Illinois General Assembly - Full Text of SB0885
Illinois General Assembly

Previous General Assemblies

Full Text of SB0885  100th General Assembly

SB0885 100TH GENERAL ASSEMBLY

  
  

 


 
100TH GENERAL ASSEMBLY
State of Illinois
2017 and 2018
SB0885

 

Introduced 2/7/2017, by Sen. David Koehler

 

SYNOPSIS AS INTRODUCED:
 
New Act
735 ILCS 5/15-1106  from Ch. 110, par. 15-1106
765 ILCS 70/Act rep.
765 ILCS 75/Act rep.
765 ILCS 605/18  from Ch. 30, par. 318
765 ILCS 605/18.5  from Ch. 30, par. 318.5

    Repeals the Dwelling Structure Contract Act and the Dwelling Unit Installment Contract Act. Creates the Installment Sales Contract Act. Adds provisions governing: definitions; terms and conditions of installment sales contracts; applicability of other Acts; sales of condemned dwelling structures; repairs; account statements; transfer of payments; insurance proceeds; unlawful acts; waivers; and penalties. Makes corresponding changes in the Condominium Property Act. Amends the Code of Civil Procedure. Provides that a real estate installment contract for residential real estate is subject to the foreclosure provisions of the Code if the purchase price is to be paid in installments over a period in excess of one year (instead of 5 years) and the amount unpaid under the terms of the contract at the time of the filing of the foreclosure complaint, including principal and due and unpaid interest, at the rate prior to default, is less than 90% (instead of 80%) of the original purchase price of the real estate as stated in the contract. Effective January 1, 2018.


LRB100 05980 HEP 16008 b

 

 

A BILL FOR

 

SB0885LRB100 05980 HEP 16008 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 1. Short title. This Act may be cited as the
5Installment Sales Contract Act.
 
6    Section 5. Definitions. As used in this Act, unless the
7context otherwise requires:
8    "Amortization schedule" means a written schedule which
9sets forth the date of each periodic payment, the amount of
10each periodic payment that will be applied to the principal
11balance, and the amount of each periodic payment that will be
12applied to any interest charged, if applicable, pursuant to the
13contract.
14    "Balloon payment" means a payment, other than the initial
15down payment, in which more than the ordinary periodic payment
16is charged during the contract.
17    "Buyer" means the person who is obligated to make payments
18to the seller pursuant to the contract.
19    "Date of sale" means the date that the seller and buyer
20sign the written contract.
21    "Dwelling structure" means any private home or residence or
22any building or structure intended for residential use.
23    "Installment sales contract" or "contract" means any

 

 

SB0885- 2 -LRB100 05980 HEP 16008 b

1contract or agreement, including a contract for deed, bond for
2deed, or any other sale or legal device whereby a seller agrees
3to sell and the buyer agrees to buy a dwelling structure, in
4which the consideration for the sale is payable in installments
5for a period of at least one year after the buyer takes
6possession of the dwelling structure and the seller continues
7to have an interest or security for the purchase price or
8otherwise in the property.
9    "Seller" means the owner of a legal or beneficial interest
10in a dwelling structure, or the owner's agent, who utilizes an
11installment sales contract to sell the dwelling structure.
 
12    Section 10. Terms and conditions of installment sales
13contracts.
14    (a) The seller of residential real estate by installment
15sales contract, on the date of sale, shall provide the buyer
16with a written contract that complies with the requirements set
17forth in this Section.
18    (b) Until the buyer is provided with a copy of the
19contract, the buyer has the right to rescind the contract, in
20addition to all other remedies provided by this Act. Upon
21rescission pursuant to this Section, the seller shall refund to
22the buyer all money paid to the seller as of the date of
23rescission.
24    (c) An installment sales contract for the sale of a
25dwelling structure shall clearly and conspicuously disclose

 

 

SB0885- 3 -LRB100 05980 HEP 16008 b

1the following:
2        (1) The price of the dwelling structure.
3        (2) The amount, if any, of any down payment applied to
4    the price of the dwelling structure and the resulting
5    principal on the loan.
6        (3) The amount, if any, of any security deposit.
7        (4) The amount of the periodic payment.
8        (5) The interest rate being charged, if any, expressed
9    only as an annual percentage rate.
10        (6) The amount, if any, of any balloon payment.
11        (7) A statement outlining whether the seller or the
12    buyer is responsible for paying real estate taxes and
13    insurance and how responsibilities of the buyer and seller
14    change based on the time period the dwelling is occupied by
15    the buyer and what percentage of the principal is paid
16    down. In all circumstances not defined in the statement
17    required by this item, the seller has the responsibility of
18    paying real estate taxes and insurance.
19        (8) The amount that will be charged periodically, if
20    any, for the first year to pay real estate taxes.
21        (9) The amount that will be charged periodically, if
22    any, for the first year to pay insurance.
23        (10) A statement that the amounts listed in items (8)
24    and (9) of this subsection are subject to change each year.
25        (11) The assessed value of the property as set forth on
26    the real estate tax bill for the year immediately prior to

 

 

SB0885- 4 -LRB100 05980 HEP 16008 b

1    the sale.
2        (12) The amount of real estate taxes for the year
3    immediately prior to the sale.
4        (13) Any unpaid amounts owing on prior real estate
5    taxes.
6        (14) The amount of the annual insurance payment for the
7    year immediately prior to the sale.
8        (15) The type of insurance coverage that will be
9    required or provided.
10        (16) The seller's interest in the structure being sold.
11        (17) Any known liens or mortgages or other title
12    limitations existing on the property and an explanation of
13    the meaning of the liens, mortgages, or title limitations.
14        (18) An explanation as to when the buyer will obtain
15    the title.
16        (19) An explanation of the consequences of the failure
17    of the buyer to make timely payments before the title is
18    transferred.
19        (20) A statement defining what repairs the buyer is
20    financially responsible for, if any, and how
21    responsibilities of the buyer and seller to repair the
22    property change based on the time period the dwelling is
23    occupied by the buyer and what percentage of the principal
24    is paid down. In all circumstances not defined in this
25    item, the seller has responsibility for repairs.
26        (21) Any additional charges due.

 

 

SB0885- 5 -LRB100 05980 HEP 16008 b

1        (22) An amortization schedule.
2        (23) A certificate of compliance with applicable
3    dwelling codes, or in the absence of such a certificate:
4    (i) an express written warranty that no notice from any
5    municipality or other governmental authority of a dwelling
6    code violation that existed in the dwelling structure
7    before the installment sales contract was executed had been
8    received by the seller, his or her principal, or his or her
9    agent within 10 years of the date of execution of the
10    installment sales contract; or (ii) if any notice of a
11    violation had been received, a list of all such notices
12    with a detailed statement of all violations referred to in
13    the notice.
14        (24) A statement that the contract is subject to the
15    Lead Poisoning Prevention Act and that the seller has
16    complied with all obligations of an owner required by the
17    that Act.
18        (25) A statement indicating whether the terms of the
19    contract qualify as a high risk home loan as defined by the
20    High Risk Home Loan Act and, if the terms qualify as a high
21    risk home loan, that the seller has complied with all
22    obligations of a lender under the High Risk Home Loan Act.
23    (d) The requirements of this Section cannot be waived by
24the buyer or seller.
 
25    Section 15. Applicability of other Acts. An installment

 

 

SB0885- 6 -LRB100 05980 HEP 16008 b

1sales contract under this Act is subject to the Lead Poisoning
2Prevention Act and the High Risk Home Loan Act. This Act does
3not preclude any remedies available to a buyer under other law.
 
4    Section 20. Sales of condemned dwelling structures. The
5sale of a dwelling structure by installment sales contract is
6expressly prohibited if the structure has been condemned for
7demolition by the unit of government having jurisdiction.
 
8    Section 25. Recording of contract required.
9    (a) Within 5 business days of the date of sale of a
10dwelling structure by installment sales contract, and prior to
11any subsequent sale or other transfer of interest in the
12dwelling structure or contract by the seller, the seller shall
13record the contract with the county recorder of deeds.
14    (b) If the seller fails to record the contract as required
15by subsection (a) of this Section, the buyer has the right to
16rescind the contract until such time as the seller records the
17contract. If the seller fails to record the contract and title
18to the property becomes clouded for any reason, including, but
19not limited to, that another person buys the property, a
20judgment lien is placed on the property, or a consensual
21mortgage or some other third party interest affecting the title
22arises, the buyer has the option to rescind, not just before
23the seller records, but at any time within 90 days of
24discovering the title problem.

 

 

SB0885- 7 -LRB100 05980 HEP 16008 b

1    (c) Upon rescission under this Section, the seller shall
2refund to the buyer all money paid to the seller as of the date
3of rescission. This Section does not limit any other remedies
4provided to the buyer by this Act or State law.
 
5    Section 30. Repairs.
6    (a) In all cases not included in the statement required by
7item (20) of subsection (c) of Section 10, the seller has
8responsibility for repairs.
9    (b) If the seller deems certain repairs necessary to
10protect the seller's interest in the property, the seller may,
11at the seller's own cost, proceed to make the repairs in
12compliance with this Section. Before the performance of
13nonemergency repairs on a dwelling unit inhabited by a buyer,
14the seller shall provide the buyer with at least 72 hours'
15written notice of the seller's intent to make the proposed
16repairs.
17    (c) Nothing in this Section limits the buyer's right to
18obtain the services of a building contractor to make repairs
19that are chargeable to the buyer under this Act.
20    (d) No seller may require, by contract or otherwise, that
21only the seller or an agent of the seller may make repairs on a
22dwelling structure and adjacent property. The buyer has the
23right to contract with other building contractors to make
24repairs for which the buyer is financially responsible.
 

 

 

SB0885- 8 -LRB100 05980 HEP 16008 b

1    Section 35. Account statements.
2    (a) Except as provided in subsection (b), at least once
3annually and upon the buyer's demand the seller shall, without
4charge, provide the buyer with an account statement showing
5payments made during the past year, the principal balance on
6the contract, and an amortization schedule.
7    (b) A seller is not required to provide a buyer with
8account statements without charge more than once in any 3-month
9period unless the buyer's request is made in response to a
10change in the amount of the buyer's periodic payment amount;
11however, the seller may not charge the buyer more than the
12reasonable costs of copying and producing the account
13statement.
 
14    Section 40. Transfer of payments. The seller shall duly
15record and credit the account of a buyer for all payments made
16on the principal balance of the installment sales contract. A
17seller shall not use payments for any purpose other than to
18reduce the principal and interest due in accordance with the
19most recent amortization schedule required under Section 30 or
20to pay property taxes and insurance, unless the seller first
21obtains from the buyer a written, signed consent to another use
22of the funds.
 
23    Section 45. Insurance proceeds. A seller who receives
24payment of insurance proceeds as a result of damage to a

 

 

SB0885- 9 -LRB100 05980 HEP 16008 b

1dwelling structure shall apply the proceeds to the repair of
2the damage.
 
3    Section 50. Unlawful acts. It is a violation of this Act
4for a seller to make an oral or written misrepresentation to a
5buyer concerning a contract or regarding the buyer's rights or
6the seller's duties under this Act or to induce a buyer to sign
7incomplete forms, contracts, notices, or written statements
8relating to the sale of a dwelling structure.
 
9    Section 55. No waiver. The provisions of this Act may not
10be waived by written contract or otherwise. Any contractual
11provisions or other agreements contrary to this Act are void
12and unenforceable. It is a violation of this Act to
13intentionally include in a written contract any provision that
14is contrary to this Act or any other requirement by a seller
15that is contrary to this Act.
 
16    Section 60. Penalties. A person who knowingly violates this
17Act or fails to perform any duty prescribed by this Act or
18discloses any information required by this Act that he or she
19knows to be false shall be liable in the amount of actual
20damages and court costs, and the court may award reasonable
21attorney's fees incurred by the prevailing party.
 
22    Section 905. The Code of Civil Procedure is amended by

 

 

SB0885- 10 -LRB100 05980 HEP 16008 b

1changing Section 15-1106 as follows:
 
2    (735 ILCS 5/15-1106)  (from Ch. 110, par. 15-1106)
3    Sec. 15-1106. Applicability of Article.
4    (a) Exclusive Procedure. From and after July 1, 1987 (the
5effective date of Public Act 84-1462) this amendatory Act of
61986, the following shall be foreclosed in a foreclosure
7pursuant to this Article:
8        (1) any mortgage created prior to, on or after July 1,
9    1987 (the effective date of Public Act 84-1462) this
10    amendatory Act of 1986;
11        (2) any real estate installment contract for
12    residential real estate entered into on or after July 1,
13    1987 (the effective date of Public Act 84-1462) this
14    amendatory Act of 1986 and under which (i) the purchase
15    price is to be paid in installments over a period in excess
16    of one year five years and (ii) the amount unpaid under the
17    terms of the contract at the time of the filing of the
18    foreclosure complaint, including principal and due and
19    unpaid interest, at the rate prior to default, is less than
20    90% 80% of the original purchase price of the real estate
21    as stated in the contract;
22        (3) any collateral assignment of beneficial interest
23    made on or after July 1, 1987 (the effective date of Public
24    Act 84-1462) this amendatory Act of 1986 (i) which is made
25    with respect to a land trust which was created

 

 

SB0885- 11 -LRB100 05980 HEP 16008 b

1    contemporaneously with the collateral assignment of
2    beneficial interest, (ii) which is made pursuant to a
3    requirement of the holder of the obligation to secure the
4    payment of money or performance of other obligations and
5    (iii) as to which the security agreement or other writing
6    creating the collateral assignment permits the real estate
7    which is the subject of the land trust to be sold to
8    satisfy the obligations.
9    (b) Uniform Commercial Code. A secured party, as defined in
10Article 9 of the Uniform Commercial Code, may at its election
11enforce its security interest in a foreclosure under this
12Article if its security interest was created on or after July
131, 1987 (the effective date of Public Act 84-1462) this
14amendatory Act of 1986 and is created by (i) a collateral
15assignment of beneficial interest in a land trust or (ii) an
16assignment for security of a buyer's interest in a real estate
17installment contract. Such election shall be made by filing a
18complaint stating that it is brought under this Article, in
19which event the provisions of this Article shall be exclusive
20in such foreclosure.
21    (c) Real Estate Installment Contracts. A contract seller
22may at its election enforce in a foreclosure under this Article
23any real estate installment contract entered into on or after
24July 1, 1987 (the effective date of Public Act 84-1462) this
25Amendatory Act of 1986 and not required to be foreclosed under
26this Article. Such election shall be made by filing a complaint

 

 

SB0885- 12 -LRB100 05980 HEP 16008 b

1stating that it is brought under this Article, in which event
2the provisions of this Article shall be exclusive in such
3foreclosure. A contract seller must enforce its contract under
4this Article if the real estate installment contract is one
5described in paragraph (2) of subsection (a) of this Section
615-1106.
7    (d) Effect of Election. An election made pursuant to
8subsection (b) or (c) of this Section 15-1106 shall be binding
9only in the foreclosure and shall be void if the foreclosure is
10terminated prior to entry of judgment.
11    (e) Supplementary General Principles of Law. General
12principles of law and equity, such as those relating to
13capacity to contract, principal and agent, marshalling of
14assets, priority, subrogation, estoppel, fraud,
15misrepresentations, duress, collusion, mistake, bankruptcy or
16other validating or invalidating cause, supplement this
17Article unless displaced by a particular provision of it.
18Section 9-110 of this the Code of Civil Procedure shall not be
19applicable to any real estate installment contract which is
20foreclosed under this Article.
21    (f) Pending Actions. A complaint to foreclose a mortgage
22filed before July 1, 1987, and all proceedings and third party
23actions in connection therewith, shall be adjudicated pursuant
24to the Illinois statutes and applicable law in effect
25immediately prior to July 1, 1987. Such statutes shall remain
26in effect with respect to such complaint, proceedings and third

 

 

SB0885- 13 -LRB100 05980 HEP 16008 b

1party actions notwithstanding the amendment or repeal of such
2statutes on or after July 1, 1987.
3(Source: P.A. 85-907.)
 
4    (765 ILCS 70/Act rep.)
5    Section 910. The Dwelling Structure Contract Act is
6repealed.
 
7    (765 ILCS 75/Act rep.)
8    Section 915. The Dwelling Unit Installment Contract Act is
9repealed.
 
10    Section 920. The Condominium Property Act is amended by
11changing Sections 18 and 18.5 as follows:
 
12    (765 ILCS 605/18)  (from Ch. 30, par. 318)
13    Sec. 18. Contents of bylaws. The bylaws shall provide for
14at least the following:
15        (a)(1) The election from among the unit owners of a
16    board of managers, the number of persons constituting such
17    board, and that the terms of at least one-third of the
18    members of the board shall expire annually and that all
19    members of the board shall be elected at large; if there
20    are multiple owners of a single unit, only one of the
21    multiple owners shall be eligible to serve as a member of
22    the board at any one time;

 

 

SB0885- 14 -LRB100 05980 HEP 16008 b

1        (2) the powers and duties of the board;
2        (3) the compensation, if any, of the members of the
3    board;
4        (4) the method of removal from office of members of the
5    board;
6        (5) that the board may engage the services of a manager
7    or managing agent;
8        (6) that each unit owner shall receive, at least 25
9    days prior to the adoption thereof by the board of
10    managers, a copy of the proposed annual budget together
11    with an indication of which portions are intended for
12    reserves, capital expenditures or repairs or payment of
13    real estate taxes;
14        (7) that the board of managers shall annually supply to
15    all unit owners an itemized accounting of the common
16    expenses for the preceding year actually incurred or paid,
17    together with an indication of which portions were for
18    reserves, capital expenditures or repairs or payment of
19    real estate taxes and with a tabulation of the amounts
20    collected pursuant to the budget or assessment, and showing
21    the net excess or deficit of income over expenditures plus
22    reserves;
23        (8)(i) that each unit owner shall receive notice, in
24    the same manner as is provided in this Act for membership
25    meetings, of any meeting of the board of managers
26    concerning the adoption of the proposed annual budget and

 

 

SB0885- 15 -LRB100 05980 HEP 16008 b

1    regular assessments pursuant thereto or to adopt a separate
2    (special) assessment, (ii) that except as provided in
3    subsection (iv) below, if an adopted budget or any separate
4    assessment adopted by the board would result in the sum of
5    all regular and separate assessments payable in the current
6    fiscal year exceeding 115% of the sum of all regular and
7    separate assessments payable during the preceding fiscal
8    year, the board of managers, upon written petition by unit
9    owners with 20 percent of the votes of the association
10    delivered to the board within 14 days of the board action,
11    shall call a meeting of the unit owners within 30 days of
12    the date of delivery of the petition to consider the budget
13    or separate assessment; unless a majority of the total
14    votes of the unit owners are cast at the meeting to reject
15    the budget or separate assessment, it is ratified, (iii)
16    that any common expense not set forth in the budget or any
17    increase in assessments over the amount adopted in the
18    budget shall be separately assessed against all unit
19    owners, (iv) that separate assessments for expenditures
20    relating to emergencies or mandated by law may be adopted
21    by the board of managers without being subject to unit
22    owner approval or the provisions of item (ii) above or item
23    (v) below. As used herein, "emergency" means an immediate
24    danger to the structural integrity of the common elements
25    or to the life, health, safety or property of the unit
26    owners, (v) that assessments for additions and alterations

 

 

SB0885- 16 -LRB100 05980 HEP 16008 b

1    to the common elements or to association-owned property not
2    included in the adopted annual budget, shall be separately
3    assessed and are subject to approval of two-thirds of the
4    total votes of all unit owners, (vi) that the board of
5    managers may adopt separate assessments payable over more
6    than one fiscal year. With respect to multi-year
7    assessments not governed by items (iv) and (v), the entire
8    amount of the multi-year assessment shall be deemed
9    considered and authorized in the first fiscal year in which
10    the assessment is approved;
11        (9)(A) that every meeting of the board of managers
12    shall be open to any unit owner, except that the board may
13    close any portion of a noticed meeting or meet separately
14    from a noticed meeting to: (i) discuss litigation when an
15    action against or on behalf of the particular association
16    has been filed and is pending in a court or administrative
17    tribunal, or when the board of managers finds that such an
18    action is probable or imminent, (ii) discuss the
19    appointment, employment, engagement, or dismissal of an
20    employee, independent contractor, agent, or other provider
21    of goods and services, (iii) interview a potential
22    employee, independent contractor, agent, or other provider
23    of goods and services, (iv) discuss violations of rules and
24    regulations of the association, (v) discuss a unit owner's
25    unpaid share of common expenses, or (vi) consult with the
26    association's legal counsel; that any vote on these matters

 

 

SB0885- 17 -LRB100 05980 HEP 16008 b

1    shall take place at a meeting of the board of managers or
2    portion thereof open to any unit owner;
3        (B) that board members may participate in and act at
4    any meeting of the board of managers in person, by
5    telephonic means, or by use of any acceptable technological
6    means whereby all persons participating in the meeting can
7    communicate with each other; that participation
8    constitutes attendance and presence in person at the
9    meeting;
10        (C) that any unit owner may record the proceedings at
11    meetings of the board of managers or portions thereof
12    required to be open by this Act by tape, film or other
13    means, and that the board may prescribe reasonable rules
14    and regulations to govern the right to make such
15    recordings;
16        (D) that notice of every meeting of the board of
17    managers shall be given to every board member at least 48
18    hours prior thereto, unless the board member waives notice
19    of the meeting pursuant to subsection (a) of Section 18.8;
20    and
21        (E) that notice of every meeting of the board of
22    managers shall be posted in entranceways, elevators, or
23    other conspicuous places in the condominium at least 48
24    hours prior to the meeting of the board of managers except
25    where there is no common entranceway for 7 or more units,
26    the board of managers may designate one or more locations

 

 

SB0885- 18 -LRB100 05980 HEP 16008 b

1    in the proximity of these units where the notices of
2    meetings shall be posted; that notice of every meeting of
3    the board of managers shall also be given at least 48 hours
4    prior to the meeting, or such longer notice as this Act may
5    separately require, to: (i) each unit owner who has
6    provided the association with written authorization to
7    conduct business by acceptable technological means, and
8    (ii) to the extent that the condominium instruments of an
9    association require, to each other unit owner, as required
10    by subsection (f) of Section 18.8, by mail or delivery, and
11    that no other notice of a meeting of the board of managers
12    need be given to any unit owner;
13        (10) that the board shall meet at least 4 times
14    annually;
15        (11) that no member of the board or officer shall be
16    elected for a term of more than 2 years, but that officers
17    and board members may succeed themselves;
18        (12) the designation of an officer to mail and receive
19    all notices and execute amendments to condominium
20    instruments as provided for in this Act and in the
21    condominium instruments;
22        (13) the method of filling vacancies on the board which
23    shall include authority for the remaining members of the
24    board to fill the vacancy by two-thirds vote until the next
25    annual meeting of unit owners or for a period terminating
26    no later than 30 days following the filing of a petition

 

 

SB0885- 19 -LRB100 05980 HEP 16008 b

1    signed by unit owners holding 20% of the votes of the
2    association requesting a meeting of the unit owners to fill
3    the vacancy for the balance of the term, and that a meeting
4    of the unit owners shall be called for purposes of filling
5    a vacancy on the board no later than 30 days following the
6    filing of a petition signed by unit owners holding 20% of
7    the votes of the association requesting such a meeting, and
8    the method of filling vacancies among the officers that
9    shall include the authority for the members of the board to
10    fill the vacancy for the unexpired portion of the term;
11        (14) what percentage of the board of managers, if other
12    than a majority, shall constitute a quorum;
13        (15) provisions concerning notice of board meetings to
14    members of the board;
15        (16) the board of managers may not enter into a
16    contract with a current board member or with a corporation
17    or partnership in which a board member or a member of the
18    board member's immediate family has 25% or more interest,
19    unless notice of intent to enter the contract is given to
20    unit owners within 20 days after a decision is made to
21    enter into the contract and the unit owners are afforded an
22    opportunity by filing a petition, signed by 20% of the unit
23    owners, for an election to approve or disapprove the
24    contract; such petition shall be filed within 20 days after
25    such notice and such election shall be held within 30 days
26    after filing the petition; for purposes of this subsection,

 

 

SB0885- 20 -LRB100 05980 HEP 16008 b

1    a board member's immediate family means the board member's
2    spouse, parents, and children;
3        (17) that the board of managers may disseminate to unit
4    owners biographical and background information about
5    candidates for election to the board if (i) reasonable
6    efforts to identify all candidates are made and all
7    candidates are given an opportunity to include
8    biographical and background information in the information
9    to be disseminated; and (ii) the board does not express a
10    preference in favor of any candidate;
11        (18) any proxy distributed for board elections by the
12    board of managers gives unit owners the opportunity to
13    designate any person as the proxy holder, and gives the
14    unit owner the opportunity to express a preference for any
15    of the known candidates for the board or to write in a
16    name;
17        (19) that special meetings of the board of managers can
18    be called by the president or 25% of the members of the
19    board;
20        (20) that the board of managers may establish and
21    maintain a system of master metering of public utility
22    services and collect payments in connection therewith,
23    subject to the requirements of the Tenant Utility Payment
24    Disclosure Act; and
25        (21) that the board may ratify and confirm actions of
26    the members of the board taken in response to an emergency,

 

 

SB0885- 21 -LRB100 05980 HEP 16008 b

1    as that term is defined in subdivision (a)(8)(iv) of this
2    Section; that the board shall give notice to the unit
3    owners of: (i) the occurrence of the emergency event within
4    7 business days after the emergency event, and (ii) the
5    general description of the actions taken to address the
6    event within 7 days after the emergency event.
7        The intent of the provisions of Public Act 99-472
8    adding this paragraph (21) is to empower and support boards
9    to act in emergencies.
10        (b)(1) What percentage of the unit owners, if other
11    than 20%, shall constitute a quorum provided that, for
12    condominiums with 20 or more units, the percentage of unit
13    owners constituting a quorum shall be 20% unless the unit
14    owners holding a majority of the percentage interest in the
15    association provide for a higher percentage, provided that
16    in voting on amendments to the association's bylaws, a unit
17    owner who is in arrears on the unit owner's regular or
18    separate assessments for 60 days or more, shall not be
19    counted for purposes of determining if a quorum is present,
20    but that unit owner retains the right to vote on amendments
21    to the association's bylaws;
22        (2) that the association shall have one class of
23    membership;
24        (3) that the members shall hold an annual meeting, one
25    of the purposes of which shall be to elect members of the
26    board of managers;

 

 

SB0885- 22 -LRB100 05980 HEP 16008 b

1        (4) the method of calling meetings of the unit owners;
2        (5) that special meetings of the members can be called
3    by the president, board of managers, or by 20% of unit
4    owners;
5        (6) that written notice of any membership meeting shall
6    be mailed or delivered giving members no less than 10 and
7    no more than 30 days notice of the time, place and purpose
8    of such meeting except that notice may be sent, to the
9    extent the condominium instruments or rules adopted
10    thereunder expressly so provide, by electronic
11    transmission consented to by the unit owner to whom the
12    notice is given, provided the director and officer or his
13    agent certifies in writing to the delivery by electronic
14    transmission;
15        (7) that voting shall be on a percentage basis, and
16    that the percentage vote to which each unit is entitled is
17    the percentage interest of the undivided ownership of the
18    common elements appurtenant thereto, provided that the
19    bylaws may provide for approval by unit owners in
20    connection with matters where the requisite approval on a
21    percentage basis is not specified in this Act, on the basis
22    of one vote per unit;
23        (8) that, where there is more than one owner of a unit,
24    if only one of the multiple owners is present at a meeting
25    of the association, he is entitled to cast all the votes
26    allocated to that unit, if more than one of the multiple

 

 

SB0885- 23 -LRB100 05980 HEP 16008 b

1    owners are present, the votes allocated to that unit may be
2    cast only in accordance with the agreement of a majority in
3    interest of the multiple owners, unless the declaration
4    expressly provides otherwise, that there is majority
5    agreement if any one of the multiple owners cast the votes
6    allocated to that unit without protest being made promptly
7    to the person presiding over the meeting by any of the
8    other owners of the unit;
9        (9)(A) except as provided in subparagraph (B) of this
10    paragraph (9) in connection with board elections, that a
11    unit owner may vote by proxy executed in writing by the
12    unit owner or by his duly authorized attorney in fact; that
13    the proxy must bear the date of execution and, unless the
14    condominium instruments or the written proxy itself
15    provide otherwise, is invalid after 11 months from the date
16    of its execution; to the extent the condominium instruments
17    or rules adopted thereunder expressly so provide, a vote or
18    proxy may be submitted by electronic transmission,
19    provided that any such electronic transmission shall
20    either set forth or be submitted with information from
21    which it can be determined that the electronic transmission
22    was authorized by the unit owner or the unit owner's proxy;
23        (B) that if a rule adopted at least 120 days before a
24    board election or the declaration or bylaws provide for
25    balloting as set forth in this subsection, unit owners may
26    not vote by proxy in board elections, but may vote only (i)

 

 

SB0885- 24 -LRB100 05980 HEP 16008 b

1    by submitting an association-issued ballot in person at the
2    election meeting or (ii) by submitting an
3    association-issued ballot to the association or its
4    designated agent by mail or other means of delivery
5    specified in the declaration, bylaws, or rule; that the
6    ballots shall be mailed or otherwise distributed to unit
7    owners not less than 10 and not more than 30 days before
8    the election meeting, and the board shall give unit owners
9    not less than 21 days' prior written notice of the deadline
10    for inclusion of a candidate's name on the ballots; that
11    the deadline shall be no more than 7 days before the
12    ballots are mailed or otherwise distributed to unit owners;
13    that every such ballot must include the names of all
14    candidates who have given the board or its authorized agent
15    timely written notice of their candidacy and must give the
16    person casting the ballot the opportunity to cast votes for
17    candidates whose names do not appear on the ballot; that a
18    ballot received by the association or its designated agent
19    after the close of voting shall not be counted; that a unit
20    owner who submits a ballot by mail or other means of
21    delivery specified in the declaration, bylaws, or rule may
22    request and cast a ballot in person at the election
23    meeting, and thereby void any ballot previously submitted
24    by that unit owner;
25        (B-5) that if a rule adopted at least 120 days before a
26    board election or the declaration or bylaws provide for

 

 

SB0885- 25 -LRB100 05980 HEP 16008 b

1    balloting as set forth in this subparagraph, unit owners
2    may not vote by proxy in board elections, but may vote only
3    (i) by submitting an association-issued ballot in person at
4    the election meeting; or (ii) by any acceptable
5    technological means as defined in Section 2 of this Act;
6    instructions regarding the use of electronic means for
7    voting shall be distributed to all unit owners not less
8    than 10 and not more than 30 days before the election
9    meeting, and the board shall give unit owners not less than
10    21 days' prior written notice of the deadline for inclusion
11    of a candidate's name on the ballots; the deadline shall be
12    no more than 7 days before the instructions for voting
13    using electronic or acceptable technological means is
14    distributed to unit owners; every instruction notice must
15    include the names of all candidates who have given the
16    board or its authorized agent timely written notice of
17    their candidacy and must give the person voting through
18    electronic or acceptable technological means the
19    opportunity to cast votes for candidates whose names do not
20    appear on the ballot; a unit owner who submits a vote using
21    electronic or acceptable technological means may request
22    and cast a ballot in person at the election meeting,
23    thereby voiding any vote previously submitted by that unit
24    owner;
25        (C) that if a written petition by unit owners with at
26    least 20% of the votes of the association is delivered to

 

 

SB0885- 26 -LRB100 05980 HEP 16008 b

1    the board within 14 days after the board's approval of a
2    rule adopted pursuant to subparagraph (B) or subparagraph
3    (B-5) of this paragraph (9), the board shall call a meeting
4    of the unit owners within 30 days after the date of
5    delivery of the petition; that unless a majority of the
6    total votes of the unit owners are cast at the meeting to
7    reject the rule, the rule is ratified;
8        (D) that votes cast by ballot under subparagraph (B) or
9    electronic or acceptable technological means under
10    subparagraph (B-5) of this paragraph (9) are valid for the
11    purpose of establishing a quorum;
12        (10) that the association may, upon adoption of the
13    appropriate rules by the board of managers, conduct
14    elections by secret ballot whereby the voting ballot is
15    marked only with the percentage interest for the unit and
16    the vote itself, provided that the board further adopt
17    rules to verify the status of the unit owner issuing a
18    proxy or casting a ballot; and further, that a candidate
19    for election to the board of managers or such candidate's
20    representative shall have the right to be present at the
21    counting of ballots at such election;
22        (11) that in the event of a resale of a condominium
23    unit the purchaser of a unit from a seller other than the
24    developer pursuant to an installment sales contract for
25    purchase shall during such times as he or she resides in
26    the unit be counted toward a quorum for purposes of

 

 

SB0885- 27 -LRB100 05980 HEP 16008 b

1    election of members of the board of managers at any meeting
2    of the unit owners called for purposes of electing members
3    of the board, shall have the right to vote for the election
4    of members of the board of managers and to be elected to
5    and serve on the board of managers unless the seller
6    expressly retains in writing any or all of such rights. In
7    no event may the seller and purchaser both be counted
8    toward a quorum, be permitted to vote for a particular
9    office or be elected and serve on the board. Satisfactory
10    evidence of the installment sales contract shall be made
11    available to the association or its agents. For purposes of
12    this subsection, "installment sales contract" shall have
13    the same meaning as set forth in Section 5 of the
14    Installment Sales Contract Act Section 1(e) of the Dwelling
15    Unit Installment Contract Act;
16        (12) the method by which matters subject to the
17    approval of unit owners set forth in this Act, or in the
18    condominium instruments, will be submitted to the unit
19    owners at special membership meetings called for such
20    purposes; and
21        (13) that matters subject to the affirmative vote of
22    not less than 2/3 of the votes of unit owners at a meeting
23    duly called for that purpose, shall include, but not be
24    limited to:
25        (i) merger or consolidation of the association;
26        (ii) sale, lease, exchange, or other disposition

 

 

SB0885- 28 -LRB100 05980 HEP 16008 b

1        (excluding the mortgage or pledge) of all, or
2        substantially all of the property and assets of the
3        association; and
4        (iii) the purchase or sale of land or of units on
5        behalf of all unit owners.
6        (c) Election of a president from among the board of
7    managers, who shall preside over the meetings of the board
8    of managers and of the unit owners.
9        (d) Election of a secretary from among the board of
10    managers, who shall keep the minutes of all meetings of the
11    board of managers and of the unit owners and who shall, in
12    general, perform all the duties incident to the office of
13    secretary.
14        (e) Election of a treasurer from among the board of
15    managers, who shall keep the financial records and books of
16    account.
17        (f) Maintenance, repair and replacement of the common
18    elements and payments therefor, including the method of
19    approving payment vouchers.
20        (g) An association with 30 or more units shall obtain
21    and maintain fidelity insurance covering persons who
22    control or disburse funds of the association for the
23    maximum amount of coverage available to protect funds in
24    the custody or control of the association plus the
25    association reserve fund. All management companies which
26    are responsible for the funds held or administered by the

 

 

SB0885- 29 -LRB100 05980 HEP 16008 b

1    association shall maintain and furnish to the association a
2    fidelity bond for the maximum amount of coverage available
3    to protect funds in the custody of the management company
4    at any time. The association shall bear the cost of the
5    fidelity insurance and fidelity bond, unless otherwise
6    provided by contract between the association and a
7    management company. The association shall be the direct
8    obligee of any such fidelity bond. A management company
9    holding reserve funds of an association shall at all times
10    maintain a separate account for each association,
11    provided, however, that for investment purposes, the Board
12    of Managers of an association may authorize a management
13    company to maintain the association's reserve funds in a
14    single interest bearing account with similar funds of other
15    associations. The management company shall at all times
16    maintain records identifying all moneys of each
17    association in such investment account. The management
18    company may hold all operating funds of associations which
19    it manages in a single operating account but shall at all
20    times maintain records identifying all moneys of each
21    association in such operating account. Such operating and
22    reserve funds held by the management company for the
23    association shall not be subject to attachment by any
24    creditor of the management company.
25        For the purpose of this subsection, a management
26    company shall be defined as a person, partnership,

 

 

SB0885- 30 -LRB100 05980 HEP 16008 b

1    corporation, or other legal entity entitled to transact
2    business on behalf of others, acting on behalf of or as an
3    agent for a unit owner, unit owners or association of unit
4    owners for the purpose of carrying out the duties,
5    responsibilities, and other obligations necessary for the
6    day to day operation and management of any property subject
7    to this Act. For purposes of this subsection, the term
8    "fiduciary insurance coverage" shall be defined as both a
9    fidelity bond and directors and officers liability
10    coverage, the fidelity bond in the full amount of
11    association funds and association reserves that will be in
12    the custody of the association, and the directors and
13    officers liability coverage at a level as shall be
14    determined to be reasonable by the board of managers, if
15    not otherwise established by the declaration or by laws.
16        Until one year after September 21, 1985 (the effective
17    date of Public Act 84-722), if a condominium association
18    has reserves plus assessments in excess of $250,000 and
19    cannot reasonably obtain 100% fidelity bond coverage for
20    such amount, then it must obtain a fidelity bond coverage
21    of $250,000.
22        (h) Method of estimating the amount of the annual
23    budget, and the manner of assessing and collecting from the
24    unit owners their respective shares of such estimated
25    expenses, and of any other expenses lawfully agreed upon.
26        (i) That upon 10 days notice to the manager or board of

 

 

SB0885- 31 -LRB100 05980 HEP 16008 b

1    managers and payment of a reasonable fee, any unit owner
2    shall be furnished a statement of his account setting forth
3    the amount of any unpaid assessments or other charges due
4    and owing from such owner.
5        (j) Designation and removal of personnel necessary for
6    the maintenance, repair and replacement of the common
7    elements.
8        (k) Such restrictions on and requirements respecting
9    the use and maintenance of the units and the use of the
10    common elements, not set forth in the declaration, as are
11    designed to prevent unreasonable interference with the use
12    of their respective units and of the common elements by the
13    several unit owners.
14        (l) Method of adopting and of amending administrative
15    rules and regulations governing the operation and use of
16    the common elements.
17        (m) The percentage of votes required to modify or amend
18    the bylaws, but each one of the particulars set forth in
19    this section shall always be embodied in the bylaws.
20        (n)(i) The provisions of this Act, the declaration,
21    bylaws, other condominium instruments, and rules and
22    regulations that relate to the use of the individual unit
23    or the common elements shall be applicable to any person
24    leasing a unit and shall be deemed to be incorporated in
25    any lease executed or renewed on or after August 30, 1984
26    (the effective date of Public Act 83-1271).

 

 

SB0885- 32 -LRB100 05980 HEP 16008 b

1        (ii) With regard to any lease entered into subsequent
2    to July 1, 1990 (the effective date of Public Act 86-991),
3    the unit owner leasing the unit shall deliver a copy of the
4    signed lease to the board or if the lease is oral, a
5    memorandum of the lease, not later than the date of
6    occupancy or 10 days after the lease is signed, whichever
7    occurs first. In addition to any other remedies, by filing
8    an action jointly against the tenant and the unit owner, an
9    association may seek to enjoin a tenant from occupying a
10    unit or seek to evict a tenant under the provisions of
11    Article IX of the Code of Civil Procedure for failure of
12    the lessor-owner to comply with the leasing requirements
13    prescribed by this Section or by the declaration, bylaws,
14    and rules and regulations. The board of managers may
15    proceed directly against a tenant, at law or in equity, or
16    under the provisions of Article IX of the Code of Civil
17    Procedure, for any other breach by tenant of any covenants,
18    rules, regulations or bylaws.
19        (o) The association shall have no authority to forbear
20    the payment of assessments by any unit owner.
21        (p) That when 30% or fewer of the units, by number,
22    possess over 50% in the aggregate of the votes in the
23    association, any percentage vote of members specified
24    herein or in the condominium instruments shall require the
25    specified percentage by number of units rather than by
26    percentage of interest in the common elements allocated to

 

 

SB0885- 33 -LRB100 05980 HEP 16008 b

1    units that would otherwise be applicable and garage units
2    or storage units, or both, shall have, in total, no more
3    votes than their aggregate percentage of ownership in the
4    common elements; this shall mean that if garage units or
5    storage units, or both, are to be given a vote, or portion
6    of a vote, that the association must add the total number
7    of votes cast of garage units, storage units, or both, and
8    divide the total by the number of garage units, storage
9    units, or both, and multiply by the aggregate percentage of
10    ownership of garage units and storage units to determine
11    the vote, or portion of a vote, that garage units or
12    storage units, or both, have. For purposes of this
13    subsection (p), when making a determination of whether 30%
14    or fewer of the units, by number, possess over 50% in the
15    aggregate of the votes in the association, a unit shall not
16    include a garage unit or a storage unit.
17        (q) That a unit owner may not assign, delegate,
18    transfer, surrender, or avoid the duties,
19    responsibilities, and liabilities of a unit owner under
20    this Act, the condominium instruments, or the rules and
21    regulations of the Association; and that such an attempted
22    assignment, delegation, transfer, surrender, or avoidance
23    shall be deemed void.
24    The provisions of this Section are applicable to all
25condominium instruments recorded under this Act. Any portion of
26a condominium instrument which contains provisions contrary to

 

 

SB0885- 34 -LRB100 05980 HEP 16008 b

1these provisions shall be void as against public policy and
2ineffective. Any such instrument which fails to contain the
3provisions required by this Section shall be deemed to
4incorporate such provisions by operation of law.
5(Source: P.A. 98-1042, eff. 1-1-15; 99-472, eff. 6-1-16;
699-567, eff. 1-1-17; 99-642, eff. 7-28-16.)
 
7    (765 ILCS 605/18.5)  (from Ch. 30, par. 318.5)
8    Sec. 18.5. Master Associations.
9    (a) If the declaration, other condominium instrument, or
10other duly recorded covenants provide that any of the powers of
11the unit owners associations are to be exercised by or may be
12delegated to a nonprofit corporation or unincorporated
13association that exercises those or other powers on behalf of
14one or more condominiums, or for the benefit of the unit owners
15of one or more condominiums, such corporation or association
16shall be a master association.
17    (b) There shall be included in the declaration, other
18condominium instruments, or other duly recorded covenants
19establishing the powers and duties of the master association
20the provisions set forth in subsections (c) through (h).
21    In interpreting subsections (c) through (h), the courts
22should interpret these provisions so that they are interpreted
23consistently with the similar parallel provisions found in
24other parts of this Act.
25    (c) Meetings and finances.

 

 

SB0885- 35 -LRB100 05980 HEP 16008 b

1        (1) Each unit owner of a condominium subject to the
2    authority of the board of the master association shall
3    receive, at least 30 days prior to the adoption thereof by
4    the board of the master association, a copy of the proposed
5    annual budget.
6        (2) The board of the master association shall annually
7    supply to all unit owners of condominiums subject to the
8    authority of the board of the master association an
9    itemized accounting of the common expenses for the
10    preceding year actually incurred or paid, together with a
11    tabulation of the amounts collected pursuant to the budget
12    or assessment, and showing the net excess or deficit of
13    income over expenditures plus reserves.
14        (3) Each unit owner of a condominium subject to the
15    authority of the board of the master association shall
16    receive written notice mailed or delivered no less than 10
17    and no more than 30 days prior to any meeting of the board
18    of the master association concerning the adoption of the
19    proposed annual budget or any increase in the budget, or
20    establishment of an assessment.
21        (4) Meetings of the board of the master association
22    shall be open to any unit owner in a condominium subject to
23    the authority of the board of the master association,
24    except for the portion of any meeting held:
25            (A) to discuss litigation when an action against or
26        on behalf of the particular master association has been

 

 

SB0885- 36 -LRB100 05980 HEP 16008 b

1        filed and is pending in a court or administrative
2        tribunal, or when the board of the master association
3        finds that such an action is probable or imminent,
4            (B) to consider information regarding appointment,
5        employment or dismissal of an employee, or
6            (C) to discuss violations of rules and regulations
7        of the master association or unpaid common expenses
8        owed to the master association.
9    Any vote on these matters shall be taken at a meeting or
10    portion thereof open to any unit owner of a condominium
11    subject to the authority of the master association.
12        Any unit owner may record the proceedings at meetings
13    required to be open by this Act by tape, film or other
14    means; the board may prescribe reasonable rules and
15    regulations to govern the right to make such recordings.
16    Notice of meetings shall be mailed or delivered at least 48
17    hours prior thereto, unless a written waiver of such notice
18    is signed by the persons entitled to notice before the
19    meeting is convened. Copies of notices of meetings of the
20    board of the master association shall be posted in
21    entranceways, elevators, or other conspicuous places in
22    the condominium at least 48 hours prior to the meeting of
23    the board of the master association. Where there is no
24    common entranceway for 7 or more units, the board of the
25    master association may designate one or more locations in
26    the proximity of these units where the notices of meetings

 

 

SB0885- 37 -LRB100 05980 HEP 16008 b

1    shall be posted.
2        (5) If the declaration provides for election by unit
3    owners of members of the board of directors in the event of
4    a resale of a unit in the master association, the purchaser
5    of a unit from a seller other than the developer pursuant
6    to an installment sales contract for purchase shall, during
7    such times as he or she resides in the unit, be counted
8    toward a quorum for purposes of election of members of the
9    board of directors at any meeting of the unit owners called
10    for purposes of electing members of the board, and shall
11    have the right to vote for the election of members of the
12    board of directors and to be elected to and serve on the
13    board of directors unless the seller expressly retains in
14    writing any or all of those rights. In no event may the
15    seller and purchaser both be counted toward a quorum, be
16    permitted to vote for a particular office, or be elected
17    and serve on the board. Satisfactory evidence of the
18    installment sales contract shall be made available to the
19    association or its agents. For purposes of this subsection,
20    "installment sales contract" shall have the same meaning as
21    set forth in Section 5 of the Installment Sales Contract
22    Act subsection (e) of Section 1 of the Dwelling Unit
23    Installment Contract Act.
24        (6) The board of the master association shall have the
25    authority to establish and maintain a system of master
26    metering of public utility services and to collect payments

 

 

SB0885- 38 -LRB100 05980 HEP 16008 b

1    in connection therewith, subject to the requirements of the
2    Tenant Utility Payment Disclosure Act.
3        (7) The board of the master association or a common
4    interest community association shall have the power, after
5    notice and an opportunity to be heard, to levy and collect
6    reasonable fines from members for violations of the
7    declaration, bylaws, and rules and regulations of the
8    master association or the common interest community
9    association. Nothing contained in this subdivision (7)
10    shall give rise to a statutory lien for unpaid fines.
11        (8) Other than attorney's fees, no fees pertaining to
12    the collection of a unit owner's financial obligation to
13    the Association, including fees charged by a manager or
14    managing agent, shall be added to and deemed a part of an
15    owner's respective share of the common expenses unless: (i)
16    the managing agent fees relate to the costs to collect
17    common expenses for the Association; (ii) the fees are set
18    forth in a contract between the managing agent and the
19    Association; and (iii) the authority to add the management
20    fees to an owner's respective share of the common expenses
21    is specifically stated in the declaration or bylaws of the
22    Association.
23    (d) Records.
24        (1) The board of the master association shall maintain
25    the following records of the association and make them
26    available for examination and copying at convenient hours

 

 

SB0885- 39 -LRB100 05980 HEP 16008 b

1    of weekdays by any unit owners in a condominium subject to
2    the authority of the board or their mortgagees and their
3    duly authorized agents or attorneys:
4            (i) Copies of the recorded declaration, other
5        condominium instruments, other duly recorded covenants
6        and bylaws and any amendments, articles of
7        incorporation of the master association, annual
8        reports and any rules and regulations adopted by the
9        master association or its board shall be available.
10        Prior to the organization of the master association,
11        the developer shall maintain and make available the
12        records set forth in this subdivision (d)(1) for
13        examination and copying.
14            (ii) Detailed and accurate records in
15        chronological order of the receipts and expenditures
16        affecting the common areas, specifying and itemizing
17        the maintenance and repair expenses of the common areas
18        and any other expenses incurred, and copies of all
19        contracts, leases, or other agreements entered into by
20        the master association, shall be maintained.
21            (iii) The minutes of all meetings of the master
22        association and the board of the master association
23        shall be maintained for not less than 7 years.
24            (iv) Ballots and proxies related thereto, if any,
25        for any election held for the board of the master
26        association and for any other matters voted on by the

 

 

SB0885- 40 -LRB100 05980 HEP 16008 b

1        unit owners shall be maintained for not less than one
2        year.
3            (v) Such other records of the master association as
4        are available for inspection by members of a
5        not-for-profit corporation pursuant to Section 107.75
6        of the General Not For Profit Corporation Act of 1986
7        shall be maintained.
8            (vi) With respect to units owned by a land trust,
9        if a trustee designates in writing a person to cast
10        votes on behalf of the unit owner, the designation
11        shall remain in effect until a subsequent document is
12        filed with the association.
13        (2) Where a request for records under this subsection
14    is made in writing to the board of managers or its agent,
15    failure to provide the requested record or to respond
16    within 30 days shall be deemed a denial by the board of
17    directors.
18        (3) A reasonable fee may be charged by the master
19    association or its board for the cost of copying.
20        (4) If the board of directors fails to provide records
21    properly requested under subdivision (d)(1) within the
22    time period provided in subdivision (d)(2), the unit owner
23    may seek appropriate relief, including an award of
24    attorney's fees and costs.
25    (e) The board of directors shall have standing and capacity
26to act in a representative capacity in relation to matters

 

 

SB0885- 41 -LRB100 05980 HEP 16008 b

1involving the common areas of the master association or more
2than one unit, on behalf of the unit owners as their interests
3may appear.
4    (f) Administration of property prior to election of the
5initial board of directors.
6        (1) Until the election, by the unit owners or the
7    boards of managers of the underlying condominium
8    associations, of the initial board of directors of a master
9    association whose declaration is recorded on or after
10    August 10, 1990, the same rights, titles, powers,
11    privileges, trusts, duties and obligations that are vested
12    in or imposed upon the board of directors by this Act or in
13    the declaration or other duly recorded covenant shall be
14    held and performed by the developer.
15        (2) The election of the initial board of directors of a
16    master association whose declaration is recorded on or
17    after August 10, 1990, by the unit owners or the boards of
18    managers of the underlying condominium associations, shall
19    be held not later than 60 days after the conveyance by the
20    developer of 75% of the units, or 3 years after the
21    recording of the declaration, whichever is earlier. The
22    developer shall give at least 21 days notice of the meeting
23    to elect the initial board of directors and shall upon
24    request provide to any unit owner, within 3 working days of
25    the request, the names, addresses, and weighted vote of
26    each unit owner entitled to vote at the meeting. Any unit

 

 

SB0885- 42 -LRB100 05980 HEP 16008 b

1    owner shall upon receipt of the request be provided with
2    the same information, within 10 days of the request, with
3    respect to each subsequent meeting to elect members of the
4    board of directors.
5        (3) If the initial board of directors of a master
6    association whose declaration is recorded on or after
7    August 10, 1990 is not elected by the unit owners or the
8    members of the underlying condominium association board of
9    managers at the time established in subdivision (f)(2), the
10    developer shall continue in office for a period of 30 days,
11    whereupon written notice of his resignation shall be sent
12    to all of the unit owners or members of the underlying
13    condominium board of managers entitled to vote at an
14    election for members of the board of directors.
15        (4) Within 60 days following the election of a majority
16    of the board of directors, other than the developer, by
17    unit owners, the developer shall deliver to the board of
18    directors:
19            (i) All original documents as recorded or filed
20        pertaining to the property, its administration, and
21        the association, such as the declaration, articles of
22        incorporation, other instruments, annual reports,
23        minutes, rules and regulations, and contracts, leases,
24        or other agreements entered into by the association. If
25        any original documents are unavailable, a copy may be
26        provided if certified by affidavit of the developer, or

 

 

SB0885- 43 -LRB100 05980 HEP 16008 b

1        an officer or agent of the developer, as being a
2        complete copy of the actual document recorded or filed.
3            (ii) A detailed accounting by the developer,
4        setting forth the source and nature of receipts and
5        expenditures in connection with the management,
6        maintenance and operation of the property, copies of
7        all insurance policies, and a list of any loans or
8        advances to the association which are outstanding.
9            (iii) Association funds, which shall have been at
10        all times segregated from any other moneys of the
11        developer.
12            (iv) A schedule of all real or personal property,
13        equipment and fixtures belonging to the association,
14        including documents transferring the property,
15        warranties, if any, for all real and personal property
16        and equipment, deeds, title insurance policies, and
17        all tax bills.
18            (v) A list of all litigation, administrative
19        action and arbitrations involving the association, any
20        notices of governmental bodies involving actions taken
21        or which may be taken concerning the association,
22        engineering and architectural drawings and
23        specifications as approved by any governmental
24        authority, all other documents filed with any other
25        governmental authority, all governmental certificates,
26        correspondence involving enforcement of any

 

 

SB0885- 44 -LRB100 05980 HEP 16008 b

1        association requirements, copies of any documents
2        relating to disputes involving unit owners, and
3        originals of all documents relating to everything
4        listed in this subparagraph.
5            (vi) If the developer fails to fully comply with
6        this paragraph (4) within the 60 days provided and
7        fails to fully comply within 10 days of written demand
8        mailed by registered or certified mail to his or her
9        last known address, the board may bring an action to
10        compel compliance with this paragraph (4). If the court
11        finds that any of the required deliveries were not made
12        within the required period, the board shall be entitled
13        to recover its reasonable attorneys' fees and costs
14        incurred from and after the date of expiration of the
15        10 day demand.
16        (5) With respect to any master association whose
17    declaration is recorded on or after August 10, 1990, any
18    contract, lease, or other agreement made prior to the
19    election of a majority of the board of directors other than
20    the developer by or on behalf of unit owners or underlying
21    condominium associations, the association or the board of
22    directors, which extends for a period of more than 2 years
23    from the recording of the declaration, shall be subject to
24    cancellation by more than 1/2 of the votes of the unit
25    owners, other than the developer, cast at a special meeting
26    of members called for that purpose during a period of 90

 

 

SB0885- 45 -LRB100 05980 HEP 16008 b

1    days prior to the expiration of the 2 year period if the
2    board of managers is elected by the unit owners, otherwise
3    by more than 1/2 of the underlying condominium board of
4    managers. At least 60 days prior to the expiration of the 2
5    year period, the board of directors, or, if the board is
6    still under developer control, then the board of managers
7    or the developer shall send notice to every unit owner or
8    underlying condominium board of managers, notifying them
9    of this provision, of what contracts, leases and other
10    agreements are affected, and of the procedure for calling a
11    meeting of the unit owners or for action by the underlying
12    condominium board of managers for the purpose of acting to
13    terminate such contracts, leases or other agreements.
14    During the 90 day period the other party to the contract,
15    lease, or other agreement shall also have the right of
16    cancellation.
17        (6) The statute of limitations for any actions in law
18    or equity which the master association may bring shall not
19    begin to run until the unit owners or underlying
20    condominium board of managers have elected a majority of
21    the members of the board of directors.
22    (g) In the event of any resale of a unit in a master
23association by a unit owner other than the developer, the owner
24shall obtain from the board of directors and shall make
25available for inspection to the prospective purchaser, upon
26demand, the following:

 

 

SB0885- 46 -LRB100 05980 HEP 16008 b

1        (1) A copy of the declaration, other instruments and
2    any rules and regulations.
3        (2) A statement of any liens, including a statement of
4    the account of the unit setting forth the amounts of unpaid
5    assessments and other charges due and owing.
6        (3) A statement of any capital expenditures
7    anticipated by the association within the current or
8    succeeding 2 fiscal years.
9        (4) A statement of the status and amount of any reserve
10    for replacement fund and any portion of such fund earmarked
11    for any specified project by the board of directors.
12        (5) A copy of the statement of financial condition of
13    the association for the last fiscal year for which such a
14    statement is available.
15        (6) A statement of the status of any pending suits or
16    judgments in which the association is a party.
17        (7) A statement setting forth what insurance coverage
18    is provided for all unit owners by the association.
19        (8) A statement that any improvements or alterations
20    made to the unit, or any part of the common areas assigned
21    thereto, by the prior unit owner are in good faith believed
22    to be in compliance with the declaration of the master
23    association.
24    The principal officer of the unit owner's association or
25such other officer as is specifically designated shall furnish
26the above information when requested to do so in writing,

 

 

SB0885- 47 -LRB100 05980 HEP 16008 b

1within 30 days of receiving the request.
2    A reasonable fee covering the direct out-of-pocket cost of
3copying and providing such information may be charged by the
4association or its board of directors to the unit seller for
5providing the information.
6    (g-1) The purchaser of a unit of a common interest
7community at a judicial foreclosure sale, other than a
8mortgagee, who takes possession of a unit of a common interest
9community pursuant to a court order or a purchaser who acquires
10title from a mortgagee shall have the duty to pay the
11proportionate share, if any, of the common expenses for the
12unit that would have become due in the absence of any
13assessment acceleration during the 6 months immediately
14preceding institution of an action to enforce the collection of
15assessments and the court costs incurred by the association in
16an action to enforce the collection that remain unpaid by the
17owner during whose possession the assessments accrued. If the
18outstanding assessments and the court costs incurred by the
19association in an action to enforce the collection are paid at
20any time during any action to enforce the collection of
21assessments, the purchaser shall have no obligation to pay any
22assessments that accrued before he or she acquired title. The
23notice of sale of a unit of a common interest community under
24subsection (c) of Section 15-1507 of the Code of Civil
25Procedure shall state that the purchaser of the unit other than
26a mortgagee shall pay the assessments and court costs required

 

 

SB0885- 48 -LRB100 05980 HEP 16008 b

1by this subsection (g-1).
2    (h) Errors and omissions.
3        (1) If there is an omission or error in the declaration
4    or other instrument of the master association, the master
5    association may correct the error or omission by an
6    amendment to the declaration or other instrument, as may be
7    required to conform it to this Act, to any other applicable
8    statute, or to the declaration. The amendment shall be
9    adopted by vote of two-thirds of the members of the board
10    of directors or by a majority vote of the unit owners at a
11    meeting called for that purpose, unless the Act or the
12    declaration of the master association specifically
13    provides for greater percentages or different procedures.
14        (2) If, through a scrivener's error, a unit has not
15    been designated as owning an appropriate undivided share of
16    the common areas or does not bear an appropriate share of
17    the common expenses, or if all of the common expenses or
18    all of the common elements in the condominium have not been
19    distributed in the declaration, so that the sum total of
20    the shares of common areas which have been distributed or
21    the sum total of the shares of the common expenses fail to
22    equal 100%, or if it appears that more than 100% of the
23    common elements or common expenses have been distributed,
24    the error may be corrected by operation of law by filing an
25    amendment to the declaration, approved by vote of
26    two-thirds of the members of the board of directors or a

 

 

SB0885- 49 -LRB100 05980 HEP 16008 b

1    majority vote of the unit owners at a meeting called for
2    that purpose, which proportionately adjusts all percentage
3    interests so that the total is equal to 100%, unless the
4    declaration specifically provides for a different
5    procedure or different percentage vote by the owners of the
6    units and the owners of mortgages thereon affected by
7    modification being made in the undivided interest in the
8    common areas, the number of votes in the unit owners
9    association or the liability for common expenses
10    appertaining to the unit.
11        (3) If an omission or error or a scrivener's error in
12    the declaration or other instrument is corrected by vote of
13    two-thirds of the members of the board of directors
14    pursuant to the authority established in subdivisions
15    (h)(1) or (h)(2) of this Section, the board, upon written
16    petition by unit owners with 20% of the votes of the
17    association or resolutions adopted by the board of managers
18    or board of directors of the condominium and common
19    interest community associations which select 20% of the
20    members of the board of directors of the master
21    association, whichever is applicable, received within 30
22    days of the board action, shall call a meeting of the unit
23    owners or the boards of the condominium and common interest
24    community associations which select members of the board of
25    directors of the master association within 30 days of the
26    filing of the petition or receipt of the condominium and

 

 

SB0885- 50 -LRB100 05980 HEP 16008 b

1    common interest community association resolution to
2    consider the board action. Unless a majority of the votes
3    of the unit owners of the association are cast at the
4    meeting to reject the action, or board of managers or board
5    of directors of condominium and common interest community
6    associations which select over 50% of the members of the
7    board of the master association adopt resolutions prior to
8    the meeting rejecting the action of the board of directors
9    of the master association, it is ratified whether or not a
10    quorum is present.
11        (4) The procedures for amendments set forth in this
12    subsection (h) cannot be used if such an amendment would
13    materially or adversely affect property rights of the unit
14    owners unless the affected unit owners consent in writing.
15    This Section does not restrict the powers of the
16    association to otherwise amend the declaration, bylaws, or
17    other condominium instruments, but authorizes a simple
18    process of amendment requiring a lesser vote for the
19    purpose of correcting defects, errors, or omissions when
20    the property rights of the unit owners are not materially
21    or adversely affected.
22        (5) If there is an omission or error in the declaration
23    or other instruments that may not be corrected by an
24    amendment procedure set forth in subdivision (h)(1) or
25    (h)(2) of this Section, then the circuit court in the
26    county in which the master association is located shall

 

 

SB0885- 51 -LRB100 05980 HEP 16008 b

1    have jurisdiction to hear a petition of one or more of the
2    unit owners thereon or of the association, to correct the
3    error or omission, and the action may be a class action.
4    The court may require that one or more methods of
5    correcting the error or omission be submitted to the unit
6    owners to determine the most acceptable correction. All
7    unit owners in the association must be joined as parties to
8    the action. Service of process on owners may be by
9    publication, but the plaintiff shall furnish all unit
10    owners not personally served with process with copies of
11    the petition and final judgment of the court by certified
12    mail, return receipt requested, at their last known
13    address.
14        (6) Nothing contained in this Section shall be
15    construed to invalidate any provision of a declaration
16    authorizing the developer to amend an instrument prior to
17    the latest date on which the initial membership meeting of
18    the unit owners must be held, whether or not it has
19    actually been held, to bring the instrument into compliance
20    with the legal requirements of the Federal National
21    Mortgage Association, the Federal Home Loan Mortgage
22    Corporation, the Federal Housing Administration, the
23    United States Veterans Administration or their respective
24    successors and assigns.
25    (i) The provisions of subsections (c) through (h) are
26applicable to all declarations, other condominium instruments,

 

 

SB0885- 52 -LRB100 05980 HEP 16008 b

1and other duly recorded covenants establishing the powers and
2duties of the master association recorded under this Act. Any
3portion of a declaration, other condominium instrument, or
4other duly recorded covenant establishing the powers and duties
5of a master association which contains provisions contrary to
6the provisions of subsection (c) through (h) shall be void as
7against public policy and ineffective. Any declaration, other
8condominium instrument, or other duly recorded covenant
9establishing the powers and duties of the master association
10which fails to contain the provisions required by subsections
11(c) through (h) shall be deemed to incorporate such provisions
12by operation of law.
13    (j) (Blank).
14(Source: P.A. 96-1045, eff. 7-14-10; 97-535, eff. 1-1-12;
1597-605, eff. 8-26-11; 97-813, eff. 7-13-12.)
 
16    Section 999. Effective date. This Act takes effect January
171, 2018.