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Public Act 91-0194
SB249 Enrolled LRB9101619SMdvA
AN ACT to amend the Illinois Business Brokers Act of 1995
by changing Sections 10-25 and 10-115.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Illinois Business Brokers Act of 1995 is
amended by changing Sections 10-25 and 10-115 as follows:
(815 ILCS 307/10-25)
Sec. 10-25. Fees and funds. All fees and funds accruing
for the administration of this Act shall be accounted for by
the Secretary of State and shall be deposited with the State
Treasurer who shall deposit them in the Securities Audit and
Enforcement Fund.
(a) The Secretary of State shall, by rule or regulation,
impose and collect fees necessary for the administration of
this Act, including but not limited to, fees for the
following purposes:
(1) Filing an application pursuant to Section 10-10
of this Act;
(2) Examining an application pursuant to Sections
10-10 and 10-20 of this Act;
(3) Registering a business broker under Section
10-10 of this Act;
(4) Renewing registration of a business broker
pursuant to Section 10-20 of this Act;
(5) Failure to file or file timely any document or
information required under this Act;
(6) Filing a notice of lien with the Secretary of
State pursuant to Section 10-115 of this Act.
(b) The Secretary of State may, by rule or regulation,
raise or lower any fee imposed by, and which he or she is
authorized by law to collect under, this Act.
(Source: P.A. 89-209, eff. 1-1-96; 90-70, eff. 7-8-97.)
(815 ILCS 307/10-115)
Sec. 10-115. Business broker lien.
(a) Any business broker shall have a lien upon the
assets of a business that is the subject of a business
broker's contract and the proceeds from the sale of such
business in the amount that the broker is due.
(b) The lien shall be available to the business broker
named in the instrument signed by the seller or purchaser.
The lien arising under this Act shall be in addition to any
other rights that a business broker may have.
(c) The lien under this Act shall attach upon the
business broker being otherwise entitled to a fee or
commission under a written instrument signed by the seller or
purchaser or the seller or purchaser's duly authorized agent,
as applicable.
(d) When payment to a business broker is due in
installments, a portion of which is due only after the
conveyance or transfer of the business, any claim for lien
for those payments due after the transfer or conveyance may
be filed at any time subsequent to the transfer or conveyance
of the business and prior to the date on which the payment is
due but shall only be effective as a lien against the
business or proceeds to the extent moneys are still owed to
the transferor by the transferee. The lien shall attach as of
the filing of the notice of lien and not relate back to the
date of the written agreement.
(e) If a business broker has a written agreement with a
prospective purchaser or seller, then the lien shall attach
upon the prospective purchaser or seller that is purchasing,
selling, or otherwise accepting a conveyance or transfer of
the business and the filing of a notice of lien by the
business broker in the Office of the Secretary of State
within 90 days after the purchase, sale, or other conveyance
or transfer of the business that is the subject of the
written agreement with the business broker. The lien shall
attach as of the date of the receipt of any consideration by
the seller of the business that is the subject of the written
agreement with the business broker.
(f) The business broker shall, within 10 days after
filing its notice of lien, mail a copy of the notice of lien
to the owner of the business by registered or certified mail,
with return receipt requested, or personally served on the
owner of record or his agent. If the lien is filed within 10
days prior to closing, the business broker is not required to
mail or personally serve a copy of the notice of lien.
Mailing of the copy of the notice of lien is effective if
mailed to the address of the business that is the subject of
the notice of lien, or to such other address as the seller or
purchaser has provided to the business broker in writing and
signed by the seller or purchaser. Mailing of the copy of
the notice of claim for lien is effective when deposited in a
United States mailbox with postage prepaid. The broker's
lien shall be unenforceable if mailing of the copy of the
notice of lien does not occur at the time and in the manner
required by this Act.
(g) A business broker may bring suit to enforce a lien
in the circuit court in the county where the headquarters of
the business being sold is located, where the purchaser
resides (or maintains its headquarters) if the lien is being
filed against the purchaser, or where the seller resides (or
maintains its headquarters) if the lien is filed against the
seller, by filing a complaint and sworn affidavit that the
lien has been filed.
(h) The person claiming a lien shall, within 2 years
after filing the lien, commence proceedings by filing a
complaint. Failure to commence proceedings within 2 years
after filing the lien shall extinguish the lien. No
subsequent notice of lien may be given for the same claim nor
may that claim be asserted in any proceedings under this Act.
(i) A complaint under this Section shall contain a brief
statement of the contract or agreements on which the lien is
founded, the date when the contract or agreement was made, a
description of the services performed, the amount due and
unpaid, a description of the business that is, or the
proceeds from sale of which are, subject to the lien, and
other facts necessary for a full understanding of the rights
of the parties. The plaintiff shall make all interested
parties, of whose interest the plaintiff is notified or has
actual or constructive knowledge, defendants to the action
and shall issue summons and provide service as in other civil
actions. When any defendant resides or has gone out of the
State, or on inquiry cannot be found, or is concealed within
this State so that process cannot be served on that
defendant, the plaintiff shall cause a notice to be given to
that defendant, or cause a copy of the complaint to be served
upon that defendant, in the manner and upon the same
conditions as in other civil actions. Failure of the
plaintiff to provide proper summons or notice shall be
grounds for judgment against the plaintiff with prejudice.
(j) The lien notice shall state the name of the
claimant, the name of the purchaser or seller whose property
or assets are subject to the lien, a description of the
business upon which or upon the proceeds from the sale of
which the lien is being claimed, the amount for which the
lien is claimed, and the registration number of the business
broker. The notice of lien shall recite that the information
contained in the notice is true and accurate to the knowledge
of the signatory. The notice of lien shall be signed by the
business broker or by a person authorized to sign on behalf
of the business broker and shall be verified.
(k) Whenever a claim for lien has been filed with the
Office of the Secretary of State and a condition occurs that
would preclude the business broker from receiving
compensation under the terms of the business broker's written
agreement, the business broker shall provide to the purchaser
of the business, if the lien is filed against the purchaser,
or the seller of the business, if the lien is filed against
the seller, within 10 days following demand by the owner of
record, a written release or satisfaction of the lien.
(l) Upon written demand of the owner, lienee, or other
authorized agent, served on the person claiming the lien
requiring suit to be commenced to enforce the lien or answer
to be filed in a pending suit, a suit shall be commenced or
answer filed within 30 days thereafter, or the lien shall be
extinguished. Service may be by registered or certified
mail, return receipt requested, or by personal service.
(m) If a claim for lien has been filed with the
Secretary of State and is paid, or if there is failure to
institute a suit to enforce the lien within the time provided
by this Act, the business broker shall acknowledge
satisfaction or release of the lien, in writing, on written
demand of the purchaser of the business, if the lien is filed
against the purchaser, or the seller of the business, if the
lien is filed against the seller, within 5 days after payment
or expiration of the time in which to file the lien.
(n) The cost of proceedings asserting or defending a
business broker's claim of lien, including reasonable
attorneys' fees, costs, and prejudgment interests due to the
prevailing party, shall be borne by the nonprevailing party
or parties. When more than one party is responsible for
costs, fees, and prejudgment interest, the costs, fees, and
prejudgment interest shall be equitably apportioned by the
court among those responsible parties.
(o) Prior recorded liens and mortgages shall have
priority over a broker's lien. A prior recorded lien shall
include, without limitation, (i) a valid mechanic's lien
claim that is recorded subsequent to the broker's notice of
lien but which relates back to a date prior to the recording
date of the broker's notice of lien and (ii) prior recorded
liens securing revolving credit and future advances of
construction loans as described in Section 15-1302 of the
Code of Civil Procedure.
(p) No lien under this Section 10-115 shall attach to
any real property asset of a business unless and until a
notice of lien is filed with the recorder of the county in
which the real property asset is located. A lien recorded
under this subsection (p) shall otherwise be subject to the
same notice, enforcement, and limitations as any other lien
under this Section. A copy of the notice of lien recorded
under this subsection (p) shall be filed with the Secretary
of State.
(Source: P.A. 90-70, eff. 7-8-97.)
Section 99. Effective date. This Act takes effect upon
becoming law.
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