95TH GENERAL ASSEMBLY
State of Illinois
2007 and 2008
SB2427


 
Introduced 2/15/2008, by Sen. John J. Cullerton
 
SYNOPSIS AS INTRODUCED:
 		














765 ILCS 605/18
  from Ch. 30, par. 318







    Amends the Condominium Property Act.  Provides that an association's bylaws restricting the use of the units may include other prohibitions on, or allowance of, smoking products.  Effective January 1, 2009.
















LRB095 15991 AJO 42004 b

















 


 


A BILL FOR









 











SB2427

LRB095 15991 AJO 42004 b






1
    AN ACT concerning civil law.

 
2
    Be it enacted by the People of the State of Illinois,
 
3
represented in the General Assembly:


 
4
    Section 5. The Condominium Property Act is amended  by 
5
changing Section 18 as follows:
 


6
    (765 ILCS 605/18)  (from Ch. 30, par. 318)



7
    (Text of Section after amendment by P.A. 95-624)

8
    Sec. 18. Contents of bylaws. The bylaws shall provide for 
9
at least
the following:


10
    (a) (1) The election from among the unit owners of a board 
11
    of managers,
the number of persons constituting such board, 
12
    and that the terms of at
least one-third of the members of 
13
    the board shall expire annually and that
all members of the 
14
    board shall be elected at large.
If there are multiple 
15
    owners of a single unit, only one of the multiple
owners 
16
    shall be eligible to serve as a member of the board at any 
17
    one time.


18
        (2) the powers and duties of the board;


19
        (3) the compensation, if any, of the members of the 
20
    board;


21
        (4) the method of removal from office of members of the 
22
    board;


23
        (5) that the board may engage the services of a manager 
 


 






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1
    or managing agent;


2
        (6) that each unit owner shall receive, at least 30 
3
    days prior to the
adoption thereof by the board of 
4
    managers, a copy of the proposed annual
budget together 
5
    with an indication of which portions are intended for

6
    reserves, capital expenditures or repairs or payment of 
7
    real estate taxes;


8
        (7) that the board of managers shall annually supply to

9
    all unit owners an itemized accounting of the common 
10
    expenses
for the preceding year actually incurred or paid, 
11
    together
with an indication of which portions were for 
12
    reserves, capital
expenditures or repairs or payment of 
13
    real estate taxes and
with a tabulation of the amounts 
14
    collected pursuant to the
budget or assessment, and showing 
15
    the net excess or
deficit of income over expenditures plus 
16
    reserves;


17
        (8) (i) that each unit owner shall receive notice, in 
18
    the same manner
as is provided in this Act for membership 
19
    meetings, of any meeting of the
board of managers 
20
    concerning the adoption of the proposed annual budget and

21
    regular assessments pursuant thereto or to adopt a separate 
22
    (special)
assessment, (ii) that except as provided in 
23
    subsection (iv) below, if an
adopted
budget or any separate 
24
    assessment adopted by the board would result in the
sum of 
25
    all regular and separate assessments payable in the current 
26
    fiscal year
exceeding 115% of the sum of all regular and 
 


 






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1
    separate
assessments payable during the
preceding fiscal 
2
    year, the
board of managers, upon written petition by unit 
3
    owners with 20 percent of
the votes of the association 
4
    delivered to the board within 14
days of the board action,

5
    shall call a meeting of the unit owners within 30 days of 
6
    the date of
delivery of the petition to consider the budget 
7
    or separate
assessment; unless a
majority of
the total 
8
    votes of the unit owners are cast at the meeting to reject 
9
    the
budget or separate assessment,
it is ratified, (iii) 
10
    that any common expense not set forth in the budget or
any 
11
    increase in assessments over the amount adopted in the 
12
    budget shall be
separately assessed against all unit 
13
    owners, (iv) that separate assessments for
expenditures 
14
    relating to emergencies or mandated by law may be adopted 
15
    by the
board of managers without being subject to unit 
16
    owner approval or the
provisions of item (ii) above or item 
17
    (v) below.  As used
herein, "emergency" means an immediate 
18
    danger to the structural integrity of
the
common elements 
19
    or to the life, health, safety or property of the unit 
20
    owners,
(v) that assessments
for additions and alterations 
21
    to the common elements or to association-owned
property not 
22
    included in the adopted annual budget, shall be separately

23
    assessed and are subject to approval of two-thirds of the 
24
    total votes of all
unit owners, (vi) that the board of 
25
    managers may adopt separate assessments
payable over more 
26
    than one fiscal year.  With respect to multi-year 
 


 






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1
    assessments
not governed by items (iv) and (v), the entire 
2
    amount of the multi-year
assessment shall be deemed 
3
    considered and authorized in the first fiscal year
in which 
4
    the assessment is approved;


5
        (9) that meetings of the board of managers shall be 
6
    open to any unit
owner, except for the portion of any 
7
    meeting held (i) to discuss litigation
when an action 
8
    against or on behalf of the particular association has been

9
    filed and is pending in a court or administrative tribunal,

10
    or when the board of managers finds that such an action is 
11
    probable
or imminent, (ii) to consider information 
12
    regarding appointment, employment
or dismissal of an 
13
    employee, or (iii) to discuss violations of rules and

14
    regulations of the association or a unit owner's unpaid 
15
    share of common
expenses; that any vote on these matters 
16
    shall be taken at a meeting or
portion thereof open to any 
17
    unit owner; that any unit owner may record the
proceedings 
18
    at meetings or portions thereof required to be open by this

19
    Act by tape, film or other means; that the board may 
20
    prescribe reasonable
rules and regulations to govern the 
21
    right to make such recordings, that
notice of such meetings 
22
    shall be mailed or delivered at least 48 hours
prior 
23
    thereto, unless a written waiver of  such notice is signed 
24
    by the
person or persons entitled to such notice pursuant 
25
    to the declaration,
bylaws, other condominium instrument, 
26
    or provision of law other than this
subsection before the 
 


 






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1
    meeting is convened, and that copies of notices of
meetings 
2
    of the board of managers shall be posted in entranceways,

3
    elevators, or other conspicuous places in the condominium 
4
    at least 48 hours
prior to the meeting of the board of 
5
    managers except where there is no
common entranceway for 7 
6
    or more units, the board of managers may designate
one or 
7
    more locations in the proximity of these units where the 
8
    notices of
meetings shall be posted;


9
        (10) that the board shall meet at least 4 times 
10
    annually;


11
        (11) that no member of the board or officer shall be 
12
    elected for a term
of more than 2 years, but that officers 
13
    and board members may succeed
themselves;


14
        (12) the designation of an officer to mail and receive 
15
    all notices and
execute amendments to condominium 
16
    instruments as provided for in this Act
and in the 
17
    condominium instruments;


18
        (13) the method of filling vacancies on the board
which 
19
    shall include authority for the remaining members of the 
20
    board to
fill the vacancy by two-thirds vote until the next 
21
    annual meeting of unit
owners or for a period terminating 
22
    no later than 30 days following the
filing of a petition 
23
    signed by unit owners holding 20% of the votes of the

24
    association requesting a meeting of the unit owners to fill 
25
    the vacancy for
the balance of the term, and that a meeting 
26
    of the unit owners shall be
called for purposes of filling 
 


 






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    a vacancy on the board no later than 30 days
following the 
2
    filing of a petition signed by unit owners holding 20% of 
3
    the
votes of the association requesting such a meeting, and 
4
    the method of filling
vacancies among the officers that 
5
    shall include the authority for the members
of the board to 
6
    fill the vacancy for the unexpired portion of the term;


7
        (14) what percentage of the board of managers, if other 
8
    than a majority,
shall constitute a quorum;


9
        (15) provisions concerning notice of board meetings to 
10
    members of the
board;


11
        (16) the board of managers may not enter into a 
12
    contract with a
current board member
or with a corporation 
13
    or partnership in which a board
member or a member of the 
14
    board member's immediate family has 25% or
more interest, 
15
    unless notice of intent to enter the
contract is given to 
16
    unit owners within 20 days after a decision is made
to 
17
    enter into the contract and the unit owners are
afforded an 
18
    opportunity by filing a petition, signed by 20% of the unit

19
    owners, for an election to approve or disapprove the 
20
    contract;
such petition shall be filed within 20 days after 
21
    such notice and such
election shall be held within 30 days 
22
    after filing the petition; for purposes
of this subsection, 
23
    a board member's immediate family means the board member's

24
    spouse, parents, and children;


25
        (17) that the board of managers may disseminate
to unit 
26
    owners biographical and background information about 
 


 






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1
    candidates for
election to the board if (i) reasonable 
2
    efforts to identify all candidates are
made and all 
3
    candidates are given an opportunity to include 
4
    biographical and
background information in the information 
5
    to be disseminated; and (ii) the
board does not express a 
6
    preference in favor of any candidate;


7
        (18) any proxy distributed for board elections
by the 
8
    board of managers gives unit owners the
opportunity to 
9
    designate any person as the proxy holder, and gives the 
10
    unit
owner the opportunity to express a preference for any 
11
    of the known
candidates for the board or to write in a 
12
    name;


13
        (19) that special meetings of the board of managers can 
14
    be called by
the president or 25% of the members of the 
15
    board; and


16
        (20) that the board of managers may establish
and 
17
    maintain a system of master metering of public utility 
18
    services and
collect payments in connection therewith, 
19
    subject to the requirements of the
Tenant Utility Payment 
20
    Disclosure Act.


21
    (b) (1) What percentage of the unit owners, if other than 
22
    20%, shall
constitute a quorum provided that, for 
23
    condominiums with 20 or more units,
the percentage of unit 
24
    owners constituting a quorum shall be 20% unless the
unit 
25
    owners holding a majority of the percentage interest in the

26
    association provide for a higher percentage;


 


 






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1
        (2) that the association shall have one class of 
2
    membership;


3
        (3) that the members shall hold an annual meeting, one 
4
    of the purposes
of which shall be to elect members of the 
5
    board of managers;


6
        (4) the method of calling meetings of the unit owners;


7
        (5) that special meetings of the members can be called 
8
    by the president,
board of managers, or by 20% of unit 
9
    owners;


10
        (6) that written notice of any membership meeting shall 
11
    be mailed
or delivered giving members no less than 10 and 
12
    no more than 30 days
notice of the time, place and purpose 
13
    of such meeting;


14
        (7) that voting shall be on a percentage basis, and 
15
    that the percentage
vote to which each unit is entitled is 
16
    the percentage interest of the
undivided ownership of the 
17
    common elements appurtenant thereto, provided
that the 
18
    bylaws may provide for approval by unit owners in 
19
    connection with
matters where the requisite approval on a 
20
    percentage basis is not specified
in this Act, on the basis 
21
    of one vote per unit;


22
        (8) that, where there is more than one owner of a unit, 
23
    if only one
of the multiple owners is present at a meeting 
24
    of the association, he is
entitled to cast all the votes 
25
    allocated to that unit, if more than one of
the multiple 
26
    owners are present, the votes allocated to that unit may be

 


 






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1
    cast only in accordance with the agreement of a majority in 
2
    interest of the
multiple owners, unless the declaration 
3
    expressly provides otherwise, that
there is majority 
4
    agreement if any one of the multiple owners cast the
votes 
5
    allocated to that unit without protest being made promptly 
6
    to the
person presiding over the meeting by any of the 
7
    other owners of the unit;


8
        (9)(A) that  unless the Articles of Incorporation or the 
9
    bylaws
otherwise
provide, and except as provided in 
10
    subparagraph (B) of this paragraph (9) in
connection with 
11
    board elections,
a unit owner may vote by proxy executed in 
12
    writing by the unit
owner or by his duly authorized 
13
    attorney in fact; that the proxy must bear the date of

14
    execution
and, unless the condominium instruments or the 
15
    written proxy itself provide
otherwise, is
invalid after 11 
16
    months from the date of its execution;


17
        (B) that if a rule adopted at least 120 days before a 
18
    board election
or the
declaration or bylaws provide for 
19
    balloting as set forth in this subsection,
unit
owners may 
20
    not vote by proxy in board elections, but may vote only (i) 
21
    by
submitting an association-issued ballot in person at the 
22
    election meeting or
(ii) by
submitting an 
23
    association-issued ballot to the association or its 
24
    designated
agent
by mail or other means of delivery 
25
    specified in the declaration, bylaws, or
rule; that
the 
26
    ballots shall be mailed or otherwise distributed to unit 
 


 






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1
    owners not less
than 10
and not more than 30 days before 
2
    the election meeting, and the board shall give
unit owners 
3
    not less than 21 days' prior written notice of the deadline 
4
    for
inclusion of a candidate's name on the ballots; that 
5
    the deadline shall be no
more
than 7 days before the 
6
    ballots are mailed or otherwise distributed to unit
owners; 
7
    that
every such ballot must include the names of all 
8
    candidates who have given the
board or its authorized agent 
9
    timely written notice of their candidacy and must
give the 
10
    person casting the ballot the opportunity to cast votes for 
11
    candidates
whose names do not appear on the ballot; that a 
12
    ballot received by the
association
or
its designated agent 
13
    after the close of voting shall not be counted; that a
unit

14
    owner
who submits a ballot by mail or other means of 
15
    delivery specified in the
declaration, bylaws, or rule may 
16
    request and cast a ballot in person at the
election

17
    meeting, and thereby void any ballot previously submitted 
18
    by that unit owner;


19
        (C) that if a written petition by unit owners with at 
20
    least 20% of the
votes of
the association is delivered to 
21
    the board within 14 days after the board's
approval
of a 
22
    rule adopted pursuant to subparagraph (B) of this paragraph 
23
    (9), the board
shall call a meeting of the unit owners 
24
    within 30 days after the date of
delivery of
the petition; 
25
    that unless a majority of the total votes of the unit 
26
    owners are
cast
at the
meeting to reject the rule, the rule 
 


 






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1
    is ratified;


2
        (10) that the association may, upon adoption of the 
3
    appropriate rules by
the board of managers, conduct 
4
    elections by secret ballot whereby the voting
ballot is 
5
    marked only with the percentage interest for the unit and 
6
    the vote
itself, provided that the board further adopt 
7
    rules to verify the status of the
unit owner issuing a 
8
    proxy or casting a ballot; and further, that a candidate

9
    for election to the board of managers or such
candidate's 
10
    representative shall have the right to be present at the

11
    counting of ballots at such election;


12
        (11) that in the event of a resale of a condominium 
13
    unit the purchaser
of a unit from a seller other than the 
14
    developer pursuant to an installment
contract for purchase 
15
    shall during such times as he or she resides in the
unit be 
16
    counted toward a quorum for purposes of election of members 
17
    of the
board of managers at any meeting of the unit owners 
18
    called for purposes of
electing members of the board, shall 
19
    have the right to vote for the
election of members of the 
20
    board of managers and to be elected to and serve
on the 
21
    board of managers unless the seller expressly retains in 
22
    writing any
or all of such rights.  In no event may the 
23
    seller and purchaser both be
counted toward a quorum, be 
24
    permitted to vote for a particular office or be
elected and 
25
    serve on the board.  Satisfactory evidence of the 
26
    installment
contact shall be made available to the 
 


 






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1
    association or its agents.  For
purposes of this subsection, 
2
    "installment contact" shall have the same
meaning as set 
3
    forth in Section 1 (e) of "An Act relating to installment

4
    contracts to sell dwelling structures", approved August 
5
    11, 1967, as amended;


6
        (12) the method by which matters subject to the 
7
    approval of unit owners
set forth in this Act, or in the 
8
    condominium instruments, will be
submitted to the unit 
9
    owners at special membership meetings called for such

10
    purposes; and


11
        (13) that matters subject to the affirmative vote of 
12
    not less than 2/3
of the votes of unit owners at a meeting 
13
    duly called for that purpose,
shall include, but not be 
14
    limited to:


15
            (i) merger or consolidation of the association;


16
            (ii) sale, lease, exchange, or other disposition 
17
        (excluding the mortgage
or pledge) of all, or 
18
        substantially all of the property and assets of the

19
        association; and


20
            (iii) the purchase or sale of land or of units on 
21
        behalf of all unit owners.

22
    (c) Election of a president from among the board of 
23
managers, who shall
preside over the meetings of the board of 
24
managers and of the unit owners.

25
    (d) Election of a secretary from among the board of 
26
managers, who shall
keep the minutes of all meetings
of the 
 


 






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1
board of managers and of the unit owners and who shall, in 
2
general,
perform all the duties incident to the office of 
3
secretary.

4
    (e) Election of a treasurer from among the board of 
5
managers, who shall
keep the financial records and
books of 
6
account.

7
    (f) Maintenance, repair and replacement of the common 
8
elements and
payments therefor, including the method of 
9
approving payment vouchers.

10
    (g) An association with 30 or more units shall obtain and 
11
maintain
fidelity insurance covering persons who control or 
12
disburse funds of the
association for the maximum amount of 
13
coverage available to protect funds
in the custody or control 
14
of the association plus the association reserve
fund.  All 
15
management companies which are responsible for the funds held 
16
or
administered by the association shall maintain and furnish 
17
to the
association a fidelity bond for the maximum amount of 
18
coverage available to
protect funds in the custody of the 
19
management company at any time.  The
association shall bear the 
20
cost of the fidelity insurance and fidelity
bond, unless 
21
otherwise provided by contract between the association and a

22
management company.  The association shall be the direct obligee 
23
of any
such fidelity bond.  A management company holding reserve 
24
funds of an
association shall at all times maintain a separate 
25
account for each
association, provided, however, that for 
26
investment purposes, the Board of
Managers of an association 
 


 






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1
may authorize a management company to maintain
the 
2
association's reserve funds in a single interest bearing 
3
account with
similar funds of other associations.  The 
4
management company shall at all
times maintain records 
5
identifying all moneys of each association in such
investment 
6
account. The management company may hold all operating funds of

7
associations which it manages in a single operating account but 
8
shall at
all times maintain records identifying all moneys of 
9
each association in
such operating account. Such operating and 
10
reserve funds held by the
management company for the 
11
association shall not be subject to attachment
by any creditor 
12
of the management company.

13
    For the purpose of this subsection a management company 
14
shall be
defined as a person, partnership, corporation, or 
15
other legal entity
entitled to transact business on behalf of 
16
others, acting on behalf of or
as an agent for a unit owner, 
17
unit owners or association of unit owners for
the purpose of 
18
carrying out the duties, responsibilities, and other

19
obligations necessary for the day to day operation and 
20
management of any
property subject to this Act.  For purposes of 
21
this subsection, the term
"fiduciary insurance coverage" shall 
22
be defined as both a fidelity bond and
directors and officers 
23
liability coverage, the fidelity bond in the full
amount of 
24
association funds and association reserves that will be in the

25
custody of the association, and the directors and officers 
26
liability
coverage at a level as shall be determined to be 
 


 






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1
reasonable by the board of
managers, if not otherwise 
2
established by the declaration or by laws.

3
    Until one year after the effective date of this amendatory 
4
Act of 1985,
if a condominium association has reserves plus 
5
assessments in excess of
$250,000 and cannot reasonably obtain 
6
100% fidelity bond coverage for such
amount, then it must 
7
obtain a fidelity bond coverage of $250,000.

8
    (h) Method of estimating the amount of the annual budget, 
9
and the manner
of assessing and collecting from the unit owners 
10
their respective shares of
such estimated expenses, and of any 
11
other expenses lawfully agreed upon.

12
    (i) That upon 10 days notice to the manager or board of 
13
managers and
payment of a reasonable fee, any unit owner shall 
14
be furnished a statement
of his account setting forth the 
15
amount of any unpaid assessments or other
charges due and owing 
16
from such owner.

17
    (j) Designation and removal of personnel necessary for the 
18
maintenance,
repair and replacement of the common elements.

19
    (k) Such restrictions on and requirements respecting the 
20
use and
maintenance of the units and the use of the common 
21
elements, not set forth
in the declaration, as are designed to 
22
prevent unreasonable interference
with the use of their 
23
respective units and of the common elements by the
several unit 
24
owners. Restrictions regarding the use of the units may include 
25
other prohibitions on, or the allowance of, smoking tobacco 
26
products. 

 


 






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1
    (l) Method of adopting and of amending administrative rules 
2
and
regulations governing the operation and use of the common 
3
elements.

4
    (m) The percentage of votes required to modify or amend the 
5
bylaws, but
each one of the particulars set forth in this 
6
section shall always be
embodied in the bylaws.

7
    (n) (i) The provisions of this Act, the declaration, 
8
bylaws, other
condominium instruments, and rules and 
9
regulations that relate to the use
of the individual unit or 
10
the common elements shall be applicable to
any person leasing a 
11
unit and shall be deemed to be incorporated in any
lease 
12
executed or renewed on or after the effective date of this 
13
amendatory
Act of 1984. (ii) With regard to any lease entered 
14
into subsequent to the
effective date of this amendatory Act of 
15
1989, the unit owner leasing the
unit shall deliver a copy of 
16
the signed lease to the board or if the
lease is oral, a 
17
memorandum of the lease, not later than the date of
occupancy 
18
or 10 days after the lease is signed, whichever occurs first. 
19
In
addition to any other remedies, by filing an action jointly 
20
against the
tenant and the unit owner, an association may seek 
21
to enjoin a tenant from
occupying a unit or seek to evict a 
22
tenant under the provisions of Article
IX of the Code of Civil 
23
Procedure for failure of the lessor-owner to
comply with the 
24
leasing requirements prescribed by
this Section or by the 
25
declaration, bylaws, and
rules and regulations. The board of 
26
managers may proceed directly against a
tenant, at law or in 
 


 






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1
equity, or under the provisions of Article IX of the
Code of 
2
Civil Procedure, for any other breach by tenant of any

3
covenants, rules, regulations or bylaws.

4
    (o) The association shall have no authority to forbear the 
5
payment
of assessments by any unit owner.

6
    (p) That when 30% or fewer of the units, by number,
possess 
7
over 50% in the aggregate of the votes in the association,
any 
8
percentage vote of members specified herein or in the 
9
condominium
instruments shall require the specified percentage 
10
by number of units
rather than by percentage of interest in the 
11
common elements allocated
to units that would otherwise be 
12
applicable. For purposes of this subsection (p), when making a 
13
determination of whether 30% or fewer of the units, by number, 
14
possess over 50% in the aggregate of the votes in the 
15
association,  a unit shall not include a garage unit or a 
16
storage unit.


17
    (q) That a unit owner may not assign, delegate, transfer, 
18
surrender, or
avoid the duties, responsibilities, and 
19
liabilities of a unit owner under this
Act, the condominium 
20
instruments, or the rules and regulations of the
Association; 
21
and that such an attempted assignment, delegation, transfer,

22
surrender, or avoidance shall be deemed void.

23
    The provisions of this Section are applicable to all 
24
condominium
instruments recorded under this Act.  Any portion of 
25
a condominium
instrument which contains provisions contrary to 
26
these provisions shall be
void as against public policy and 
 


 






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1
ineffective.  Any such instrument which
fails to contain the 
2
provisions required by this Section shall be deemed to

3
incorporate such provisions by operation of law.

4
(Source: P.A. 95-624, eff. 6-1-08.)

 

5
    Section 99. Effective date. This Act takes effect January 
6
1, 2009.