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90_SB0844enr
765 ILCS 605/18.5 from Ch. 30, par. 318.5
Amends the Condominium Property Act to provide that the
board of a master association or a community association
shall have the power to levy and collect fines from members
for violations of the association's declaration, bylaws, and
rules and regulations. Effective immediately.
LRB9003444NTsb
SB844 Enrolled LRB9003444NTsb
1 AN ACT to amend the Condominium Property Act by changing
2 Section 18.5.
3 Be it enacted by the People of the State of Illinois,
4 represented in the General Assembly:
5 Section 5. The Condominium Property Act is amended by
6 changing Section 18.5 as follows:
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
10 other duly recorded covenants provide that any of the powers
11 of the unit owners associations are to be exercised by or may
12 be delegated to a nonprofit corporation or unincorporated
13 association that exercises those or other powers on behalf of
14 one or more condominiums, or for the benefit of the unit
15 owners of one or more condominiums, such corporation or
16 association shall be a master association.
17 (b) There shall be included in the declaration, other
18 condominium instruments, or other duly recorded covenants
19 establishing the powers and duties of the master association
20 the provisions set forth in subsections (c) through (h).
21 In interpreting subsections (c) through (h), the courts
22 should interpret these provisions so that they are
23 interpreted consistently with the similar parallel provisions
24 found in other parts of this Act.
25 (c) Meetings and finances.
26 (1) Each unit owner of a condominium subject to the
27 authority of the board of the master association shall
28 receive, at least 30 days prior to the adoption thereof
29 by the board of the master association, a copy of the
30 proposed annual budget.
31 (2) The board of the master association shall
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1 annually supply to all unit owners of condominiums
2 subject to the authority of the board of the master
3 association an itemized accounting of the common expenses
4 for the preceding year actually incurred or paid,
5 together with a tabulation of the amounts collected
6 pursuant to the budget or assessment, and showing the net
7 excess or deficit of income over expenditures plus
8 reserves.
9 (3) Each unit owner of a condominium subject to the
10 authority of the board of the master association shall
11 receive written notice mailed or delivered no less than
12 10 and no more than 30 days prior to any meeting of the
13 board of the master association concerning the adoption
14 of the proposed annual budget or any increase in the
15 budget, or establishment of an assessment.
16 (4) Meetings of the board of the master association
17 shall be open to any unit owner in a condominium subject
18 to the authority of the board of the master association,
19 except for the portion of any meeting held:
20 (A) to discuss litigation when an action
21 against or on behalf of the particular master
22 association has been filed and is pending in a court
23 or administrative tribunal, or when the board of the
24 master association finds that such an action is
25 probable or imminent,
26 (B) to consider information regarding
27 appointment, employment or dismissal of an employee,
28 or
29 (C) to discuss violations of rules and
30 regulations of the master association or unpaid
31 common expenses owed to the master association.
32 Any vote on these matters shall be taken at a meeting or
33 portion thereof open to any unit owner of a condominium
34 subject to the authority of the master association.
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1 Any unit owner may record the proceedings at
2 meetings required to be open by this Act by tape, film or
3 other means; the board may prescribe reasonable rules and
4 regulations to govern the right to make such recordings.
5 Notice of meetings shall be mailed or delivered at least
6 48 hours prior thereto, unless a written waiver of such
7 notice is signed by the persons entitled to notice before
8 the meeting is convened. Copies of notices of meetings
9 of the board of the master association shall be posted in
10 entranceways, elevators, or other conspicuous places in
11 the condominium at least 48 hours prior to the meeting of
12 the board of the master association. Where there is no
13 common entranceway for 7 or more units, the board of the
14 master association may designate one or more locations in
15 the proximity of these units where the notices of
16 meetings shall be posted.
17 (5) If the declaration provides for election by
18 unit owners of members of the board of directors in the
19 event of a resale of a unit in the master association,
20 the purchaser of a unit from a seller other than the
21 developer pursuant to an installment contract for
22 purchase shall, during such times as he or she resides in
23 the unit, be counted toward a quorum for purposes of
24 election of members of the board of directors at any
25 meeting of the unit owners called for purposes of
26 electing members of the board, and shall have the right
27 to vote for the election of members of the board of
28 directors and to be elected to and serve on the board of
29 directors unless the seller expressly retains in writing
30 any or all of those rights. In no event may the seller
31 and purchaser both be counted toward a quorum, be
32 permitted to vote for a particular office, or be elected
33 and serve on the board. Satisfactory evidence of the
34 installment contract shall be made available to the
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1 association or its agents. For purposes of this
2 subsection, "installment contract" shall have the same
3 meaning as set forth in subsection (e) of Section 1 of
4 the Dwelling Unit Installment Contract Act.
5 (6) The board of the master association shall have
6 the authority to establish and maintain a system of
7 master metering of public utility services and to collect
8 payments in connection therewith, subject to the
9 requirements of the Tenant Utility Payment Disclosure
10 Act.
11 (7) The board of the master association or a common
12 interest community association shall have the power,
13 after notice and an opportunity to be heard, to levy and
14 collect reasonable fines from members for violations of
15 the declaration, bylaws, and rules and regulations of the
16 master association or the common interest community
17 association. Nothing contained in this subdivision (7)
18 shall give rise to a statutory lien for unpaid fines.
19 (d) Records.
20 (1) The board of the master association shall
21 maintain the following records of the association and
22 make them available for examination and copying at
23 convenient hours of weekdays by any unit owners in a
24 condominium subject to the authority of the board or
25 their mortgagees and their duly authorized agents or
26 attorneys:
27 (i) Copies of the recorded declaration, other
28 condominium instruments, other duly recorded
29 covenants and bylaws and any amendments, articles of
30 incorporation of the master association, annual
31 reports and any rules and regulations adopted by the
32 master association or its board shall be available.
33 Prior to the organization of the master association,
34 the developer shall maintain and make available the
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1 records set forth in this subdivision (d)(1) for
2 examination and copying.
3 (ii) Detailed and accurate records in
4 chronological order of the receipts and expenditures
5 affecting the common areas, specifying and itemizing
6 the maintenance and repair expenses of the common
7 areas and any other expenses incurred, and copies of
8 all contracts, leases, or other agreements entered
9 into by the master association, shall be maintained.
10 (iii) The minutes of all meetings of the
11 master association and the board of the master
12 association shall be maintained for not less than 7
13 years.
14 (iv) Ballots and proxies related thereto, if
15 any, for any election held for the board of the
16 master association and for any other matters voted
17 on by the unit owners shall be maintained for not
18 less than one year.
19 (v) Such other records of the master
20 association as are available for inspection by
21 members of a not-for-profit corporation pursuant to
22 Section 107.75 of the General Not For Profit
23 Corporation Act of 1986 shall be maintained.
24 (vi) With respect to units owned by a land
25 trust, if a trustee designates in writing a person
26 to cast votes on behalf of the unit owner, the
27 designation shall remain in effect until a
28 subsequent document is filed with the association.
29 (2) Where a request for records under this
30 subsection is made in writing to the board of managers or
31 its agent, failure to provide the requested record or to
32 respond within 30 days shall be deemed a denial by the
33 board of directors.
34 (3) A reasonable fee may be charged by the master
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1 association or its board for the cost of copying.
2 (4) If the board of directors fails to provide
3 records properly requested under subdivision (d)(1)
4 within the time period provided in subdivision (d)(2),
5 the unit owner may seek appropriate relief, including an
6 award of attorney's fees and costs.
7 (e) The board of directors shall have standing and
8 capacity to act in a representative capacity in relation to
9 matters involving the common areas of the master association
10 or more than one unit, on behalf of the unit owners as their
11 interests may appear.
12 (f) Administration of property prior to election of the
13 initial board of directors.
14 (1) Until the election, by the unit owners or the
15 boards of managers of the underlying condominium
16 associations, of the initial board of directors of a
17 master association whose declaration is recorded on or
18 after August 10, 1990, the same rights, titles, powers,
19 privileges, trusts, duties and obligations that are
20 vested in or imposed upon the board of directors by this
21 Act or in the declaration or other duly recorded covenant
22 shall be held and performed by the developer.
23 (2) The election of the initial board of directors
24 of a master association whose declaration is recorded on
25 or after August 10, 1990, by the unit owners or the
26 boards of managers of the underlying condominium
27 associations, shall be held not later than 60 days after
28 the conveyance by the developer of 75% of the units, or 3
29 years after the recording of the declaration, whichever
30 is earlier. The developer shall give at least 21 days
31 notice of the meeting to elect the initial board of
32 directors and shall upon request provide to any unit
33 owner, within 3 working days of the request, the names,
34 addresses, and weighted vote of each unit owner entitled
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1 to vote at the meeting. Any unit owner shall upon
2 receipt of the request be provided with the same
3 information, within 10 days of the request, with respect
4 to each subsequent meeting to elect members of the board
5 of directors.
6 (3) If the initial board of directors of a master
7 association whose declaration is recorded on or after
8 August 10, 1990 is not elected by the unit owners or the
9 members of the underlying condominium association board
10 of managers at the time established in subdivision
11 (f)(2), the developer shall continue in office for a
12 period of 30 days, whereupon written notice of his
13 resignation shall be sent to all of the unit owners or
14 members of the underlying condominium board of managers
15 entitled to vote at an election for members of the board
16 of directors.
17 (4) Within 60 days following the election of a
18 majority of the board of directors, other than the
19 developer, by unit owners, the developer shall deliver to
20 the board of directors:
21 (i) All original documents as recorded or
22 filed pertaining to the property, its
23 administration, and the association, such as the
24 declaration, articles of incorporation, other
25 instruments, annual reports, minutes, rules and
26 regulations, and contracts, leases, or other
27 agreements entered into by the association. If any
28 original documents are unavailable, a copy may be
29 provided if certified by affidavit of the developer,
30 or an officer or agent of the developer, as being a
31 complete copy of the actual document recorded or
32 filed.
33 (ii) A detailed accounting by the developer,
34 setting forth the source and nature of receipts and
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1 expenditures in connection with the management,
2 maintenance and operation of the property, copies of
3 all insurance policies, and a list of any loans or
4 advances to the association which are outstanding.
5 (iii) Association funds, which shall have been
6 at all times segregated from any other moneys of the
7 developer.
8 (iv) A schedule of all real or personal
9 property, equipment and fixtures belonging to the
10 association, including documents transferring the
11 property, warranties, if any, for all real and
12 personal property and equipment, deeds, title
13 insurance policies, and all tax bills.
14 (v) A list of all litigation, administrative
15 action and arbitrations involving the association,
16 any notices of governmental bodies involving actions
17 taken or which may be taken concerning the
18 association, engineering and architectural drawings
19 and specifications as approved by any governmental
20 authority, all other documents filed with any other
21 governmental authority, all governmental
22 certificates, correspondence involving enforcement
23 of any association requirements, copies of any
24 documents relating to disputes involving unit
25 owners, and originals of all documents relating to
26 everything listed in this subparagraph.
27 (5) With respect to any master association whose
28 declaration is recorded on or after August 10, 1990, any
29 contract, lease, or other agreement made prior to the
30 election of a majority of the board of directors other
31 than the developer by or on behalf of unit owners or
32 underlying condominium associations, the association or
33 the board of directors, which extends for a period of
34 more than 2 years from the recording of the declaration,
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1 shall be subject to cancellation by more than 1/2 of the
2 votes of the unit owners, other than the developer, cast
3 at a special meeting of members called for that purpose
4 during a period of 90 days prior to the expiration of the
5 2 year period if the board of managers is elected by the
6 unit owners, otherwise by more than 1/2 of the underlying
7 condominium board of managers. At least 60 days prior to
8 the expiration of the 2 year period, the board of
9 directors, or, if the board is still under developer
10 control, then the board of managers or the developer
11 shall send notice to every unit owner or underlying
12 condominium board of managers, notifying them of this
13 provision, of what contracts, leases and other agreements
14 are affected, and of the procedure for calling a meeting
15 of the unit owners or for action by the underlying
16 condominium board of managers for the purpose of acting
17 to terminate such contracts, leases or other agreements.
18 During the 90 day period the other party to the contract,
19 lease, or other agreement shall also have the right of
20 cancellation.
21 (6) The statute of limitations for any actions in
22 law or equity which the master association may bring
23 shall not begin to run until the unit owners or
24 underlying condominium board of managers have elected a
25 majority of the members of the board of directors.
26 (g) In the event of any resale of a unit in a master
27 association by a unit owner other than the developer, the
28 owner shall obtain from the board of directors and shall make
29 available for inspection to the prospective purchaser, upon
30 demand, the following:
31 (1) A copy of the declaration, other instruments
32 and any rules and regulations.
33 (2) A statement of any liens, including a statement
34 of the account of the unit setting forth the amounts of
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1 unpaid assessments and other charges due and owing.
2 (3) A statement of any capital expenditures
3 anticipated by the association within the current or
4 succeeding 2 fiscal years.
5 (4) A statement of the status and amount of any
6 reserve for replacement fund and any portion of such fund
7 earmarked for any specified project by the board of
8 directors.
9 (5) A copy of the statement of financial condition
10 of the association for the last fiscal year for which
11 such a statement is available.
12 (6) A statement of the status of any pending suits
13 or judgments in which the association is a party.
14 (7) A statement setting forth what insurance
15 coverage is provided for all unit owners by the
16 association.
17 (8) A statement that any improvements or
18 alterations made to the unit, or any part of the common
19 areas assigned thereto, by the prior unit owner are in
20 good faith believed to be in compliance with the
21 declaration of the master association.
22 The principal officer of the unit owner's association or
23 such other officer as is specifically designated shall
24 furnish the above information when requested to do so in
25 writing, within 30 days of receiving the request.
26 A reasonable fee covering the direct out-of-pocket cost
27 of copying and providing such information may be charged by
28 the association or its board of directors to the unit seller
29 for providing the information.
30 (h) Errors and omissions.
31 (1) If there is an omission or error in the
32 declaration or other instrument of the master
33 association, the master association may correct the error
34 or omission by an amendment to the declaration or other
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1 instrument, as may be required to conform it to this Act,
2 to any other applicable statute, or to the declaration.
3 The amendment shall be adopted by vote of two-thirds of
4 the members of the board of directors or by a majority
5 vote of the unit owners at a meeting called for that
6 purpose, unless the Act or the declaration of the master
7 association specifically provides for greater percentages
8 or different procedures.
9 (2) If, through a scrivener's error, a unit has not
10 been designated as owning an appropriate undivided share
11 of the common areas or does not bear an appropriate share
12 of the common expenses, or if all of the common expenses
13 or all of the common elements in the condominium have not
14 been distributed in the declaration, so that the sum
15 total of the shares of common areas which have been
16 distributed or the sum total of the shares of the common
17 expenses fail to equal 100%, or if it appears that more
18 than 100% of the common elements or common expenses have
19 been distributed, the error may be corrected by operation
20 of law by filing an amendment to the declaration,
21 approved by vote of two-thirds of the members of the
22 board of directors or a majority vote of the unit owners
23 at a meeting called for that purpose, which
24 proportionately adjusts all percentage interests so that
25 the total is equal to 100%, unless the declaration
26 specifically provides for a different procedure or
27 different percentage vote by the owners of the units and
28 the owners of mortgages thereon affected by modification
29 being made in the undivided interest in the common areas,
30 the number of votes in the unit owners association or the
31 liability for common expenses appertaining to the unit.
32 (3) If an omission or error or a scrivener's error
33 in the declaration or other instrument is corrected by
34 vote of two-thirds of the members of the board of
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1 directors pursuant to the authority established in
2 subdivisions (h)(1) or (h)(2) of this Section, the board,
3 upon written petition by unit owners with 20% of the
4 votes of the association or resolutions adopted by the
5 board of managers or board of directors of the
6 condominium and common interest community associations
7 which select 20% of the members of the board of directors
8 of the master association, whichever is applicable,
9 received within 30 days of the board action, shall call a
10 meeting of the unit owners or the boards of the
11 condominium and common interest community associations
12 which select members of the board of directors of the
13 master association within 30 days of the filing of the
14 petition or receipt of the condominium and common
15 interest community association resolution to consider the
16 board action. Unless a majority of the votes of the unit
17 owners of the association are cast at the meeting to
18 reject the action, or board of managers or board of
19 directors of condominium and common interest community
20 associations which select over 50% of the members of the
21 board of the master association adopt resolutions prior
22 to the meeting rejecting the action of the board of
23 directors of the master association, it is ratified
24 whether or not a quorum is present.
25 (4) The procedures for amendments set forth in this
26 subsection (h) cannot be used if such an amendment would
27 materially or adversely affect property rights of the
28 unit owners unless the affected unit owners consent in
29 writing. This Section does not restrict the powers of
30 the association to otherwise amend the declaration,
31 bylaws, or other condominium instruments, but authorizes
32 a simple process of amendment requiring a lesser vote for
33 the purpose of correcting defects, errors, or omissions
34 when the property rights of the unit owners are not
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1 materially or adversely affected.
2 (5) If there is an omission or error in the
3 declaration or other instruments that may not be
4 corrected by an amendment procedure set forth in
5 subdivision (h)(1) or (h)(2) of this Section, then the
6 circuit court in the county in which the master
7 association is located shall have jurisdiction to hear a
8 petition of one or more of the unit owners thereon or of
9 the association, to correct the error or omission, and
10 the action may be a class action. The court may require
11 that one or more methods of correcting the error or
12 omission be submitted to the unit owners to determine the
13 most acceptable correction. All unit owners in the
14 association must be joined as parties to the action.
15 Service of process on owners may be by publication, but
16 the plaintiff shall furnish all unit owners not
17 personally served with process with copies of the
18 petition and final judgment of the court by certified
19 mail, return receipt requested, at their last known
20 address.
21 (6) Nothing contained in this Section shall be
22 construed to invalidate any provision of a declaration
23 authorizing the developer to amend an instrument prior to
24 the latest date on which the initial membership meeting
25 of the unit owners must be held, whether or not it has
26 actually been held, to bring the instrument into
27 compliance with the legal requirements of the Federal
28 National Mortgage Association, the Federal Home Loan
29 Mortgage Corporation, the Federal Housing Administration,
30 the United States Veterans Administration or their
31 respective successors and assigns.
32 (i) The provisions of subsections (c) through (h) are
33 applicable to all declarations, other condominium
34 instruments, and other duly recorded covenants establishing
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1 the powers and duties of the master association recorded
2 under this Act. Any portion of a declaration, other
3 condominium instrument, or other duly recorded covenant
4 establishing the powers and duties of a master association
5 which contains provisions contrary to the provisions of
6 subsection (c) through (h) shall be void as against public
7 policy and ineffective. Any declaration, other condominium
8 instrument, or other duly recorded covenant establishing the
9 powers and duties of the master association which fails to
10 contain the provisions required by subsections (c) through
11 (h) shall be deemed to incorporate such provisions by
12 operation of law.
13 (j) The provisions of subsections (c) through (h) are
14 applicable to all common interest community associations and
15 their unit owners for common interest community associations
16 which are subject to the provisions of Section 9-102(a)(8) of
17 the Code of Civil Procedure. For purposes of this
18 subsection, the terms "common interest community" and "unit
19 owners" shall have the same meaning as set forth in Section
20 9-102(c) of the Code of Civil Procedure.
21 (Source: P.A. 89-41, eff. 6-23-95.)
22 Section 99. Effective date. This Act takes effect upon
23 becoming law.