State of Illinois
91st General Assembly
Legislation

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[ Engrossed ][ Enrolled ][ House Amendment 001 ]
[ Senate Amendment 001 ]

91_SB0749

 
                                               LRB9103048DJcd

 1        AN ACT to amend the Illinois Business Brokers Act of 1995
 2    by changing Sections 10-105 and 10-115.

 3        Be  it  enacted  by  the People of the State of Illinois,
 4    represented in the General Assembly:

 5        Section  5.  The Illinois Business Brokers Act of 1995 is
 6    amended by changing Sections 10-105 and 10-115 as follows:

 7        (815 ILCS 307/10-105)
 8        Sec. 10-105.  Scope of the Act.   This  Act  shall  apply
 9    only  when  the  person engaged or sought to be engaged as by
10    the business broker is domiciled in this State  or  when  the
11    company or business sought to be sold has its principal place
12    of   business  in  this  State.   Notwithstanding  any  other
13    provision of this Section, a lien on property  arising  under
14    Section  10-115 is enforceable only against tangible property
15    located in this State.
16    (Source: P.A. 90-70, eff. 7-8-97.)

17        (815 ILCS 307/10-115)
18        Sec. 10-115. Business broker lien.
19        (a)  Any business broker  shall  have  a  lien  upon  the
20    tangible  assets  of a business located in this State that is
21    the subject of a business broker's written contract  and  the
22    proceeds  from the sale of such business in the amount due to
23    that the broker under the written contract is due.
24        (b)  The lien shall be available to the  business  broker
25    named in the instrument signed by the owner of an interest in
26    the  assets seller or purchaser.  The lien arising under this
27    Act shall be in addition to any other rights that a  business
28    broker may have.
29        (c)  The  lien  under  this  Act  shall  attach  upon the
30    business  broker  being  otherwise  entitled  to  a  fee   or
 
                            -2-                LRB9103048DJcd
 1    commission  under a written contract instrument signed by the
 2    seller or its purchaser or the  seller  or  purchaser's  duly
 3    authorized  agent,  as  applicable,  if,  before  the  actual
 4    conveyance  or  transfer  of  the business assets or property
 5    with  respect to which the  business  broker  is  claiming  a
 6    lien,  the business broker files a notice  of lien (i) in the
 7    recorder's office of the county in which the real property is
 8    located, as to  real property, and (ii) in the Office of  the
 9    Secretary of State, as to tangible personal  property.
10        (d)  When   payment  to  a  business  broker  is  due  in
11    installments, a portion  of  which  is  due  only  after  the
12    conveyance  or  transfer of the tangible assets business, any
13    claim for lien for those payments due after the  transfer  or
14    conveyance  may  be  filed  at  any  time  subsequent  to the
15    transfer or conveyance of the tangible  assets  business  and
16    prior  to the date on which the payment is due but shall only
17    be effective as a lien against the tangible  assets  business
18    or  proceeds  to  the  extent  moneys  are  still owed to the
19    transferor by the transferee. The lien shall attach as of the
20    filing of the notice of lien and not relate back to the  date
21    of the written agreement.
22        (e)  If  a business broker has a written agreement with a
23    prospective purchaser or seller, then the lien  shall  attach
24    upon  the prospective purchaser or seller that is purchasing,
25    selling, or otherwise accepting a conveyance or  transfer  of
26    the  real property or tangible personal property business and
27    the filing of a notice of lien pursuant to subsection (c)  by
28    the  business  broker in the Office of the Secretary of State
29    within 90 days after the transfer to the purchaser  purchase,
30    sale, or other conveyance or transfer of the business that is
31    the subject of the written agreement with the business broker
32    .  The  lien  shall  attach  to the interest purchased by the
33    purchaser as of the date of the filing of the notice of  lien
34    and  does not relate back to the date of the written contract
 
                            -3-                LRB9103048DJcd
 1    receipt of any consideration by the seller  of  the  business
 2    that  is  the  subject  of  the  written  agreement  with the
 3    business broker.
 4        (f)  The business broker  shall,  within  10  days  after
 5    filing its notice of lien, mail a copy of the  notice of lien
 6    to the owner of the property business by depositing it in the
 7    United States mail, registered or certified mail, with return
 8    receipt  requested,  or personally serve a copy of the notice
 9    served on the owner of record or his agent.  If the  lien  is
10    filed within 10 days prior to closing, the business broker is
11    not required to mail or personally serve a copy of the notice
12    of  lien.   Mailing  of  the  copy  of  the notice of lien is
13    effective if mailed to the address of the  business  that  is
14    the  subject  of the notice of lien, or to such other address
15    as the seller or  purchaser  has  provided  to  the  business
16    broker  in  writing  and  signed  by the seller or purchaser.
17    Mailing of the copy of  the  notice  of  claim  for  lien  is
18    effective  if  mailed  to  the  seller  at the address of the
19    business that is the subject of the notice of  lien    or  to
20    another  address that the seller or purchaser has provided in
21    writing to the business  broker when deposited  in  a  United
22    States mailbox with postage prepaid.  The broker's lien shall
23    be unenforceable if mailing of the copy of the notice of lien
24    does not occur at the time and in the manner required by this
25    Act.
26        (g)  A  business  broker may bring suit to enforce a lien
27    in the circuit  court  (i)  in  the  county  where  the  real
28    property  headquarters of the business being sold is located,
29    as  to  real  property,  or  (ii)  as  to  tangible  personal
30    property, either in the county where the   personal  property
31    is  located or where the principal office of the owner of the
32    personal  property, or  the  owner's  residence,  is  located
33    where  the  purchaser resides (or maintains its headquarters)
34    if the lien is being filed against the  purchaser,  or  where
 
                            -4-                LRB9103048DJcd
 1    the  seller  resides  (or  maintains its headquarters) if the
 2    lien is filed against the seller, by filing a  complaint  and
 3    sworn affidavit that the lien has been filed.
 4        (h)  The  person  claiming  a  lien shall, within 2 years
 5    after filing the  lien,  commence  proceedings  by  filing  a
 6    complaint.   Failure  to  commence proceedings within 2 years
 7    after  filing  the  lien  shall  extinguish  the  lien.    No
 8    subsequent notice of lien may be given for the same claim nor
 9    may that claim be asserted in any proceedings under this Act.
10        (i)  A  complaint  under this Section shall have attached
11    to it a  copy  contain  a  brief  statement  of  the  written
12    contract or agreements on which the lien is founded and shall
13    contain,  the date when the contract or agreement was made, a
14    description of the services performed,  the  amount  due  and
15    unpaid,  a description of the tangible assets of the business
16    that is, or the proceeds from sale of which are,  subject  to
17    the  lien, and other facts necessary for a full understanding
18    of the rights of the parties.  The plaintiff shall  make  all
19    interested  parties,  of  whose  interest  the  plaintiff  is
20    notified or has knowledge, defendants to the action and shall
21    issue  summons and provide service as in other civil actions.
22    When any defendant resides or has gone out of the  State,  or
23    on inquiry cannot be found, or is concealed within this State
24    so  that  process  cannot  be  served  on that defendant, the
25    plaintiff shall cause a notice to be given to that defendant,
26    or cause a copy of the  complaint  to  be  served  upon  that
27    defendant,  in  the manner and upon the same conditions as in
28    other civil actions.  Failure of  the  plaintiff  to  provide
29    proper  summons  or  notice  shall  be  grounds  for judgment
30    against the plaintiff  with  prejudice.  Every  lien  claimed
31    under  this  Act  shall  be  foreclosed  as  provided  in the
32    Illinois Mortgage  Foreclosure Law, if the lien  is  on  real
33    property,  or  as provided in the Uniform Commercial Code, if
34    the lien is on personal property.
 
                            -5-                LRB9103048DJcd
 1        (j)  The lien notice shall state the name and address  of
 2    the  claimant,  the  name  of  the  purchaser or seller whose
 3    property or assets are subject to the lien, a description  of
 4    the  real  or  personal  property that is subject to the lien
 5    business upon which or upon the proceeds  from  the  sale  of
 6    which  the  lien  is  being claimed, the amount for which the
 7    lien is claimed, and the registration number of the  business
 8    broker.  The notice of lien shall recite that the information
 9    contained in the notice is true and accurate to the knowledge
10    of  the signer signatory.  The notice of lien shall be signed
11    by the  business broker or by a person authorized to sign  on
12    behalf of the business broker and shall be verified.
13        (k)  Whenever  a  claim  for lien has been filed with the
14    Office of the Secretary of State  or  the  county  recorder's
15    office  and  a  condition  occurs  that  would  preclude  the
16    business  broker  from receiving compensation under the terms
17    of the business  broker's  written  agreement,  the  business
18    broker shall provide to the purchaser of the business, if the
19    lien  is  filed  against the purchaser's assets purchaser, or
20    the seller of the business, if the lien is filed against the
21    seller's assets seller, within 10 days  following  demand  by
22    that  party  the  owner  of  record,  a  written  release  or
23    satisfaction of the lien.
24        (l)  Upon  written  demand of the owner, lienee, or other
25    authorized agent, served on  the  person  claiming  the  lien
26    requiring  suit to be commenced to enforce the lien or answer
27    to be filed in a pending suit, a suit shall be  commenced  or
28    answer  filed within 30 days thereafter, or the lien shall be
29    extinguished.  Service may  be  by  registered  or  certified
30    mail, return receipt requested, or by personal service.
31        (m)  If  a  claim for lien has been filed with the Office
32    of the Secretary of State or the county recorder's office and
33    is paid, or if there  is  failure  to  institute  a  suit  to
34    enforce  the  lien  within the time provided by this Act, the
 
                            -6-                LRB9103048DJcd
 1    business broker shall acknowledge satisfaction or release  of
 2    the  lien,  in writing, on written demand of the purchaser of
 3    the business, if the lien is filed against the purchaser,  or
 4    the  seller of the business, if the lien is filed against the
 5    seller, within 5 days after payment or expiration of the time
 6    in which to file the lien.
 7        (n)  The cost  of  proceedings  brought  under  this  Act
 8    asserting  or  defending  a  business broker's claim of lien,
 9    including reasonable attorneys' fees, costs, and  prejudgment
10    interest  interests  due  to  the  prevailing party, shall be
11    borne by the nonprevailing party or parties.  When more  than
12    one  party  is  responsible  for costs, fees, and prejudgment
13    interest, the costs, fees, and prejudgment interest shall  be
14    equitably  apportioned  by  the court among those responsible
15    parties.
16        (o)  Prior  recorded  liens  and  mortgages  shall   have
17    priority  over  a broker's lien.  A prior recorded lien shall
18    include, without limitation,  (i)  a  valid  mechanic's  lien
19    claim  that  is recorded subsequent to the broker's notice of
20    lien but which relates back to a date prior to the  recording
21    date  of  the broker's notice of lien and (ii) prior recorded
22    liens securing revolving credit or and future advances under
23    of construction loans as described in Section 15-1302 of  the
24    Code of Civil Procedure.
25    (Source: P.A. 90-70, eff. 7-8-97.)

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