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90_SB1618
815 ILCS 307/10-25
815 ILCS 307/10-115
Amends the Illinois Business Brokers Act of 1995. In
provisions authorizing the imposition of liens on the
proceeds of a sale of a business for amounts due a business
broker, provides that no claim for lien shall attach to any
real property asset of a business until the claim for lien is
filed with the recorder of the county in which the real
property asset is located. Provides that the Secretary of
State shall not impose a fee on a business broker for filing
a notice of lien with the recorder on a real property
business asset. In provisions requiring a plaintiff suing to
enforce a business broker lien to name as defendants all
persons whom the plaintiff has knowledge are interested
parties, provides that the knowledge be actual or
constructive knowledge. Effective immediately.
LRB9010682SMdv
LRB9010682SMdv
1 AN ACT to amend the Illinois Business Brokers Act of 1995
2 by changing Sections 10-25 and 10-115.
3 Be it enacted by the People of the State of Illinois,
4 represented in the General Assembly:
5 Section 5. The Illinois Business Brokers Act of 1995 is
6 amended by changing Sections 10-25 and 10-115 as follows:
7 (815 ILCS 307/10-25)
8 Sec. 10-25. Fees and funds. All fees and funds accruing
9 for the administration of this Act shall be accounted for by
10 the Secretary of State and shall be deposited with the State
11 Treasurer who shall deposit them in the Securities Audit and
12 Enforcement Fund.
13 (a) The Secretary of State shall, by rule or regulation,
14 impose and collect fees necessary for the administration of
15 this Act, including but not limited to, fees for the
16 following purposes:
17 (1) Filing an application pursuant to Section 10-10
18 of this Act;
19 (2) Examining an application pursuant to Sections
20 10-10 and 10-20 of this Act;
21 (3) Registering a business broker under Section
22 10-10 of this Act;
23 (4) Renewing registration of a business broker
24 pursuant to Section 10-20 of this Act;
25 (5) Failure to file or file timely any document or
26 information required under this Act;
27 (6) Filing a notice of lien pursuant to Section
28 10-115 of this Act, except notice of a lien filed with
29 the recorder of the county pursuant to subsection (p) of
30 Section 10-115.
31 (b) The Secretary of State may, by rule or regulation,
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1 raise or lower any fee imposed by, and which he or she is
2 authorized by law to collect under, this Act.
3 (Source: P.A. 89-209, eff. 1-1-96; 90-70, eff. 7-8-97.)
4 (815 ILCS 307/10-115)
5 Sec. 10-115. Business broker lien.
6 (a) Any business broker shall have a lien upon the
7 assets of a business that is the subject of a business
8 broker's contract and the proceeds from the sale of such
9 business in the amount that the broker is due.
10 (b) The lien shall be available to the business broker
11 named in the instrument signed by the seller or purchaser.
12 The lien arising under this Act shall be in addition to any
13 other rights that a business broker may have.
14 (c) The lien under this Act shall attach upon the
15 business broker being otherwise entitled to a fee or
16 commission under a written instrument signed by the seller or
17 purchaser or the seller or purchaser's duly authorized agent,
18 as applicable.
19 (d) When payment to a business broker is due in
20 installments, a portion of which is due only after the
21 conveyance or transfer of the business, any claim for lien
22 for those payments due after the transfer or conveyance may
23 be filed at any time subsequent to the transfer or conveyance
24 of the business and prior to the date on which the payment is
25 due but shall only be effective as a lien against the
26 business or proceeds to the extent moneys are still owed to
27 the transferor by the transferee. The lien shall attach as of
28 the filing of the notice of lien and not relate back to the
29 date of the written agreement.
30 (e) If a business broker has a written agreement with a
31 prospective purchaser or seller, then the lien shall attach
32 upon the prospective purchaser or seller that is purchasing,
33 selling, or otherwise accepting a conveyance or transfer of
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1 the business and the filing of a notice of lien by the
2 business broker in the Office of the Secretary of State
3 within 90 days after the purchase, sale, or other conveyance
4 or transfer of the business that is the subject of the
5 written agreement with the business broker. The lien shall
6 attach as of the date of the receipt of any consideration by
7 the seller of the business that is the subject of the written
8 agreement with the business broker.
9 (f) The business broker shall, within 10 days after
10 filing its notice of lien, mail a copy of the notice of lien
11 to the owner of the business by registered or certified mail,
12 with return receipt requested, or personally served on the
13 owner of record or his agent. If the lien is filed within 10
14 days prior to closing, the business broker is not required to
15 mail or personally serve a copy of the notice of lien.
16 Mailing of the copy of the notice of lien is effective if
17 mailed to the address of the business that is the subject of
18 the notice of lien, or to such other address as the seller or
19 purchaser has provided to the business broker in writing and
20 signed by the seller or purchaser. Mailing of the copy of
21 the notice of claim for lien is effective when deposited in a
22 United States mailbox with postage prepaid. The broker's
23 lien shall be unenforceable if mailing of the copy of the
24 notice of lien does not occur at the time and in the manner
25 required by this Act.
26 (g) A business broker may bring suit to enforce a lien
27 in the circuit court in the county where the headquarters of
28 the business being sold is located, where the purchaser
29 resides (or maintains its headquarters) if the lien is being
30 filed against the purchaser, or where the seller resides (or
31 maintains its headquarters) if the lien is filed against the
32 seller, by filing a complaint and sworn affidavit that the
33 lien has been filed.
34 (h) The person claiming a lien shall, within 2 years
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1 after filing the lien, commence proceedings by filing a
2 complaint. Failure to commence proceedings within 2 years
3 after filing the lien shall extinguish the lien. No
4 subsequent notice of lien may be given for the same claim nor
5 may that claim be asserted in any proceedings under this Act.
6 (i) A complaint under this Section shall contain a brief
7 statement of the contract or agreements on which the lien is
8 founded, the date when the contract or agreement was made, a
9 description of the services performed, the amount due and
10 unpaid, a description of the business that is, or the
11 proceeds from sale of which are, subject to the lien, and
12 other facts necessary for a full understanding of the rights
13 of the parties. The plaintiff shall make all interested
14 parties, of whose interest the plaintiff is notified or has
15 actual or constructive knowledge, defendants to the action
16 and shall issue summons and provide service as in other civil
17 actions. When any defendant resides or has gone out of the
18 State, or on inquiry cannot be found, or is concealed within
19 this State so that process cannot be served on that
20 defendant, the plaintiff shall cause a notice to be given to
21 that defendant, or cause a copy of the complaint to be served
22 upon that defendant, in the manner and upon the same
23 conditions as in other civil actions. Failure of the
24 plaintiff to provide proper summons or notice shall be
25 grounds for judgment against the plaintiff with prejudice.
26 (j) The lien notice shall state the name of the
27 claimant, the name of the purchaser or seller whose property
28 or assets are subject to the lien, a description of the
29 business upon which or upon the proceeds from the sale of
30 which the lien is being claimed, the amount for which the
31 lien is claimed, and the registration number of the business
32 broker. The notice of lien shall recite that the information
33 contained in the notice is true and accurate to the knowledge
34 of the signatory. The notice of lien shall be signed by the
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1 business broker or by a person authorized to sign on behalf
2 of the business broker and shall be verified.
3 (k) Whenever a claim for lien has been filed with the
4 Office of the Secretary of State and a condition occurs that
5 would preclude the business broker from receiving
6 compensation under the terms of the business broker's written
7 agreement, the business broker shall provide to the purchaser
8 of the business, if the lien is filed against the purchaser,
9 or the seller of the business, if the lien is filed against
10 the seller, within 10 days following demand by the owner of
11 record, a written release or satisfaction of the lien.
12 (l) Upon written demand of the owner, lienee, or other
13 authorized agent, served on the person claiming the lien
14 requiring suit to be commenced to enforce the lien or answer
15 to be filed in a pending suit, a suit shall be commenced or
16 answer filed within 30 days thereafter, or the lien shall be
17 extinguished. Service may be by registered or certified
18 mail, return receipt requested, or by personal service.
19 (m) If a claim for lien has been filed with the
20 Secretary of State and is paid, or if there is failure to
21 institute a suit to enforce the lien within the time provided
22 by this Act, the business broker shall acknowledge
23 satisfaction or release of the lien, in writing, on written
24 demand of the purchaser of the business, if the lien is filed
25 against the purchaser, or the seller of the business, if the
26 lien is filed against the seller, within 5 days after payment
27 or expiration of the time in which to file the lien.
28 (n) The cost of proceedings asserting or defending a
29 business broker's claim of lien, including reasonable
30 attorneys' fees, costs, and prejudgment interests due to the
31 prevailing party, shall be borne by the nonprevailing party
32 or parties. When more than one party is responsible for
33 costs, fees, and prejudgment interest, the costs, fees, and
34 prejudgment interest shall be equitably apportioned by the
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1 court among those responsible parties.
2 (o) Prior recorded liens and mortgages shall have
3 priority over a broker's lien. A prior recorded lien shall
4 include, without limitation, (i) a valid mechanic's lien
5 claim that is recorded subsequent to the broker's notice of
6 lien but which relates back to a date prior to the recording
7 date of the broker's notice of lien and (ii) prior recorded
8 liens securing revolving credit and future advances of
9 construction loans as described in Section 15-1302 of the
10 Code of Civil Procedure.
11 (p) No claim for lien shall attach to any real property
12 asset of a business unless and until a claim for lien is
13 filed with the recorder of the county in which the real
14 property asset is located. A lien recorded under this
15 subsection (p) shall otherwise be subject to the same notice,
16 enforcement, and limitations as any other lien under this
17 Section.
18 (Source: P.A. 90-70, eff. 7-8-97.)
19 Section 99. Effective date. This Act takes effect upon
20 becoming law.