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91_SB0749eng
SB749 Engrossed LRB9103048DJcd
1 AN ACT to amend the Illinois Business Brokers Act of 1995
2 by changing Sections 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 10-105 and 10-115 as follows:
7 (815 ILCS 307/10-105)
8 Sec. 10-105. Scope of the Act. This Act shall apply
9 only when the person engaging or seeking to engage engaged or
10 sought to be engaged by the business broker is domiciled in
11 this State or when the company or business sought to be sold
12 has its principal place of business in this State.
13 Notwithstanding any other provision of this Section, a lien
14 on property arising under Section 10-115 is enforceable only
15 against tangible property located in this State.
16 (Source: P.A. 90-70, eff. 7-8-97.)
17 (815 ILCS 307/10-115)
18 Sec. 10-115. Business broker lien.
19 (a) Any business broker shall have a lien upon the
20 tangible assets of a business located in this State that is
21 the subject of a business broker's written contract and the
22 proceeds from the sale of such business in the amount due to
23 that the broker under the written contract is due.
24 (b) The lien shall be available to the business broker
25 named in the instrument signed by the owner of an interest in
26 the assets seller or purchaser. The lien arising under this
27 Act shall be in addition to any other rights that a business
28 broker may have.
29 (c) The lien under this Act shall attach upon the
30 business broker being otherwise entitled to a fee or
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1 commission under a written contract instrument signed by the
2 seller or its purchaser or the seller or purchaser's duly
3 authorized agent, as applicable, if, before the actual
4 conveyance or transfer of the business assets or property
5 with respect to which the business broker is claiming a
6 lien, the business broker files a notice of lien (i) in the
7 recorder's office of the county in which the real property is
8 located, as to real property, and (ii) in the Office of the
9 Secretary of State, as to tangible personal property.
10 (d) When payment to a business broker is due in
11 installments, a portion of which is due only after the
12 conveyance or transfer of the tangible assets business, any
13 claim for lien for those payments due after the transfer or
14 conveyance may be filed at any time subsequent to the
15 transfer or conveyance of the tangible assets business and
16 prior to the date on which the payment is due but shall only
17 be effective as a lien against the tangible assets business
18 or proceeds to the extent moneys are still owed to the
19 transferor by the transferee. The lien shall attach as of the
20 filing of the notice of lien and not relate back to the date
21 of the written agreement.
22 (e) If a business broker has a written agreement with a
23 prospective purchaser or seller, then the lien shall attach
24 upon the prospective purchaser or seller that is purchasing,
25 selling, or otherwise accepting a conveyance or transfer of
26 the real property or tangible personal property of the
27 business and the filing of a notice of lien (i) in the
28 recorder's office of the county in which the real property is
29 located, as to real property, and (ii) in the Office of the
30 Secretary of State, as to tangible personal property, by the
31 business broker in the Office of the Secretary of State
32 within 90 days after the transfer to the purchaser purchase,
33 sale, or other conveyance or transfer of the business that is
34 the subject of the written agreement with the business broker
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1 receipt of any consideration by the seller of the business
5 that is the subject of the written agreement with the
6 business broker.
7 (f) The business broker shall, within 10 days after
8 filing its notice of lien, mail a copy of the notice of lien
9 to the owner of the property business by depositing it in the
10 United States mail, registered or certified mail, with return
11 receipt requested, or personally serve a copy of the notice
12 served on the owner of record or his agent. If the lien is
13 filed within 10 days prior to closing, the business broker is
14 not required to mail or personally serve a copy of the notice
15 of lien. Mailing of the copy of the notice of lien is
16 effective if mailed to the address of the business that is
17 the subject of the notice of lien, or to such other address
18 as the seller or purchaser has provided to the business
19 broker in writing and signed by the seller or purchaser.
20 Mailing of the copy of the notice of claim for lien is
21 effective if mailed to the seller at the address of the
22 business that is the subject of the notice of lien or to
23 another address that the seller or purchaser has provided in
24 writing to the business broker when deposited in a United
25 States mailbox with postage prepaid. The broker's lien shall
26 be unenforceable if mailing of the copy of the notice of lien
27 does not occur at the time and in the manner required by this
28 Act.
29 (g) A business broker may bring suit to enforce a lien
30 in the circuit court (i) in the county where the real
31 property headquarters of the business being sold is located,
32 as to real property, or (ii) as to tangible personal
33 property, either in the county where the personal property
34 is located or where the principal office of the owner of the
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1 personal property, or the owner's residence, is located
2 where the purchaser resides (or maintains its headquarters)
3 if the lien is being filed against the purchaser, or where
4 the seller resides (or maintains its headquarters) if the
5 lien is filed against the seller, by filing a complaint and
6 sworn affidavit that the lien has been filed.
7 (h) The person claiming a lien shall, within 2 years
8 after filing the lien, commence proceedings by filing a
9 complaint. Failure to commence proceedings within 2 years
10 after filing the lien shall extinguish the lien. No
11 subsequent notice of lien may be given for the same claim nor
12 may that claim be asserted in any proceedings under this Act.
13 (i) A complaint under this Section shall have attached
14 to it a copy contain a brief statement of the written
15 contract or agreements on which the lien is founded and shall
16 contain, the date when the contract or agreement was made, a
17 description of the services performed, the amount due and
18 unpaid, a description of the tangible assets of the business
19 that is, or the proceeds from sale of which are, subject to
20 the lien, and other facts necessary for a full understanding
21 of the rights of the parties. The plaintiff shall make all
22 interested parties, of whose interest the plaintiff is
23 notified or has knowledge, defendants to the action and shall
24 issue summons and provide service as in other civil actions.
25 When any defendant resides or has gone out of the State, or
26 on inquiry cannot be found, or is concealed within this State
27 so that process cannot be served on that defendant, the
28 plaintiff shall cause a notice to be given to that defendant,
29 or cause a copy of the complaint to be served upon that
30 defendant, in the manner and upon the same conditions as in
31 other civil actions. Failure of the plaintiff to provide
32 proper summons or notice shall be grounds for judgment
33 against the plaintiff with prejudice. Every lien claimed
34 under this Act shall be foreclosed as provided in the
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1 Illinois Mortgage Foreclosure Law, if the lien is on real
2 property, or as provided in the Uniform Commercial Code, if
3 the lien is on personal property.
4 (j) The lien notice shall state the name and address of
5 the claimant, the name of the purchaser or seller whose
6 property or assets are subject to the lien, a description of
7 the real or personal property that is subject to the lien
8 business upon which or upon the proceeds from the sale of
9 which the lien is being claimed, the amount for which the
10 lien is claimed, and the registration number of the business
11 broker. The notice of lien shall recite that the information
12 contained in the notice is true and accurate to the knowledge
13 of the signer signatory. The notice of lien shall be signed
14 by the business broker or by a person authorized to sign on
15 behalf of the business broker and shall be verified.
16 (k) Whenever a claim for lien has been filed with the
17 Office of the Secretary of State or the county recorder's
18 office and a condition occurs that would preclude the
19 business broker from receiving compensation under the terms
20 of the business broker's written agreement, the business
21 broker shall provide to the purchaser of the business, if the
22 lien is filed against the purchaser's assets of the business
23 that are subject to this Act purchaser, or the seller of the
24 business, if the lien is filed against the seller's assets of
25 the business that are subject to this Act seller, within 10
26 days following demand by that party the owner of record, a
27 written release or satisfaction of the lien.
28 (l) Upon written demand of the owner, lienee, or other
29 authorized agent, served on the person claiming the lien
30 requiring suit to be commenced to enforce the lien or answer
31 to be filed in a pending suit, a suit shall be commenced or
32 answer filed within 30 days thereafter, or the lien shall be
33 extinguished. Service may be by registered or certified
34 mail, return receipt requested, or by personal service.
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1 (m) If a claim for lien has been filed with the Office
2 of the Secretary of State or the county recorder's office and
3 is paid, or if there is failure to institute a suit to
4 enforce the lien within the time provided by this Act, the
5 business broker shall acknowledge satisfaction or release of
6 the lien, in writing, on written demand of the purchaser of
7 the business, if the lien is filed against the purchaser, or
8 the seller of the business, if the lien is filed against the
9 seller, within 5 days after payment or expiration of the time
10 in which to file the lien.
11 (n) The cost of proceedings brought under this Act
12 asserting or defending a business broker's claim of lien,
13 including reasonable attorneys' fees, costs, and prejudgment
14 interest interests due to the prevailing party, shall be
15 borne by the nonprevailing party or parties. When more than
16 one party is responsible for costs, fees, and prejudgment
17 interest, the costs, fees, and prejudgment interest shall be
18 equitably apportioned by the court among those responsible
19 parties.
20 (o) Prior recorded liens and mortgages shall have
21 priority over a broker's lien. A prior recorded lien shall
22 include, without limitation, (i) a valid mechanic's lien
23 claim, that is recorded subsequent to the broker's notice of
24 lien but which relates back to a date prior to the recording
25 date of the broker's notice of lien and (ii) prior recorded
26 liens securing revolving credit or and future advances under
27 of construction loans as described in Section 15-1302 of the
28 Code of Civil Procedure, and (iii) prior recorded liens
29 perfected under the Uniform Commercial Code.
30 (Source: P.A. 90-70, eff. 7-8-97.)
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