99TH GENERAL ASSEMBLY
State of Illinois
2015 and 2016
HB0486

 

Introduced , by Rep. Kelly M. Cassidy

 

SYNOPSIS AS INTRODUCED:
 
765 ILCS 605/2  from Ch. 30, par. 302
765 ILCS 605/9  from Ch. 30, par. 309
765 ILCS 605/22.1  from Ch. 30, par. 322.1

    Amends the Condominium Property Act. Defines "regular monthly assessments". Provides that following a foreclosure sale, consent foreclosure, common law strict foreclosure, or the delivery of a deed in lieu of foreclosure, the mortgagee shall have the duty to pay to the association all moneys due to satisfy the lien held by the association, except for the 9 months of unpaid regular monthly assessments and associated attorney's fees which may be collected from the purchaser. Provides that the amount due may include any attorney's fees and court costs, but may not exceed 9 months of regular assessments due over the same 9-month period. Deletes language providing that the purchaser shall have the duty to pay the proportionate share, if any, of the common expenses for the unit which would have become due in the absence of any assessment acceleration for the 6 months immediately preceding the institution of an action to enforce the collection of assessments, and which remain unpaid. Deletes language providing that if the outstanding assessments are paid at any time during an action to enforce the collection of assessments, the purchaser shall have no obligation to pay any assessments which accrued before he or she acquired title. Provides that the notice of a foreclosure sale of a condominium unit shall state that a purchaser, other than a mortgagee, shall pay to the association any unpaid monthly assessments for the 9-month period preceding the sale, including attorney's fees and court costs. Provides that each notice of a judicial sale a condominium unit and each disclosure statement issued to a prospective purchaser shall list the required fees. Provides that in certain situations, the Board of Managers (instead of the owner) of a condominium unit must make specified information available within 21 days of the request if the association is self-managed, and within 14 days if managed by a community association management firm or a community association manager as those terms are defined in the Community Association Manager Licensing and Disciplinary Act (instead of "upon demand") and may do so either electronically or in writing. Makes other changes. Effective immediately.


LRB099 06587 HEP 26660 b

 

 

A BILL FOR

 

HB0486LRB099 06587 HEP 26660 b

1    AN ACT concerning civil law.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Condominium Property Act is amended by
5changing Sections 2, 9 and 22.1 as follows:
 
6    (765 ILCS 605/2)  (from Ch. 30, par. 302)
7    Sec. 2. Definitions. As used in this Act, unless the
8context otherwise requires:
9    (a) "Declaration" means the instrument by which the
10property is submitted to the provisions of this Act, as
11hereinafter provided, and such declaration as from time to time
12amended.
13    (b) "Parcel" means the lot or lots, tract or tracts of
14land, described in the declaration, submitted to the provisions
15of this Act.
16    (c) "Property" means all the land, property and space
17comprising the parcel, all improvements and structures
18erected, constructed or contained therein or thereon,
19including the building and all easements, rights and
20appurtenances belonging thereto, and all fixtures and
21equipment intended for the mutual use, benefit or enjoyment of
22the unit owners, submitted to the provisions of this Act.
23    (d) "Unit" means a part of the property designed and

 

 

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1intended for any type of independent use.
2    (e) "Common Elements" means all portions of the property
3except the units, including limited common elements unless
4otherwise specified.
5    (f) "Person" means a natural individual, corporation,
6partnership, trustee or other legal entity capable of holding
7title to real property.
8    (g) "Unit Owner" means the person or persons whose estates
9or interests, individually or collectively, aggregate fee
10simple absolute ownership of a unit, or, in the case of a
11leasehold condominium, the lessee or lessees of a unit whose
12leasehold ownership of the unit expires simultaneously with the
13lease described in item (x) of this Section.
14    (h) "Majority" or "majority of the unit owners" means the
15owners of more than 50% in the aggregate in interest of the
16undivided ownership of the common elements. Any specified
17percentage of the unit owners means such percentage in the
18aggregate in interest of such undivided ownership. "Majority"
19or "majority of the members of the board of managers" means
20more than 50% of the total number of persons constituting such
21board pursuant to the bylaws. Any specified percentage of the
22members of the board of managers means that percentage of the
23total number of persons constituting such board pursuant to the
24bylaws.
25    (i) "Plat" means a plat or plats of survey of the parcel
26and of all units in the property submitted to the provisions of

 

 

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1this Act, which may consist of a three-dimensional horizontal
2and vertical delineation of all such units.
3    (j) "Record" means to record in the office of the recorder
4or, whenever required, to file in the office of the Registrar
5of Titles of the county wherein the property is located.
6    (k) "Conversion Condominium" means a property which
7contains structures, excepting those newly constructed and
8intended for condominium ownership, which are, or have
9previously been, wholly or partially occupied before recording
10of condominium instruments by persons other than those who have
11contracted for the purchase of condominiums.
12    (l) "Condominium Instruments" means all documents and
13authorized amendments thereto recorded pursuant to the
14provisions of the Act, including the declaration, bylaws and
15plat.
16    (m) "Common Expenses" means the proposed or actual expenses
17affecting the property, including reserves, if any, lawfully
18assessed by the Board of Managers of the Unit Owner's
19Association.
20    (n) "Reserves" means those sums paid by unit owners which
21are separately maintained by the board of managers for purposes
22specified by the board of managers or the condominium
23instruments.
24    (o) "Unit Owners' Association" or "Association" means the
25association of all the unit owners, acting pursuant to bylaws
26through its duly elected board of managers.

 

 

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1    (p) "Purchaser" means any person or persons other than the
2Developer who purchase a unit in a bona fide transaction for
3value.
4    (q) "Developer" means any person who submits property
5legally or equitably owned in fee simple by the developer, or
6leased to the developer under a lease described in item (x) of
7this Section, to the provisions of this Act, or any person who
8offers units legally or equitably owned in fee simple by the
9developer, or leased to the developer under a lease described
10in item (x) of this Section, for sale in the ordinary course of
11such person's business, including any successor or successors
12to such developers' entire interest in the property other than
13the purchaser of an individual unit.
14    (r) "Add-on Condominium" means a property to which
15additional property may be added in accordance with condominium
16instruments and this Act.
17    (s) "Limited Common Elements" means a portion of the common
18elements so designated in the declaration as being reserved for
19the use of a certain unit or units to the exclusion of other
20units, including but not limited to balconies, terraces, patios
21and parking spaces or facilities.
22    (t) "Building" means all structures, attached or
23unattached, containing one or more units.
24    (u) "Master Association" means an organization described
25in Section 18.5 whether or not it is also an association
26described in Section 18.3.

 

 

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1    (v) "Developer Control" means such control at a time prior
2to the election of the Board of Managers provided for in
3Section 18.2(b) of this Act.
4    (w) "Meeting of Board of Managers or Board of Master
5Association" means any gathering of a quorum of the members of
6the Board of Managers or Board of the Master Association held
7for the purpose of conducting board business.
8    (x) "Leasehold Condominium" means a property submitted to
9the provisions of this Act which is subject to a lease, the
10expiration or termination of which would terminate the
11condominium and the lessor of which is (i) exempt from taxation
12under Section 501(c)(3) of the Internal Revenue Code of 1986,
13as amended, (ii) a limited liability company whose sole member
14is exempt from taxation under Section 501 (c)(3) of the
15Internal Revenue Code of 1986, as amended, or (iii) a Public
16Housing Authority created pursuant to the Housing Authorities
17Act that is located in a municipality having a population in
18excess of 1,000,000 inhabitants.
19    (y) "Electronic transmission" means any form of
20communication, not directly involving the physical
21transmission of paper, that creates a record that may be
22retained, retrieved, and reviewed by a recipient and that may
23be directly reproduced in paper form by the recipient through
24an automated process.
25    (z) "Acceptable technological means" includes, without
26limitation, electronic transmission over the Internet or other

 

 

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1network, whether by direct connection, intranet, telecopier,
2or electronic mail.
3    (aa) "Regular Monthly Assessments" means the amount
4charged by the association as provided for in the current
5annual budget adopted under subsection (c) of Section 9 of this
6Act.
7(Source: P.A. 98-1042, eff. 1-1-15.)
 
8    (765 ILCS 605/9)  (from Ch. 30, par. 309)
9    Sec. 9. Sharing of expenses - Lien for nonpayment.
10    (a) All common expenses incurred or accrued prior to the
11first conveyance of a unit shall be paid by the developer, and
12during this period no common expense assessment shall be
13payable to the association. It shall be the duty of each unit
14owner including the developer to pay his proportionate share of
15the common expenses commencing with the first conveyance. The
16proportionate share shall be in the same ratio as his
17percentage of ownership in the common elements set forth in the
18declaration.
19    (b) The condominium instruments may provide that common
20expenses for insurance premiums be assessed on a basis
21reflecting increased charges for coverage on certain units.
22    (c) Budget and reserves.
23        (1) The board of managers shall prepare and distribute
24    to all unit owners a detailed proposed annual budget,
25    setting forth with particularity all anticipated common

 

 

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1    expenses by category as well as all anticipated assessments
2    and other income. The initial budget and common expense
3    assessment based thereon shall be adopted prior to the
4    conveyance of any unit. The budget shall also set forth
5    each unit owner's proposed common expense assessment.
6        (2) All budgets adopted by a board of managers on or
7    after July 1, 1990 shall provide for reasonable reserves
8    for capital expenditures and deferred maintenance for
9    repair or replacement of the common elements. To determine
10    the amount of reserves appropriate for an association, the
11    board of managers shall take into consideration the
12    following: (i) the repair and replacement cost, and the
13    estimated useful life, of the property which the
14    association is obligated to maintain, including but not
15    limited to structural and mechanical components, surfaces
16    of the buildings and common elements, and energy systems
17    and equipment; (ii) the current and anticipated return on
18    investment of association funds; (iii) any independent
19    professional reserve study which the association may
20    obtain; (iv) the financial impact on unit owners, and the
21    market value of the condominium units, of any assessment
22    increase needed to fund reserves; and (v) the ability of
23    the association to obtain financing or refinancing.
24        (3) Notwithstanding the provisions of this subsection
25    (c), an association without a reserve requirement in its
26    condominium instruments may elect to waive in whole or in

 

 

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1    part the reserve requirements of this Section by a vote of
2    2/3 of the total votes of the association. Any association
3    having elected under this paragraph (3) to waive the
4    provisions of subsection (c) may by a vote of 2/3 of the
5    total votes of the association elect to again be governed
6    by the requirements of subsection (c).
7        (4) In the event that an association elects to waive
8    all or part of the reserve requirements of this Section,
9    that fact must be disclosed after the meeting at which the
10    waiver occurs by the association in the financial
11    statements of the association and, highlighted in bold
12    print, in the response to any request of a prospective
13    purchaser for the information prescribed under Section
14    22.1; and no member of the board of managers or the
15    managing agent of the association shall be liable, and no
16    cause of action may be brought for damages against these
17    parties, for the lack or inadequacy of reserve funds in the
18    association budget.
19    (d) (Blank).
20    (e) The condominium instruments may provide for the
21assessment, in connection with expenditures for the limited
22common elements, of only those units to which the limited
23common elements are assigned.
24    (f) Payment of any assessment shall be in amounts and at
25times determined by the board of managers.
26    (g) Lien.

 

 

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1        (1) If any unit owner shall fail or refuse to make any
2    payment of the common expenses or the amount of any unpaid
3    fine when due, the amount thereof together with any
4    interest, late charges, reasonable attorney fees incurred
5    enforcing the covenants of the condominium instruments,
6    rules and regulations of the board of managers, or any
7    applicable statute or ordinance, and costs of collections
8    shall constitute a lien on the interest of the unit owner
9    in the property prior to all other liens and encumbrances,
10    recorded or unrecorded, except only (a) taxes, special
11    assessments and special taxes theretofore or thereafter
12    levied by any political subdivision or municipal
13    corporation of this State and other State or federal taxes
14    which by law are a lien on the interest of the unit owner
15    prior to preexisting recorded encumbrances thereon and (b)
16    encumbrances on the interest of the unit owner recorded
17    prior to the date of such failure or refusal which by law
18    would be a lien thereon prior to subsequently recorded
19    encumbrances. Any action brought to extinguish the lien of
20    the association shall include the association as a party.
21        (2) With respect to encumbrances executed prior to
22    August 30, 1984 or encumbrances executed subsequent to
23    August 30, 1984 which are neither bonafide first mortgages
24    nor trust deeds and which encumbrances contain a statement
25    of a mailing address in the State of Illinois where notice
26    may be mailed to the encumbrancer thereunder, if and

 

 

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1    whenever and as often as the manager or board of managers
2    shall send, by United States certified or registered mail,
3    return receipt requested, to any such encumbrancer at the
4    mailing address set forth in the recorded encumbrance a
5    statement of the amounts and due dates of the unpaid common
6    expenses with respect to the encumbered unit, then, unless
7    otherwise provided in the declaration or bylaws, the prior
8    recorded encumbrance shall be subject to the lien of all
9    unpaid common expenses with respect to the unit which
10    become due and payable within a period of 90 days after the
11    date of mailing of each such notice.
12        (3) The purchaser of a condominium unit at a judicial
13    foreclosure sale, or a mortgagee who receives title to a
14    unit by deed in lieu of foreclosure or judgment by common
15    law strict foreclosure or otherwise takes possession
16    pursuant to court order under the Illinois Mortgage
17    Foreclosure Law, shall have the duty to pay the unit's
18    proportionate share of the common expenses for the unit
19    assessed from and after the first day of the month after
20    the date of the judicial foreclosure sale, delivery of the
21    deed in lieu of foreclosure, entry of a judgment in common
22    law strict foreclosure, or taking of possession pursuant to
23    such court order. Such payment confirms the extinguishment
24    of any lien created pursuant to paragraph (1) or (2) of
25    this subsection (g) by virtue of the failure or refusal of
26    a prior unit owner to make payment of common expenses,

 

 

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1    where the judicial foreclosure sale has been confirmed by
2    order of the court, a deed in lieu thereof has been
3    accepted by the lender, or a consent judgment has been
4    entered by the court.
5        (4) Following a foreclosure sale, consent foreclosure,
6    common law strict foreclosure, or the delivery of a deed in
7    lieu of foreclosure, the mortgagee shall have the duty to
8    pay to the association those amounts required by
9    subdivision (g)(1) of Section 9 of this Act, except that
10    the The purchaser of a condominium unit at a judicial
11    foreclosure sale, other than a mortgagee, or a purchaser of
12    a condominium unit from a mortgagee who acquired title
13    through a judicial foreclosure, a consent foreclosure, a
14    common law strict foreclosure, or the delivery of a deed in
15    lieu of foreclosure who takes possession of a condominium
16    unit pursuant to a court order or a purchaser who acquires
17    title from a mortgagee shall have the duty to pay to the
18    association an amount not to exceed the total of the unpaid
19    regular monthly assessments for the condominium unit for
20    the 9-month period immediately preceding the date of the
21    judicial foreclosure sale, delivery of the deed in lieu of
22    foreclosure, entry of a judgment in a common law strict
23    foreclosure, or the taking of possession pursuant to a
24    court order under the Illinois Mortgage Foreclosure Law.
25    The amount due may include any attorney's fees incurred by
26    the association due to the non-payment of the assessments

 

 

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1    during the same 9-month period, and in no event shall the
2    total amount due exceed the sum of 9 months of regular
3    monthly assessments the proportionate share, if any, of the
4    common expenses for the unit which would have become due in
5    the absence of any assessment acceleration during the 6
6    months immediately preceding institution of an action to
7    enforce the collection of assessments, and which remain
8    unpaid by the owner during whose possession the assessments
9    accrued. If the outstanding assessments are paid at any
10    time during any action to enforce the collection of
11    assessments, the purchaser shall have no obligation to pay
12    any assessments which accrued before he or she acquired
13    title.
14        (5) The notice of sale of a condominium unit under
15    subsection (c) of Section 15-1507 of the Code of Civil
16    Procedure shall state that the purchaser of the unit other
17    than a mortgagee shall pay to the association amounts the
18    assessments and the legal fees required by subdivision
19    subdivisions (g)(1) and (g)(4) of Section 9 of this Act.
20    The statement of assessment account issued by the
21    association to a unit owner under subsection (i) of Section
22    18 of this Act, and the disclosure statement issued to a
23    prospective purchaser under Section 22.1 of this Act, shall
24    state the amount of the assessments and the legal fees, if
25    any, required by subdivisions (g)(1) and (g)(4) of Section
26    9 of this Act.

 

 

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1    (h) A lien for common expenses shall be in favor of the
2members of the board of managers and their successors in office
3and shall be for the benefit of all other unit owners. Notice
4of the lien may be recorded by the board of managers, or if the
5developer is the manager or has a majority of seats on the
6board of managers and the manager or board of managers fails to
7do so, any unit owner may record notice of the lien. Upon the
8recording of such notice the lien may be foreclosed by an
9action brought in the name of the board of managers in the same
10manner as a mortgage of real property.
11    (i) Unless otherwise provided in the declaration, the
12members of the board of managers and their successors in
13office, acting on behalf of the other unit owners, shall have
14the power to bid on the interest so foreclosed at the
15foreclosure sale, and to acquire and hold, lease, mortgage and
16convey it.
17    (j) Any encumbrancer may from time to time request in
18writing a written statement from the manager or board of
19managers setting forth the unpaid common expenses with respect
20to the unit covered by his encumbrance. Unless the request is
21complied with within 20 days, all unpaid common expenses which
22become due prior to the date of the making of such request
23shall be subordinate to the lien of the encumbrance. Any
24encumbrancer holding a lien on a unit may pay any unpaid common
25expenses payable with respect to the unit, and upon payment the
26encumbrancer shall have a lien on the unit for the amounts paid

 

 

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1at the same rank as the lien of his encumbrance.
2    (k) Nothing in Public Act 83-1271 is intended to change the
3lien priorities of any encumbrance created prior to August 30,
41984.
5(Source: P.A. 94-1049, eff. 1-1-07.)
 
6    (765 ILCS 605/22.1)  (from Ch. 30, par. 322.1)
7    Sec. 22.1. (a) In the event of any resale of a condominium
8unit by a unit owner other than the developer, the Board of
9Managers shall produce for the seller and the prospective
10purchaser, either electronically or in writing, within 14 days
11of a request from the owner or the owner's agent if the
12association is managed by a community association management
13firm or a community association manager, as those terms are
14defined in Section 10 of the Community Association Manager
15Licensing and Disciplinary Act, and within 21 days if the
16association is self-managed: such owner shall obtain from the
17Board of Managers and shall make available for inspection to
18the prospective purchaser, upon demand, the following:
19        (1) A copy of the Declaration, by-laws, other
20    condominium instruments and any rules and regulations.
21        (2) A statement of any liens, including a statement of
22    the account of the unit setting forth the amounts of unpaid
23    assessments and other charges due and owing as authorized
24    and limited by the provisions of Section 9 of this Act or
25    the condominium instruments.

 

 

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1        (3) A statement of any capital expenditures
2    anticipated by the unit owner's association within the
3    current or succeeding two fiscal years.
4        (4) A statement of the status and amount of any reserve
5    for replacement fund and any portion of such fund earmarked
6    for any specified project by the Board of Managers.
7        (5) A copy of the statement of financial condition of
8    the unit owner's association for the last fiscal year for
9    which such statement is available.
10        (6) A statement of the status of any pending suits or
11    judgments in which the unit owner's association is a party.
12        (7) A statement setting forth what insurance coverage
13    is provided for all unit owners by the unit owner's
14    association.
15        (8) A statement that any improvements or alterations
16    made to the unit, or the limited common elements assigned
17    thereto, by the prior unit owner are in good faith believed
18    to be in compliance with the condominium instruments.
19        (9) The identity and mailing address of the principal
20    officer of the unit owner's association or of the other
21    officer or agent as is specifically designated to receive
22    notices.
23        (10) If ownership of the condominium unit was
24    transferred by either a judicial foreclosure sale, a
25    consent foreclosure, a common law strict foreclosure, or a
26    deed in lieu of foreclosure, a statement setting forth the

 

 

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1    total due and owing under subsection (g) of Section 9 of
2    this Act.
3    (b) The principal officer of the unit owner's association
4or such other officer as is specifically designated shall
5furnish the above information when requested to do so either
6electronically or in writing and within 14 30 days of the
7request.
8    (c) Within 15 days of the recording of a mortgage or trust
9deed against a unit ownership given by the owner of that unit
10to secure a debt, the owner shall inform the Board of Managers
11of the unit owner's association of the identity of the lender
12together with a mailing address at which the lender can receive
13notices from the association. If a unit owner fails or refuses
14to inform the Board as required under subsection (c) then that
15unit owner shall be liable to the association for all costs,
16expenses and reasonable attorneys fees and such other damages,
17if any, incurred by the association as a result of such failure
18or refusal.
19    A reasonable fee covering the direct out-of-pocket cost of
20providing such information and copying may be charged by the
21association or its Board of Managers to the unit seller for
22providing such information.
23(Source: P.A. 87-692.)
 
24    Section 99. Effective date. This Act takes effect upon
25becoming law.