Public Act 90-0229 of the 90th General Assembly
Public Act 90-0229
SB844 Enrolled LRB9003444NTsb
AN ACT to amend the Condominium Property Act by changing
Section 18.5.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Condominium Property Act is amended by
changing Section 18.5 as follows:
(765 ILCS 605/18.5) (from Ch. 30, par. 318.5)
Sec. 18.5. Master Associations.
(a) If the declaration, other condominium instrument, or
other duly recorded covenants provide that any of the powers
of the unit owners associations are to be exercised by or may
be delegated to a nonprofit corporation or unincorporated
association that exercises those or other powers on behalf of
one or more condominiums, or for the benefit of the unit
owners of one or more condominiums, such corporation or
association shall be a master association.
(b) There shall be included in the declaration, other
condominium instruments, or other duly recorded covenants
establishing the powers and duties of the master association
the provisions set forth in subsections (c) through (h).
In interpreting subsections (c) through (h), the courts
should interpret these provisions so that they are
interpreted consistently with the similar parallel provisions
found in other parts of this Act.
(c) Meetings and finances.
(1) Each unit owner of a condominium subject to the
authority of the board of the master association shall
receive, at least 30 days prior to the adoption thereof
by the board of the master association, a copy of the
proposed annual budget.
(2) The board of the master association shall
annually supply to all unit owners of condominiums
subject to the authority of the board of the master
association an itemized accounting of the common expenses
for the preceding year actually incurred or paid,
together with a tabulation of the amounts collected
pursuant to the budget or assessment, and showing the net
excess or deficit of income over expenditures plus
reserves.
(3) Each unit owner of a condominium subject to the
authority of the board of the master association shall
receive written notice mailed or delivered no less than
10 and no more than 30 days prior to any meeting of the
board of the master association concerning the adoption
of the proposed annual budget or any increase in the
budget, or establishment of an assessment.
(4) Meetings of the board of the master association
shall be open to any unit owner in a condominium subject
to the authority of the board of the master association,
except for the portion of any meeting held:
(A) to discuss litigation when an action
against or on behalf of the particular master
association has been filed and is pending in a court
or administrative tribunal, or when the board of the
master association finds that such an action is
probable or imminent,
(B) to consider information regarding
appointment, employment or dismissal of an employee,
or
(C) to discuss violations of rules and
regulations of the master association or unpaid
common expenses owed to the master association.
Any vote on these matters shall be taken at a meeting or
portion thereof open to any unit owner of a condominium
subject to the authority of the master association.
Any unit owner may record the proceedings at
meetings required to be open by this Act by tape, film or
other means; the board may prescribe reasonable rules and
regulations to govern the right to make such recordings.
Notice of meetings shall be mailed or delivered at least
48 hours prior thereto, unless a written waiver of such
notice is signed by the persons entitled to notice before
the meeting is convened. Copies of notices of meetings
of the board of the master association shall be posted in
entranceways, elevators, or other conspicuous places in
the condominium at least 48 hours prior to the meeting of
the board of the master association. Where there is no
common entranceway for 7 or more units, the board of the
master association may designate one or more locations in
the proximity of these units where the notices of
meetings shall be posted.
(5) If the declaration provides for election by
unit owners of members of the board of directors in the
event of a resale of a unit in the master association,
the purchaser of a unit from a seller other than the
developer pursuant to an installment contract for
purchase shall, during such times as he or she resides in
the unit, be counted toward a quorum for purposes of
election of members of the board of directors at any
meeting of the unit owners called for purposes of
electing members of the board, and shall have the right
to vote for the election of members of the board of
directors and to be elected to and serve on the board of
directors unless the seller expressly retains in writing
any or all of those rights. In no event may the seller
and purchaser both be counted toward a quorum, be
permitted to vote for a particular office, or be elected
and serve on the board. Satisfactory evidence of the
installment contract shall be made available to the
association or its agents. For purposes of this
subsection, "installment contract" shall have the same
meaning as set forth in subsection (e) of Section 1 of
the Dwelling Unit Installment Contract Act.
(6) The board of the master association shall have
the authority to establish and maintain a system of
master metering of public utility services and to collect
payments in connection therewith, subject to the
requirements of the Tenant Utility Payment Disclosure
Act.
(7) The board of the master association or a common
interest community association shall have the power,
after notice and an opportunity to be heard, to levy and
collect reasonable fines from members for violations of
the declaration, bylaws, and rules and regulations of the
master association or the common interest community
association. Nothing contained in this subdivision (7)
shall give rise to a statutory lien for unpaid fines.
(d) Records.
(1) The board of the master association shall
maintain the following records of the association and
make them available for examination and copying at
convenient hours of weekdays by any unit owners in a
condominium subject to the authority of the board or
their mortgagees and their duly authorized agents or
attorneys:
(i) Copies of the recorded declaration, other
condominium instruments, other duly recorded
covenants and bylaws and any amendments, articles of
incorporation of the master association, annual
reports and any rules and regulations adopted by the
master association or its board shall be available.
Prior to the organization of the master association,
the developer shall maintain and make available the
records set forth in this subdivision (d)(1) for
examination and copying.
(ii) Detailed and accurate records in
chronological order of the receipts and expenditures
affecting the common areas, specifying and itemizing
the maintenance and repair expenses of the common
areas and any other expenses incurred, and copies of
all contracts, leases, or other agreements entered
into by the master association, shall be maintained.
(iii) The minutes of all meetings of the
master association and the board of the master
association shall be maintained for not less than 7
years.
(iv) Ballots and proxies related thereto, if
any, for any election held for the board of the
master association and for any other matters voted
on by the unit owners shall be maintained for not
less than one year.
(v) Such other records of the master
association as are available for inspection by
members of a not-for-profit corporation pursuant to
Section 107.75 of the General Not For Profit
Corporation Act of 1986 shall be maintained.
(vi) With respect to units owned by a land
trust, if a trustee designates in writing a person
to cast votes on behalf of the unit owner, the
designation shall remain in effect until a
subsequent document is filed with the association.
(2) Where a request for records under this
subsection is made in writing to the board of managers or
its agent, failure to provide the requested record or to
respond within 30 days shall be deemed a denial by the
board of directors.
(3) A reasonable fee may be charged by the master
association or its board for the cost of copying.
(4) If the board of directors fails to provide
records properly requested under subdivision (d)(1)
within the time period provided in subdivision (d)(2),
the unit owner may seek appropriate relief, including an
award of attorney's fees and costs.
(e) The board of directors shall have standing and
capacity to act in a representative capacity in relation to
matters involving the common areas of the master association
or more than one unit, on behalf of the unit owners as their
interests may appear.
(f) Administration of property prior to election of the
initial board of directors.
(1) Until the election, by the unit owners or the
boards of managers of the underlying condominium
associations, of the initial board of directors of a
master association whose declaration is recorded on or
after August 10, 1990, the same rights, titles, powers,
privileges, trusts, duties and obligations that are
vested in or imposed upon the board of directors by this
Act or in the declaration or other duly recorded covenant
shall be held and performed by the developer.
(2) The election of the initial board of directors
of a master association whose declaration is recorded on
or after August 10, 1990, by the unit owners or the
boards of managers of the underlying condominium
associations, shall be held not later than 60 days after
the conveyance by the developer of 75% of the units, or 3
years after the recording of the declaration, whichever
is earlier. The developer shall give at least 21 days
notice of the meeting to elect the initial board of
directors and shall upon request provide to any unit
owner, within 3 working days of the request, the names,
addresses, and weighted vote of each unit owner entitled
to vote at the meeting. Any unit owner shall upon
receipt of the request be provided with the same
information, within 10 days of the request, with respect
to each subsequent meeting to elect members of the board
of directors.
(3) If the initial board of directors of a master
association whose declaration is recorded on or after
August 10, 1990 is not elected by the unit owners or the
members of the underlying condominium association board
of managers at the time established in subdivision
(f)(2), the developer shall continue in office for a
period of 30 days, whereupon written notice of his
resignation shall be sent to all of the unit owners or
members of the underlying condominium board of managers
entitled to vote at an election for members of the board
of directors.
(4) Within 60 days following the election of a
majority of the board of directors, other than the
developer, by unit owners, the developer shall deliver to
the board of directors:
(i) All original documents as recorded or
filed pertaining to the property, its
administration, and the association, such as the
declaration, articles of incorporation, other
instruments, annual reports, minutes, rules and
regulations, and contracts, leases, or other
agreements entered into by the association. If any
original documents are unavailable, a copy may be
provided if certified by affidavit of the developer,
or an officer or agent of the developer, as being a
complete copy of the actual document recorded or
filed.
(ii) A detailed accounting by the developer,
setting forth the source and nature of receipts and
expenditures in connection with the management,
maintenance and operation of the property, copies of
all insurance policies, and a list of any loans or
advances to the association which are outstanding.
(iii) Association funds, which shall have been
at all times segregated from any other moneys of the
developer.
(iv) A schedule of all real or personal
property, equipment and fixtures belonging to the
association, including documents transferring the
property, warranties, if any, for all real and
personal property and equipment, deeds, title
insurance policies, and all tax bills.
(v) A list of all litigation, administrative
action and arbitrations involving the association,
any notices of governmental bodies involving actions
taken or which may be taken concerning the
association, engineering and architectural drawings
and specifications as approved by any governmental
authority, all other documents filed with any other
governmental authority, all governmental
certificates, correspondence involving enforcement
of any association requirements, copies of any
documents relating to disputes involving unit
owners, and originals of all documents relating to
everything listed in this subparagraph.
(5) With respect to any master association whose
declaration is recorded on or after August 10, 1990, any
contract, lease, or other agreement made prior to the
election of a majority of the board of directors other
than the developer by or on behalf of unit owners or
underlying condominium associations, the association or
the board of directors, which extends for a period of
more than 2 years from the recording of the declaration,
shall be subject to cancellation by more than 1/2 of the
votes of the unit owners, other than the developer, cast
at a special meeting of members called for that purpose
during a period of 90 days prior to the expiration of the
2 year period if the board of managers is elected by the
unit owners, otherwise by more than 1/2 of the underlying
condominium board of managers. At least 60 days prior to
the expiration of the 2 year period, the board of
directors, or, if the board is still under developer
control, then the board of managers or the developer
shall send notice to every unit owner or underlying
condominium board of managers, notifying them of this
provision, of what contracts, leases and other agreements
are affected, and of the procedure for calling a meeting
of the unit owners or for action by the underlying
condominium board of managers for the purpose of acting
to terminate such contracts, leases or other agreements.
During the 90 day period the other party to the contract,
lease, or other agreement shall also have the right of
cancellation.
(6) The statute of limitations for any actions in
law or equity which the master association may bring
shall not begin to run until the unit owners or
underlying condominium board of managers have elected a
majority of the members of the board of directors.
(g) In the event of any resale of a unit in a master
association by a unit owner other than the developer, the
owner shall obtain from the board of directors and shall make
available for inspection to the prospective purchaser, upon
demand, the following:
(1) A copy of the declaration, other instruments
and any rules and regulations.
(2) A statement of any liens, including a statement
of the account of the unit setting forth the amounts of
unpaid assessments and other charges due and owing.
(3) A statement of any capital expenditures
anticipated by the association within the current or
succeeding 2 fiscal years.
(4) A statement of the status and amount of any
reserve for replacement fund and any portion of such fund
earmarked for any specified project by the board of
directors.
(5) A copy of the statement of financial condition
of the association for the last fiscal year for which
such a statement is available.
(6) A statement of the status of any pending suits
or judgments in which the association is a party.
(7) A statement setting forth what insurance
coverage is provided for all unit owners by the
association.
(8) A statement that any improvements or
alterations made to the unit, or any part of the common
areas assigned thereto, by the prior unit owner are in
good faith believed to be in compliance with the
declaration of the master association.
The principal officer of the unit owner's association or
such other officer as is specifically designated shall
furnish the above information when requested to do so in
writing, within 30 days of receiving the request.
A reasonable fee covering the direct out-of-pocket cost
of copying and providing such information may be charged by
the association or its board of directors to the unit seller
for providing the information.
(h) Errors and omissions.
(1) If there is an omission or error in the
declaration or other instrument of the master
association, the master association may correct the error
or omission by an amendment to the declaration or other
instrument, as may be required to conform it to this Act,
to any other applicable statute, or to the declaration.
The amendment shall be adopted by vote of two-thirds of
the members of the board of directors or by a majority
vote of the unit owners at a meeting called for that
purpose, unless the Act or the declaration of the master
association specifically provides for greater percentages
or different procedures.
(2) If, through a scrivener's error, a unit has not
been designated as owning an appropriate undivided share
of the common areas or does not bear an appropriate share
of the common expenses, or if all of the common expenses
or all of the common elements in the condominium have not
been distributed in the declaration, so that the sum
total of the shares of common areas which have been
distributed or the sum total of the shares of the common
expenses fail to equal 100%, or if it appears that more
than 100% of the common elements or common expenses have
been distributed, the error may be corrected by operation
of law by filing an amendment to the declaration,
approved by vote of two-thirds of the members of the
board of directors or a majority vote of the unit owners
at a meeting called for that purpose, which
proportionately adjusts all percentage interests so that
the total is equal to 100%, unless the declaration
specifically provides for a different procedure or
different percentage vote by the owners of the units and
the owners of mortgages thereon affected by modification
being made in the undivided interest in the common areas,
the number of votes in the unit owners association or the
liability for common expenses appertaining to the unit.
(3) If an omission or error or a scrivener's error
in the declaration or other instrument is corrected by
vote of two-thirds of the members of the board of
directors pursuant to the authority established in
subdivisions (h)(1) or (h)(2) of this Section, the board,
upon written petition by unit owners with 20% of the
votes of the association or resolutions adopted by the
board of managers or board of directors of the
condominium and common interest community associations
which select 20% of the members of the board of directors
of the master association, whichever is applicable,
received within 30 days of the board action, shall call a
meeting of the unit owners or the boards of the
condominium and common interest community associations
which select members of the board of directors of the
master association within 30 days of the filing of the
petition or receipt of the condominium and common
interest community association resolution to consider the
board action. Unless a majority of the votes of the unit
owners of the association are cast at the meeting to
reject the action, or board of managers or board of
directors of condominium and common interest community
associations which select over 50% of the members of the
board of the master association adopt resolutions prior
to the meeting rejecting the action of the board of
directors of the master association, it is ratified
whether or not a quorum is present.
(4) The procedures for amendments set forth in this
subsection (h) cannot be used if such an amendment would
materially or adversely affect property rights of the
unit owners unless the affected unit owners consent in
writing. This Section does not restrict the powers of
the association to otherwise amend the declaration,
bylaws, or other condominium instruments, but authorizes
a simple process of amendment requiring a lesser vote for
the purpose of correcting defects, errors, or omissions
when the property rights of the unit owners are not
materially or adversely affected.
(5) If there is an omission or error in the
declaration or other instruments that may not be
corrected by an amendment procedure set forth in
subdivision (h)(1) or (h)(2) of this Section, then the
circuit court in the county in which the master
association is located shall have jurisdiction to hear a
petition of one or more of the unit owners thereon or of
the association, to correct the error or omission, and
the action may be a class action. The court may require
that one or more methods of correcting the error or
omission be submitted to the unit owners to determine the
most acceptable correction. All unit owners in the
association must be joined as parties to the action.
Service of process on owners may be by publication, but
the plaintiff shall furnish all unit owners not
personally served with process with copies of the
petition and final judgment of the court by certified
mail, return receipt requested, at their last known
address.
(6) Nothing contained in this Section shall be
construed to invalidate any provision of a declaration
authorizing the developer to amend an instrument prior to
the latest date on which the initial membership meeting
of the unit owners must be held, whether or not it has
actually been held, to bring the instrument into
compliance with the legal requirements of the Federal
National Mortgage Association, the Federal Home Loan
Mortgage Corporation, the Federal Housing Administration,
the United States Veterans Administration or their
respective successors and assigns.
(i) The provisions of subsections (c) through (h) are
applicable to all declarations, other condominium
instruments, and other duly recorded covenants establishing
the powers and duties of the master association recorded
under this Act. Any portion of a declaration, other
condominium instrument, or other duly recorded covenant
establishing the powers and duties of a master association
which contains provisions contrary to the provisions of
subsection (c) through (h) shall be void as against public
policy and ineffective. Any declaration, other condominium
instrument, or other duly recorded covenant establishing the
powers and duties of the master association which fails to
contain the provisions required by subsections (c) through
(h) shall be deemed to incorporate such provisions by
operation of law.
(j) The provisions of subsections (c) through (h) are
applicable to all common interest community associations and
their unit owners for common interest community associations
which are subject to the provisions of Section 9-102(a)(8) of
the Code of Civil Procedure. For purposes of this
subsection, the terms "common interest community" and "unit
owners" shall have the same meaning as set forth in Section
9-102(c) of the Code of Civil Procedure.
(Source: P.A. 89-41, eff. 6-23-95.)
Section 99. Effective date. This Act takes effect upon
becoming law.