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Public Act 91-0534
SB749 Enrolled LRB9103048DJcd
AN ACT to amend the Illinois Business Brokers Act of 1995
by changing Sections 10-25, 10-105, and 10-115.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Illinois Business Brokers Act of 1995 is
amended by changing Sections 10-25, 10-105, and 10-115 as
follows:
(815 ILCS 307/10-25)
Sec. 10-25. Fees and funds. All fees and funds accruing
for the administration of this Act shall be accounted for by
the Secretary of State and shall be deposited with the State
Treasurer who shall deposit them in the Securities Audit and
Enforcement Fund.
(a) The Secretary of State shall, by rule or regulation,
impose and collect fees necessary for the administration of
this Act, including but not limited to, fees for the
following purposes:
(1) Filing an application pursuant to Section 10-10
of this Act;
(2) Examining an application pursuant to Sections
10-10 and 10-20 of this Act;
(3) Registering a business broker under Section
10-10 of this Act;
(4) Renewing registration of a business broker
pursuant to Section 10-20 of this Act;
(5) Failure to file or file timely any document or
information required under this Act;
(6) Filing a notice of lien with the Secretary of
State pursuant to Section 10-115 of this Act.
(b) The Secretary of State may, by rule or regulation,
raise or lower any fee imposed by, and which he or she is
authorized by law to collect under, this Act.
(Source: P.A. 89-209, eff. 1-1-96; 90-70, eff. 7-8-97.)
(815 ILCS 307/10-105)
Sec. 10-105. Scope of the Act. This Act shall apply
only when the person engaging or seeking to engage engaged or
sought to be engaged by the business broker is domiciled in
this State or when the company or business sought to be sold
has its principal place of business in this State.
Notwithstanding any other provision of this Section, a lien
on property arising under Section 10-115 is enforceable only
against tangible property located in this State.
(Source: P.A. 90-70, eff. 7-8-97.)
(815 ILCS 307/10-115)
Sec. 10-115. Business broker lien.
(a) Any business broker shall have a lien upon the
tangible assets of a business located in this State that is
the subject of a business broker's written contract and the
proceeds from the sale of such business in the amount due to
that the broker under the written contract is due.
(b) The lien shall be available to the business broker
named in the instrument signed by the owner of an interest in
the assets seller or purchaser. The lien arising under this
Act shall be in addition to any other rights that a business
broker may have.
(c) A The lien under this Act does not shall attach
unless and until: upon
(1) the business broker is being otherwise entitled
to a fee or commission under a written contract
instrument signed by the seller or its purchaser or the
seller or purchaser's duly authorized agent; and, as
applicable
(2) before the actual conveyance or transfer of the
business assets or property with respect to which the
business broker is claiming a lien, the business broker
files a notice of lien (i) as to real property, with the
recorder of the county in which the real property is
located or (ii) as to tangible personal property, in the
Office of the Secretary of State.
(d) When payment to a business broker is due in
installments, a portion of which is due only after the
conveyance or transfer of the tangible assets business, any
claim for lien for those payments due after the transfer or
conveyance may be filed at any time subsequent to the
transfer or conveyance of the tangible assets business and
prior to the date on which the payment is due but shall only
be effective as a lien against the tangible assets business
or proceeds to the extent moneys are still owed to the
transferor by the transferee. In all other respects, the lien
shall attach as described in this subsection of the filing of
the notice of lien and not relate back to the date of the
written agreement.
(e) If a business broker has a written agreement with a
prospective purchaser or seller, then the lien shall attach
upon the prospective purchaser or seller that is purchasing,
selling, or otherwise accepting a conveyance or transfer of
the real property or tangible personal property of the
business and the filing of a notice of lien (i) in the
recorder's office of the county in which the real property is
located, as to real property, and (ii) in the Office of the
Secretary of State, as to tangible personal property, by the
business broker in the Office of the Secretary of State
within 90 days after the transfer to the purchaser purchase,
sale, or other conveyance or transfer of the business that is
the subject of the written agreement with the business
broker. The lien shall attach to the interest purchased by
the purchaser as of the date of the filing of the notice of
lien and does not relate back to the date of the written
contract receipt of any consideration by the seller of the
business that is the subject of the written agreement with
the business broker.
(f) The business broker shall, within 10 days after
filing its notice of lien, mail a copy of the notice of lien
to the owner of the property business by depositing it in the
United States mail, registered or certified mail, with return
receipt requested, or personally serve a copy of the notice
served on the owner of record or his agent. If the lien is
filed within 10 days prior to closing, the business broker is
not required to mail or personally serve a copy of the notice
of lien. Mailing of the copy of the notice of lien is
effective if mailed to the address of the business that is
the subject of the notice of lien, or to such other address
as the seller or purchaser has provided to the business
broker in writing and signed by the seller or purchaser.
Mailing of the copy of the notice of claim for lien is
effective if mailed to the seller at the address of the
business that is the subject of the notice of lien or to
another address that the seller or purchaser has provided in
writing to the business broker when deposited in a United
States mailbox with postage prepaid. The broker's lien shall
be unenforceable if mailing of the copy of the notice of lien
does not occur at the time and in the manner required by this
Act.
(g) A business broker may bring suit to enforce a lien
in the circuit court (i) in the county where the real
property headquarters of the business being sold is located,
as to real property, or (ii) as to tangible personal
property, either in the county where the personal property
is located or where the principal office of the owner of the
personal property, or the owner's residence, is located
where the purchaser resides (or maintains its headquarters)
if the lien is being filed against the purchaser, or where
the seller resides (or maintains its headquarters) if the
lien is filed against the seller, by filing a complaint and
sworn affidavit that the lien has been filed.
(h) The person claiming a lien shall, within 2 years
after filing the lien, commence proceedings by filing a
complaint. Failure to commence proceedings within 2 years
after filing the lien shall extinguish the lien. No
subsequent notice of lien may be given for the same claim nor
may that claim be asserted in any proceedings under this Act.
(i) A complaint under this Section shall have attached
to it a copy contain a brief statement of the written
contract or agreements on which the lien is founded and shall
contain, the date when the contract or agreement was made, a
description of the services performed, the amount due and
unpaid, a description of the tangible assets of the business
that is, or the proceeds from sale of which are, subject to
the lien, and other facts necessary for a full understanding
of the rights of the parties. The plaintiff shall make all
interested parties, of whose interest the plaintiff is
notified or has actual or constructive knowledge, defendants
to the action and shall issue summons and provide service as
in other civil actions. When any defendant resides or has
gone out of the State, or on inquiry cannot be found, or is
concealed within this State so that process cannot be served
on that defendant, the plaintiff shall cause a notice to be
given to that defendant, or cause a copy of the complaint to
be served upon that defendant, in the manner and upon the
same conditions as in other civil actions. Failure of the
plaintiff to provide proper summons or notice shall be
grounds for judgment against the plaintiff with prejudice.
Every lien claimed under this Act shall be foreclosed as
provided in the Illinois Mortgage Foreclosure Law, if the
lien is on real property, or as provided in the Uniform
Commercial Code, if the lien is on personal property.
(j) The lien notice shall state the name and address of
the claimant, the name of the purchaser or seller whose
property or assets are subject to the lien, a description of
the real or personal property that is subject to the lien
business upon which or upon the proceeds from the sale of
which the lien is being claimed, the amount for which the
lien is claimed, and the registration number of the business
broker. The notice of lien shall recite that the information
contained in the notice is true and accurate to the knowledge
of the signer signatory. The notice of lien shall be signed
by the business broker or by a person authorized to sign on
behalf of the business broker and shall be verified.
(k) Whenever a claim for lien has been filed with the
Office of the Secretary of State or the county recorder's
office and a condition occurs that would preclude the
business broker from receiving compensation under the terms
of the business broker's written agreement, the business
broker shall provide to the purchaser of the business, if the
lien is filed against the purchaser's assets of the business
that are subject to this Act purchaser, or the seller of the
business, if the lien is filed against the seller's assets of
the business that are subject to this Act seller, within 10
days following demand by that party the owner of record, a
written release or satisfaction of the lien.
(l) Upon written demand of the owner, lienee, or other
authorized agent, served on the person claiming the lien
requiring suit to be commenced to enforce the lien or answer
to be filed in a pending suit, a suit shall be commenced or
answer filed within 30 days thereafter, or the lien shall be
extinguished. Service may be by registered or certified
mail, return receipt requested, or by personal service.
(m) If a claim for lien has been filed with the Office
of the Secretary of State or the county recorder's office and
is paid, or if there is failure to institute a suit to
enforce the lien within the time provided by this Act, the
business broker shall acknowledge satisfaction or release of
the lien, in writing, on written demand of the purchaser of
the business, if the lien is filed against the purchaser, or
the seller of the business, if the lien is filed against the
seller, within 5 days after payment or expiration of the time
in which to file the lien.
(n) The cost of proceedings brought under this Act
asserting or defending a business broker's claim of lien,
including reasonable attorneys' fees, costs, and prejudgment
interest interests due to the prevailing party, shall be
borne by the nonprevailing party or parties. When more than
one party is responsible for costs, fees, and prejudgment
interest, the costs, fees, and prejudgment interest shall be
equitably apportioned by the court among those responsible
parties.
(o) Prior recorded liens and mortgages shall have
priority over a broker's lien. A prior recorded lien shall
include, without limitation, (i) a valid mechanic's lien
claim, that is recorded subsequent to the broker's notice of
lien but which relates back to a date prior to the recording
date of the broker's notice of lien and (ii) prior recorded
liens securing revolving credit or and future advances under
of construction loans as described in Section 15-1302 of the
Code of Civil Procedure, and (iii) prior recorded liens
perfected under the Uniform Commercial Code.
(Source: P.A. 90-70, eff. 7-8-97.)
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