers, if other
7     than a majority, shall constitute a quorum;
8         (15) provisions concerning notice of board meetings to
9     members of the board;
10         (16) the board of managers may not enter into a
11     contract with a current board member or with a corporation
12     or partnership in which a board member or a member of the
13     board member's immediate family has 25% or more interest,
14     unless notice of intent to enter the contract is given to
15     unit owners within 20 days after a decision is made to
16     enter into the contract and the unit owners are afforded an
17     opportunity by filing a petition, signed by 20% of the unit
18     owners, for an election to approve or disapprove the
19     contract; such petition shall be filed within 20 days after
20     such notice and such election shall be held within 30 days
21     after filing the petition; for purposes of this subsection,
22     a board member's immediate family means the board member's
23     spouse, parents, and children;
24         (17) that the board of managers may disseminate to unit
25     owners biographical and background information about
26     candidates for election to the board if (i) reasonable

 

 

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1     efforts to identify all candidates are made and all
2     candidates are given an opportunity to include
3     biographical and background information in the information
4     to be disseminated; and (ii) the board does not express a
5     preference in favor of any candidate;
6         (18) any proxy distributed for board elections by the
7     board of managers gives unit owners the opportunity to
8     designate any person as the proxy holder, and gives the
9     unit owner the opportunity to express a preference for any
10     of the known candidates for the board or to write in a
11     name;
12         (19) that special meetings of the board of managers can
13     be called by the president or 25% of the members of the
14     board; and
15         (20) that the board of managers may establish and
16     maintain a system of master metering of public utility
17     services and collect payments in connection therewith,
18     subject to the requirements of the Tenant Utility Payment
19     Disclosure Act.
20     (b) (1) What percentage of the unit owners, if other than
21     20%, shall constitute a quorum provided that, for
22     condominiums with 20 or more units, the percentage of unit
23     owners constituting a quorum shall be 20% unless the unit
24     owners holding a majority of the percentage interest in the
25     association provide for a higher percentage, provided that
26     in voting on amendments to the association's bylaws, a unit

 

 

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1     owner who is in arrears on the unit owner's regular and
2     separate assessments for 60 days or more, shall not be
3     counted for purposes of determining if a quorum is present;
4         (2) that the association shall have one class of
5     membership;
6         (3) that the members shall hold an annual meeting, one
7     of the purposes of which shall be to elect members of the
8     board of managers;
9         (4) the method of calling meetings of the unit owners;
10         (5) that special meetings of the members can be called
11     by the president, board of managers, or by 20% of unit
12     owners;
13         (6) that written notice of any membership meeting shall
14     be mailed or delivered giving members no less than 10 and
15     no more than 30 days notice of the time, place and purpose
16     of such meeting;
17         (7) that voting shall be on a percentage basis, and
18     that the percentage vote to which each unit is entitled is
19     the percentage interest of the undivided ownership of the
20     common elements appurtenant thereto, provided that the
21     bylaws may provide for approval by unit owners in
22     connection with matters where the requisite approval on a
23     percentage basis is not specified in this Act, on the basis
24     of one vote per unit;
25         (8) that, where there is more than one owner of a unit,
26     if only one of the multiple owners is present at a meeting

 

 

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1     of the association, he is entitled to cast all the votes
2     allocated to that unit, if more than one of the multiple
3     owners are present, the votes allocated to that unit may be
4     cast only in accordance with the agreement of a majority in
5     interest of the multiple owners, unless the declaration
6     expressly provides otherwise, that there is majority
7     agreement if any one of the multiple owners cast the votes
8     allocated to that unit without protest being made promptly
9     to the person presiding over the meeting by any of the
10     other owners of the unit;
11         (9)(A) that unless the Articles of Incorporation or the
12     bylaws otherwise provide, and except as provided in
13     subparagraph (B) of this paragraph (9) in connection with
14     board elections, a unit owner may vote by proxy executed in
15     writing by the unit owner or by his duly authorized
16     attorney in fact; that the proxy must bear the date of
17     execution and, unless the condominium instruments or the
18     written proxy itself provide otherwise, is invalid after 11
19     months from the date of its execution;
20         (B) that if a rule adopted at least 120 days before a
21     board election or the declaration or bylaws provide for
22     balloting as set forth in this subsection, unit owners may
23     not vote by proxy in board elections, but may vote only (i)
24     by submitting an association-issued ballot in person at the
25     election meeting or (ii) by submitting an
26     association-issued ballot to the association or its

 

 

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1     designated agent by mail or other means of delivery
2     specified in the declaration, bylaws, or rule; that the
3     ballots shall be mailed or otherwise distributed to unit
4     owners not less than 10 and not more than 30 days before
5     the election meeting, and the board shall give unit owners
6     not less than 21 days' prior written notice of the deadline
7     for inclusion of a candidate's name on the ballots; that
8     the deadline shall be no more than 7 days before the
9     ballots are mailed or otherwise distributed to unit owners;
10     that every such ballot must include the names of all
11     candidates who have given the board or its authorized agent
12     timely written notice of their candidacy and must give the
13     person casting the ballot the opportunity to cast votes for
14     candidates whose names do not appear on the ballot; that a
15     ballot received by the association or its designated agent
16     after the close of voting shall not be counted; that a unit
17     owner who submits a ballot by mail or other means of
18     delivery specified in the declaration, bylaws, or rule may
19     request and cast a ballot in person at the election
20     meeting, and thereby void any ballot previously submitted
21     by that unit owner;
22         (C) that if a written petition by unit owners with at
23     least 20% of the votes of the association is delivered to
24     the board within 14 days after the board's approval of a
25     rule adopted pursuant to subparagraph (B) of this paragraph
26     (9), the board shall call a meeting of the unit owners

 

 

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1     within 30 days after the date of delivery of the petition;
2     that unless a majority of the total votes of the unit
3     owners are cast at the meeting to reject the rule, the rule
4     is ratified;
5         (10) that the association may, upon adoption of the
6     appropriate rules by the board of managers, conduct
7     elections by secret ballot whereby the voting ballot is
8     marked only with the percentage interest for the unit and
9     the vote itself, provided that the board further adopt
10     rules to verify the status of the unit owner issuing a
11     proxy or casting a ballot; and further, that a candidate
12     for election to the board of managers or such candidate's
13     representative shall have the right to be present at the
14     counting of ballots at such election;
15         (11) that in the event of a resale of a condominium
16     unit the purchaser of a unit from a seller other than the
17     developer pursuant to an installment contract for purchase
18     shall during such times as he or she resides in the unit be
19     counted toward a quorum for purposes of election of members
20     of the board of managers at any meeting of the unit owners
21     called for purposes of electing members of the board, shall
22     have the right to vote for the election of members of the
23     board of managers and to be elected to and serve on the
24     board of managers unless the seller expressly retains in
25     writing any or all of such rights. In no event may the
26     seller and purchaser both be counted toward a quorum, be

 

 

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1     permitted to vote for a particular office or be elected and
2     serve on the board. Satisfactory evidence of the
3     installment contact shall be made available to the
4     association or its agents. For purposes of this subsection,
5     "installment contact" shall have the same meaning as set
6     forth in Section 1 (e) of "An Act relating to installment
7     contracts to sell dwelling structures", approved August
8     11, 1967, as amended;
9         (12) the method by which matters subject to the
10     approval of unit owners set forth in this Act, or in the
11     condominium instruments, will be submitted to the unit
12     owners at special membership meetings called for such
13     purposes; and
14         (13) that matters subject to the affirmative vote of
15     not less than 2/3 of the votes of unit owners at a meeting
16     duly called for that purpose, shall include, but not be
17     limited to:
18             (i) merger or consolidation of the association;
19             (ii) sale, lease, exchange, or other disposition
20         (excluding the mortgage or pledge) of all, or
21         substantially all of the property and assets of the
22         association; and
23             (iii) the purchase or sale of land or of units on
24         behalf of all unit owners.
25     (c) Election of a president from among the board of
26 managers, who shall preside over the meetings of the board of

 

 

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1 managers and of the unit owners.
2     (d) Election of a secretary from among the board of
3 managers, who shall keep the minutes of all meetings of the
4 board of managers and of the unit owners and who shall, in
5 general, perform all the duties incident to the office of
6 secretary.
7     (e) Election of a treasurer from among the board of
8 managers, who shall keep the financial records and books of
9 account.
10     (f) Maintenance, repair and replacement of the common
11 elements and payments therefor, including the method of
12 approving payment vouchers.
13     (g) An association with 30 or more units shall obtain and
14 maintain fidelity insurance covering persons who control or
15 disburse funds of the association for the maximum amount of
16 coverage available to protect funds in the custody or control
17 of the association plus the association reserve fund. All
18 management companies which are responsible for the funds held
19 or administered by the association shall maintain and furnish
20 to the association a fidelity bond for the maximum amount of
21 coverage available to protect funds in the custody of the
22 management company at any time. The association shall bear the
23 cost of the fidelity insurance and fidelity bond, unless
24 otherwise provided by contract between the association and a
25 management company. The association shall be the direct obligee
26 of any such fidelity bond. A management company holding reserve

 

 

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1 funds of an association shall at all times maintain a separate
2 account for each association, provided, however, that for
3 investment purposes, the Board of Managers of an association
4 may authorize a management company to maintain the
5 association's reserve funds in a single interest bearing
6 account with similar funds of other associations. The
7 management company shall at all times maintain records
8 identifying all moneys of each association in such investment
9 account. The management company may hold all operating funds of
10 associations which it manages in a single operating account but
11 shall at all times maintain records identifying all moneys of
12 each association in such operating account. Such operating and
13 reserve funds held by the management company for the
14 association shall not be subject to attachment by any creditor
15 of the management company.
16     For the purpose of this subsection a management company
17 shall be defined as a person, partnership, corporation, or
18 other legal entity entitled to transact business on behalf of
19 others, acting on behalf of or as an agent for a unit owner,
20 unit owners or association of unit owners for the purpose of
21 carrying out the duties, responsibilities, and other
22 obligations necessary for the day to day operation and
23 management of any property subject to this Act. For purposes of
24 this subsection, the term "fiduciary insurance coverage" shall
25 be defined as both a fidelity bond and directors and officers
26 liability coverage, the fidelity bond in the full amount of

 

 

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1 association funds and association reserves that will be in the
2 custody of the association, and the directors and officers
3 liability coverage at a level as shall be determined to be
4 reasonable by the board of managers, if not otherwise
5 established by the declaration or by laws.
6     Until one year after the effective date of this amendatory
7 Act of 1985, if a condominium association has reserves plus
8 assessments in excess of $250,000 and cannot reasonably obtain
9 100% fidelity bond coverage for such amount, then it must
10 obtain a fidelity bond coverage of $250,000.
11     (h) Method of estimating the amount of the annual budget,
12 and the manner of assessing and collecting from the unit owners
13 their respective shares of such estimated expenses, and of any
14 other expenses lawfully agreed upon.
15     (i) That upon 10 days notice to the manager or board of
16 managers and payment of a reasonable fee, any unit owner shall
17 be furnished a statement of his account setting forth the
18 amount of any unpaid assessments or other charges due and owing
19 from such owner.
20     (j) Designation and removal of personnel necessary for the
21 maintenance, repair and replacement of the common elements.
22     (k) Such restrictions on and requirements respecting the
23 use and maintenance of the units and the use of the common
24 elements, not set forth in the declaration, as are designed to
25 prevent unreasonable interference with the use of their
26 respective units and of the common elements by the several unit

 

 

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1 owners.
2     (l) Method of adopting and of amending administrative rules
3 and regulations governing the operation and use of the common
4 elements.
5     (m) The percentage of votes required to modify or amend the
6 bylaws, but each one of the particulars set forth in this
7 section shall always be embodied in the bylaws.
8     (n) (i) The provisions of this Act, the declaration,
9 bylaws, other condominium instruments, and rules and
10 regulations that relate to the use of the individual unit or
11 the common elements shall be applicable to any person leasing a
12 unit and shall be deemed to be incorporated in any lease
13 executed or renewed on or after the effective date of this
14 amendatory Act of 1984. (ii) With regard to any lease entered
15 into subsequent to the effective date of this amendatory Act of
16 1989, the unit owner leasing the unit shall deliver a copy of
17 the signed lease to the board or if the lease is oral, a
18 memorandum of the lease, not later than the date of occupancy
19 or 10 days after the lease is signed, whichever occurs first.
20 In addition to any other remedies, by filing an action jointly
21 against the tenant and the unit owner, an association may seek
22 to enjoin a tenant from occupying a unit or seek to evict a
23 tenant under the provisions of Article IX of the Code of Civil
24 Procedure for failure of the lessor-owner to comply with the
25 leasing requirements prescribed by this Section or by the
26 declaration, bylaws, and rules and regulations. The board of

 

 

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1 managers may proceed directly against a tenant, at law or in
2 equity, or under the provisions of Article IX of the Code of
3 Civil Procedure, for any other breach by tenant of any
4 covenants, rules, regulations or bylaws.
5     (o) The association shall have no authority to forbear the
6 payment of assessments by any unit owner.
7     (p) That when 30% or fewer of the units, by number, possess
8 over 50% in the aggregate of the votes in the association, any
9 percentage vote of members specified herein or in the
10 condominium instruments shall require the specified percentage
11 by number of units rather than by percentage of interest in the
12 common elements allocated to units that would otherwise be
13 applicable. For purposes of this subsection (p), when making a
14 determination of whether 30% or fewer of the units, by number,
15 possess over 50% in the aggregate of the votes in the
16 association, a unit shall not include a garage unit or a
17 storage unit.
18     (q) That a unit owner may not assign, delegate, transfer,
19 surrender, or avoid the duties, responsibilities, and
20 liabilities of a unit owner under this Act, the condominium
21 instruments, or the rules and regulations of the Association;
22 and that such an attempted assignment, delegation, transfer,
23 surrender, or avoidance shall be deemed void.
24     The provisions of this Section are applicable to all
25 condominium instruments recorded under this Act. Any portion of
26 a condominium instrument which contains provisions contrary to

 

 

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1 these provisions shall be void as against public policy and
2 ineffective. Any such instrument which fails to contain the
3 provisions required by this Section shall be deemed to
4 incorporate such provisions by operation of law.
5 (Source: P.A. 95-624, eff. 6-1-08.)