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91_SB0749enr
SB749 Enrolled LRB9103048DJcd
1 AN ACT to amend the Illinois Business Brokers Act of 1995
2 by changing Sections 10-25, 10-105, and 10-115.
3 Be it enacted by the People of the State of Illinois,
4 represented in the General Assembly:
5 Section 5. The Illinois Business Brokers Act of 1995 is
6 amended by changing Sections 10-25, 10-105, and 10-115 as
7 follows:
8 (815 ILCS 307/10-25)
9 Sec. 10-25. Fees and funds. All fees and funds accruing
10 for the administration of this Act shall be accounted for by
11 the Secretary of State and shall be deposited with the State
12 Treasurer who shall deposit them in the Securities Audit and
13 Enforcement Fund.
14 (a) The Secretary of State shall, by rule or regulation,
15 impose and collect fees necessary for the administration of
16 this Act, including but not limited to, fees for the
17 following purposes:
18 (1) Filing an application pursuant to Section 10-10
19 of this Act;
20 (2) Examining an application pursuant to Sections
21 10-10 and 10-20 of this Act;
22 (3) Registering a business broker under Section
23 10-10 of this Act;
24 (4) Renewing registration of a business broker
25 pursuant to Section 10-20 of this Act;
26 (5) Failure to file or file timely any document or
27 information required under this Act;
28 (6) Filing a notice of lien with the Secretary of
29 State pursuant to Section 10-115 of this Act.
30 (b) The Secretary of State may, by rule or regulation,
31 raise or lower any fee imposed by, and which he or she is
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1 authorized by law to collect under, this Act.
2 (Source: P.A. 89-209, eff. 1-1-96; 90-70, eff. 7-8-97.)
3 (815 ILCS 307/10-105)
4 Sec. 10-105. Scope of the Act. This Act shall apply
5 only when the person engaging or seeking to engage engaged or
6 sought to be engaged by the business broker is domiciled in
7 this State or when the company or business sought to be sold
8 has its principal place of business in this State.
9 Notwithstanding any other provision of this Section, a lien
10 on property arising under Section 10-115 is enforceable only
11 against tangible property located in this State.
12 (Source: P.A. 90-70, eff. 7-8-97.)
13 (815 ILCS 307/10-115)
14 Sec. 10-115. Business broker lien.
15 (a) Any business broker shall have a lien upon the
16 tangible assets of a business located in this State that is
17 the subject of a business broker's written contract and the
18 proceeds from the sale of such business in the amount due to
19 that the broker under the written contract is due.
20 (b) The lien shall be available to the business broker
21 named in the instrument signed by the owner of an interest in
22 the assets seller or purchaser. The lien arising under this
23 Act shall be in addition to any other rights that a business
24 broker may have.
25 (c) A The lien under this Act does not shall attach
26 unless and until: upon
27 (1) the business broker is being otherwise entitled
28 to a fee or commission under a written contract
29 instrument signed by the seller or its purchaser or the
30 seller or purchaser's duly authorized agent; and, as
31 applicable
32 (2) before the actual conveyance or transfer of the
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1 business assets or property with respect to which the
2 business broker is claiming a lien, the business broker
3 files a notice of lien (i) as to real property, with the
4 recorder of the county in which the real property is
5 located or (ii) as to tangible personal property, in the
6 Office of the Secretary of State.
7 (d) When payment to a business broker is due in
8 installments, a portion of which is due only after the
9 conveyance or transfer of the tangible assets business, any
10 claim for lien for those payments due after the transfer or
11 conveyance may be filed at any time subsequent to the
12 transfer or conveyance of the tangible assets business and
13 prior to the date on which the payment is due but shall only
14 be effective as a lien against the tangible assets business
15 or proceeds to the extent moneys are still owed to the
16 transferor by the transferee. In all other respects, the lien
17 shall attach as described in this subsection of the filing of
18 the notice of lien and not relate back to the date of the
19 written agreement.
20 (e) If a business broker has a written agreement with a
21 prospective purchaser or seller, then the lien shall attach
22 upon the prospective purchaser or seller that is purchasing,
23 selling, or otherwise accepting a conveyance or transfer of
24 the real property or tangible personal property of the
25 business and the filing of a notice of lien (i) in the
26 recorder's office of the county in which the real property is
27 located, as to real property, and (ii) in the Office of the
28 Secretary of State, as to tangible personal property, by the
29 business broker in the Office of the Secretary of State
30 within 90 days after the transfer to the purchaser purchase,
31 sale, or other conveyance or transfer of the business that is
32 the subject of the written agreement with the business broker
33 receipt of any consideration by the seller of the business
3 that is the subject of the written agreement with the
4 business broker.
5 (f) The business broker shall, within 10 days after
6 filing its notice of lien, mail a copy of the notice of lien
7 to the owner of the property business by depositing it in the
8 United States mail, registered or certified mail, with return
9 receipt requested, or personally serve a copy of the notice
10 served on the owner of record or his agent. If the lien is
11 filed within 10 days prior to closing, the business broker is
12 not required to mail or personally serve a copy of the notice
13 of lien. Mailing of the copy of the notice of lien is
14 effective if mailed to the address of the business that is
15 the subject of the notice of lien, or to such other address
16 as the seller or purchaser has provided to the business
17 broker in writing and signed by the seller or purchaser.
18 Mailing of the copy of the notice of claim for lien is
19 effective if mailed to the seller at the address of the
20 business that is the subject of the notice of lien or to
21 another address that the seller or purchaser has provided in
22 writing to the business broker when deposited in a United
23 States mailbox with postage prepaid. The broker's lien shall
24 be unenforceable if mailing of the copy of the notice of lien
25 does not occur at the time and in the manner required by this
26 Act.
27 (g) A business broker may bring suit to enforce a lien
28 in the circuit court (i) in the county where the real
29 property headquarters of the business being sold is located,
30 as to real property, or (ii) as to tangible personal
31 property, either in the county where the personal property
32 is located or where the principal office of the owner of the
33 personal property, or the owner's residence, is located
34 where the purchaser resides (or maintains its headquarters)
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1 if the lien is being filed against the purchaser, or where
2 the seller resides (or maintains its headquarters) if the
3 lien is filed against the seller, by filing a complaint and
4 sworn affidavit that the lien has been filed.
5 (h) The person claiming a lien shall, within 2 years
6 after filing the lien, commence proceedings by filing a
7 complaint. Failure to commence proceedings within 2 years
8 after filing the lien shall extinguish the lien. No
9 subsequent notice of lien may be given for the same claim nor
10 may that claim be asserted in any proceedings under this Act.
11 (i) A complaint under this Section shall have attached
12 to it a copy contain a brief statement of the written
13 contract or agreements on which the lien is founded and shall
14 contain, the date when the contract or agreement was made, a
15 description of the services performed, the amount due and
16 unpaid, a description of the tangible assets of the business
17 that is, or the proceeds from sale of which are, subject to
18 the lien, and other facts necessary for a full understanding
19 of the rights of the parties. The plaintiff shall make all
20 interested parties, of whose interest the plaintiff is
21 notified or has actual or constructive knowledge, defendants
22 to the action and shall issue summons and provide service as
23 in other civil actions. When any defendant resides or has
24 gone out of the State, or on inquiry cannot be found, or is
25 concealed within this State so that process cannot be served
26 on that defendant, the plaintiff shall cause a notice to be
27 given to that defendant, or cause a copy of the complaint to
28 be served upon that defendant, in the manner and upon the
29 same conditions as in other civil actions. Failure of the
30 plaintiff to provide proper summons or notice shall be
31 grounds for judgment against the plaintiff with prejudice.
32 Every lien claimed under this Act shall be foreclosed as
33 provided in the Illinois Mortgage Foreclosure Law, if the
34 lien is on real property, or as provided in the Uniform
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1 Commercial Code, if the lien is on personal property.
2 (j) The lien notice shall state the name and address of
3 the claimant, the name of the purchaser or seller whose
4 property or assets are subject to the lien, a description of
5 the real or personal property that is subject to the lien
6 business upon which or upon the proceeds from the sale of
7 which the lien is being claimed, the amount for which the
8 lien is claimed, and the registration number of the business
9 broker. The notice of lien shall recite that the information
10 contained in the notice is true and accurate to the knowledge
11 of the signer signatory. The notice of lien shall be signed
12 by the business broker or by a person authorized to sign on
13 behalf of the business broker and shall be verified.
14 (k) Whenever a claim for lien has been filed with the
15 Office of the Secretary of State or the county recorder's
16 office and a condition occurs that would preclude the
17 business broker from receiving compensation under the terms
18 of the business broker's written agreement, the business
19 broker shall provide to the purchaser of the business, if the
20 lien is filed against the purchaser's assets of the business
21 that are subject to this Act purchaser, or the seller of the
22 business, if the lien is filed against the seller's assets of
23 the business that are subject to this Act seller, within 10
24 days following demand by that party the owner of record, a
25 written release or satisfaction of the lien.
26 (l) Upon written demand of the owner, lienee, or other
27 authorized agent, served on the person claiming the lien
28 requiring suit to be commenced to enforce the lien or answer
29 to be filed in a pending suit, a suit shall be commenced or
30 answer filed within 30 days thereafter, or the lien shall be
31 extinguished. Service may be by registered or certified
32 mail, return receipt requested, or by personal service.
33 (m) If a claim for lien has been filed with the Office
34 of the Secretary of State or the county recorder's office and
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1 is paid, or if there is failure to institute a suit to
2 enforce the lien within the time provided by this Act, the
3 business broker shall acknowledge satisfaction or release of
4 the lien, in writing, on written demand of the purchaser of
5 the business, if the lien is filed against the purchaser, or
6 the seller of the business, if the lien is filed against the
7 seller, within 5 days after payment or expiration of the time
8 in which to file the lien.
9 (n) The cost of proceedings brought under this Act
10 asserting or defending a business broker's claim of lien,
11 including reasonable attorneys' fees, costs, and prejudgment
12 interest interests due to the prevailing party, shall be
13 borne by the nonprevailing party or parties. When more than
14 one party is responsible for costs, fees, and prejudgment
15 interest, the costs, fees, and prejudgment interest shall be
16 equitably apportioned by the court among those responsible
17 parties.
18 (o) Prior recorded liens and mortgages shall have
19 priority over a broker's lien. A prior recorded lien shall
20 include, without limitation, (i) a valid mechanic's lien
21 claim, that is recorded subsequent to the broker's notice of
22 lien but which relates back to a date prior to the recording
23 date of the broker's notice of lien and (ii) prior recorded
24 liens securing revolving credit or and future advances under
25 of construction loans as described in Section 15-1302 of the
26 Code of Civil Procedure, and (iii) prior recorded liens
27 perfected under the Uniform Commercial Code.
28 (Source: P.A. 90-70, eff. 7-8-97.)
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