Full Text of SB2570 94th General Assembly
SB2570 94TH GENERAL ASSEMBLY
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94TH GENERAL ASSEMBLY
State of Illinois
2005 and 2006 SB2570
Introduced 1/20/2006, by Sen. Susan Garrett SYNOPSIS AS INTRODUCED: |
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765 ILCS 605/9 |
from Ch. 30, par. 309 |
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Amends the Condominium Property Act. Provides that a purchaser of a condominium unit at a judicial foreclosure sale, or a mortgagee who receives a deed in lieu of foreclosure or a judgment of foreclosure or who otherwise takes possession of a condominium unit pursuant to a court order, must pay the proportionate share of the common expenses for the unit which would have become due in the absence of any assessment acceleration during the 6 months immediately prior to the filing of an action to enforce the collection of assessments.
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| HOUSING AFFORDABILITY IMPACT NOTE ACT MAY APPLY | |
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A BILL FOR
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SB2570 |
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LRB094 18528 AJO 54463 b |
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| AN ACT concerning condominium property.
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| Be it enacted by the People of the State of Illinois,
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| represented in the General Assembly:
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| Section 5. The Condominium Property Act is amended by | 5 |
| changing Section 9 as follows:
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| (765 ILCS 605/9) (from Ch. 30, par. 309)
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| Sec. 9. Sharing of expenses - Lien for nonpayment.
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| (a) All common expenses incurred or accrued prior to the | 9 |
| first conveyance
of a unit shall be paid by the developer, and | 10 |
| during this period no common
expense assessment shall be | 11 |
| payable to the association. It shall be the duty
of each unit | 12 |
| owner including the developer to pay his proportionate share of
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| the common expenses commencing with the first conveyance. The | 14 |
| proportionate
share shall be in the same ratio as his | 15 |
| percentage of ownership in the common
elements set forth in the | 16 |
| declaration.
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| (b) The condominium instruments may provide that common | 18 |
| expenses for
insurance premiums be assessed on a basis | 19 |
| reflecting increased charges for
coverage on certain units.
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| (c) Budget and reserves.
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| (1) The board of managers shall prepare and distribute | 22 |
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all unit owners a detailed proposed annual budget, | 23 |
| setting forth with
particularity all anticipated common | 24 |
| expenses by category as well as all
anticipated assessments | 25 |
| and other income. The initial budget and common
expense | 26 |
| assessment based thereon shall be adopted prior to the
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| conveyance of any unit. The budget shall also set forth | 28 |
| each unit owner's
proposed common expense assessment.
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| (2) All budgets adopted by a board of managers on or | 30 |
| after July 1, 1990
shall provide for reasonable reserves | 31 |
| for capital expenditures and deferred
maintenance for | 32 |
| repair or replacement of the common elements. To determine
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LRB094 18528 AJO 54463 b |
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| the amount of reserves appropriate for an association, the | 2 |
| board of
managers shall take into consideration the | 3 |
| following: (i) the repair and
replacement cost, and the | 4 |
| estimated useful life, of the property which the
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| association is obligated to maintain, including but not | 6 |
| limited to
structural and mechanical components, surfaces | 7 |
| of the buildings and common
elements, and energy systems | 8 |
| and equipment; (ii) the current and
anticipated return on | 9 |
| investment of association funds; (iii) any
independent | 10 |
| professional reserve study which the association may | 11 |
| obtain;
(iv) the financial impact on unit owners, and the | 12 |
| market value of the
condominium units, of any assessment | 13 |
| increase needed to fund reserves; and
(v) the ability of | 14 |
| the association to obtain financing or refinancing.
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| (3) Notwithstanding the provisions of this subsection | 16 |
| (c), an
association without a reserve requirement in its | 17 |
| condominium
instruments may elect to waive in whole or in | 18 |
| part the reserve requirements
of this Section by a vote of | 19 |
| 2/3 of the total votes of the association.
Any association | 20 |
| having elected under this paragraph (3) to waive the
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| provisions of subsection (c) may by a vote of 2/3 of the | 22 |
| total votes of the
association elect to again be governed | 23 |
| by the requirements of subsection (c).
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| (4) In the event that an association elects to waive | 25 |
| all or part of
the reserve requirements of this Section, | 26 |
| that fact must be
disclosed after the meeting at which the | 27 |
| waiver occurs by the
association in the financial | 28 |
| statements of the association and, highlighted
in bold | 29 |
| print, in the response to any request of a prospective | 30 |
| purchaser
for the information prescribed under Section | 31 |
| 22.1; and no member of the
board of managers or the | 32 |
| managing agent of the association shall be liable,
and no | 33 |
| cause of action may be brought for damages against these | 34 |
| parties,
for the lack or inadequacy of reserve funds in the | 35 |
| association budget.
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| (d) (Blank).
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| (e) The condominium instruments may provide for the | 2 |
| assessment,
in connection with expenditures for the limited | 3 |
| common elements, of only those
units to which the limited | 4 |
| common elements are assigned.
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| (f) Payment of any assessment shall be in amounts and at | 6 |
| times
determined by the board of managers.
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| (g) Lien.
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| (1) If any unit owner shall fail or refuse to make any | 9 |
| payment of
the common expenses or the amount of any unpaid | 10 |
| fine when due, the
amount thereof together with any | 11 |
| interest, late charges, reasonable
attorney fees incurred | 12 |
| enforcing the covenants of the condominium
instruments, | 13 |
| rules and regulations of the board of managers, or any | 14 |
| applicable
statute or ordinance, and costs of collections | 15 |
| shall constitute a lien on the
interest of the unit owner | 16 |
| in the property prior to all other
liens and encumbrances, | 17 |
| recorded or unrecorded, except only (a) taxes,
special | 18 |
| assessments and special taxes theretofore or thereafter | 19 |
| levied by
any political subdivision or municipal | 20 |
| corporation of this State and other
State or federal taxes | 21 |
| which by law are a lien on the interest of the
unit owner | 22 |
| prior to preexisting recorded encumbrances thereon and
(b) | 23 |
| encumbrances on the interest of the unit owner recorded
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| prior to the date of such failure or refusal which by law | 25 |
| would be a lien
thereon prior to subsequently recorded | 26 |
| encumbrances. Any action
brought to extinguish the lien of | 27 |
| the association shall include the
association as a party.
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| (2) With respect to encumbrances executed prior to | 29 |
| August 30, 1984 or
encumbrances executed subsequent to | 30 |
| August 30, 1984 which are neither
bonafide first mortgages | 31 |
| nor trust deeds and which encumbrances contain a
statement | 32 |
| of a mailing address in the State of Illinois where notice | 33 |
| may be
mailed to the encumbrancer thereunder, if and | 34 |
| whenever and as often as the
manager or board of managers | 35 |
| shall send, by United States certified or
registered mail, | 36 |
| return receipt requested, to any such encumbrancer at the
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| mailing address set forth in the recorded encumbrance a | 2 |
| statement of the
amounts and due dates of the unpaid common | 3 |
| expenses with respect to the
encumbered unit, then, unless | 4 |
| otherwise provided in the declaration or bylaws,
the prior | 5 |
| recorded encumbrance shall be subject to the lien of all | 6 |
| unpaid
common expenses with respect to the unit which | 7 |
| become due and payable within a
period of 90 days after the | 8 |
| date of mailing of each such notice.
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| (3) The purchaser of a condominium unit at a judicial
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| foreclosure sale, or a mortgagee who receives title to a | 11 |
| unit by deed in
lieu of foreclosure or judgment by common | 12 |
| law strict foreclosure or
otherwise takes possession | 13 |
| pursuant to court order under the Illinois
Mortgage | 14 |
| Foreclosure Law, shall have the duty to pay the | 15 |
| proportionate share of the common expenses for the unit | 16 |
| which would have become due in the absence of any | 17 |
| assessment acceleration during the 6 months immediately | 18 |
| preceding institution of an action to enforce the | 19 |
| collection of assessments; and thereafter, shall have the | 20 |
| duty to pay the unit's
proportionate share of the common | 21 |
| expenses for the unit assessed from and
after the first day | 22 |
| of the month after the date of the judicial foreclosure
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| sale, delivery of the deed in lieu of foreclosure, entry of | 24 |
| a judgment in
common law strict foreclosure, or taking of | 25 |
| possession pursuant to such
court order. Such payment | 26 |
| confirms the extinguishment of any lien created
pursuant to | 27 |
| paragraph (1) or (2) of this subsection (g) by virtue of | 28 |
| the
failure or refusal of a prior unit owner to make | 29 |
| payment of common
expenses, where the judicial foreclosure | 30 |
| sale has been confirmed by order
of the court, a deed in | 31 |
| lieu thereof has been accepted by the lender, or a
consent | 32 |
| judgment has been entered by the court.
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| (h) A lien for common expenses shall be in favor of the | 34 |
| members of the
board of managers and their successors in office | 35 |
| and shall be for the
benefit of all other unit owners. Notice | 36 |
| of the lien may be recorded by
the board of managers, or if the |
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| developer is the manager or has a majority
of seats on the | 2 |
| board of managers and the manager or board of managers
fails to | 3 |
| do so, any unit owner may record notice of the lien. Upon the
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| recording of such notice the lien may be foreclosed by an | 5 |
| action brought in
the name of the board of managers in the same | 6 |
| manner as a mortgage of real
property.
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| (i) Unless otherwise provided in the declaration, the | 8 |
| members
of the board of managers and their successors in | 9 |
| office, acting on behalf
of the other unit owners, shall have | 10 |
| the power to bid on the
interest so foreclosed at the | 11 |
| foreclosure sale, and to acquire and
hold, lease, mortgage and | 12 |
| convey it.
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| (j) Any encumbrancer may from time to time request in | 14 |
| writing a written
statement from the manager or board of | 15 |
| managers setting forth the unpaid
common expenses with respect | 16 |
| to the unit covered by his encumbrance.
Unless the request is | 17 |
| complied with within 20 days, all unpaid common
expenses which | 18 |
| become due prior to the date of the making of such request
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| shall be subordinate to the lien of the encumbrance. Any | 20 |
| encumbrancer
holding a lien on a unit may pay any unpaid common | 21 |
| expenses payable with
respect to the unit, and upon payment the | 22 |
| encumbrancer shall have a lien on
the unit for the amounts paid | 23 |
| at the same rank as the lien of his encumbrance.
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| (k) Nothing in Public Act 83-1271 is intended to change the | 25 |
| lien
priorities of any encumbrance created prior to August 30, | 26 |
| 1984.
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| (Source: P.A. 91-357, eff. 7-29-99.)
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