Collecting Delinquent Assessments:

The collection of monthly assessments is the association’s primary source of revenue. As such, it is vitally important that a board maintain a strict collection policy in order to effectively deal with delinquent owners. Once an owner gets more than two months delinquent, we recommend that the association work quickly to, at a minimum, establish a payment plan with the delinquent owner. If the account is not cleared up shortly, we recommend that an attorney be contacted.

If the account remains past due, the association can seek to terminate the unit owner’s possession rights through an eviction action. The first step in the eviction process is the delivery of a written thirty-day notice. A lien should also be prepared and recorded against the unit. The filing of the lien may prevent the unit owner from refinancing his or her mortgage without first satisfying the lien. The filing of the lien may also protect the association’s interest in the event of a bankruptcy filing and/or foreclosure.

If an eviction action is filed, the defendant must then be served by the sheriff’s office with a copy of the complaint and summons. In Cook County, the trial date can occur as soon as three weeks after the filing of the complaint. However, this trial date is subject to being delayed if the deputy sheriff is unable to serve the defendant. Once the defendant has been served, and the trial date arrives, the defendant often times will not even appear and will be “defaulted”. In that instance, the judge will enter an order of possession in favor of the association. However, if the unit owner is still occupying the unit, the court may “stay” the eviction (i.e., delay the eviction) a minimum of 60 days. Once the stay period concludes, the association can secure possession, rent the unit out and collect rent to be applied against the delinquency.

It is critical, however, that the association quickly resolve the delinquency prior to the time that the unit owner’s lender files a foreclosure action. Once the mortgage lender completes the foreclosure of the unit, and the unit is sold at a sheriff’s sale, the association will be unable to collect unpaid assessments.

Enforcement of Association Rules:

The following Q&A appeared in the “Ask an Attorney” section of the October 2004 newsletter for the Association of Condominium Townhouse & Homeowners Association (http://www.actha.org)

Question: In 1995, our condominium association amended our declaration to prohibit pets but grandfathering in current pets. However, once the pet expired all owners would be prohibited from having pets. Recently, our board learned that the son of an owner (who lives in the unit) has two cats and has admitted to having them for 2 years. We informed him that he would need to get rid of the cats or would be fined. At the time, we did not have any policy on fine amounts. His response was to fine him and he would pay the fines.

Since then the board adopted a rule of $10 per day for a violation of this rule effective July 17.

What recourse does a board have if a rule is violated and the owner’s response is to continuously break the rule yet pay the fine? What is considered a “reasonable” fine as set forth in the Illinois Condominium Property Act? Is it your opinion that a $10 fine per day would be considered reasonable?


Answer: It is quite apparent that your association has enacted a well reasoned, and more importantly, enforceable pet restriction. Unfortunately, this unit owner simply does not want to cooperate.

The first thing your association did right was to implement this pet restriction by permanently amending your declaration; an action that likely required approval of a certain percentage of unit owners. In contrast, many boards institute similar restrictions (such as leasing restrictions) by way of board rule. While this alternative is generally permissible, courts often give greater deference if the restriction was made to the governing document of the association. Secondly, this pet “grandfather” clause, also known as a “pet amortization” clause, was a show of reasonableness by the prior board that certainly helped prevent a revolt by the pet owners at the time.

With respect to this flagrant violator, one option the board now has is to increase the amount of the fine. The Illinois Condominium Property Act does not provide guidance as to what is a “reasonable” fine. A good resource is an experienced property manager who may be willing to share an effective fine schedule used with other associations. The board can also check with its local municipality as to its schedule of fines for common ordinance violations. Further, common sense dictates that the amount of the fine should take into account the seriousness of the offense and the overall circumstances. Given that this unit owner is willingly paying the $10 a day fine, he or she should now have a hard time arguing that the $15 fine is somehow unfair or unreasonable.

Please keep in mind that the Illinois Condominium Act states that before levying a fine, the board must provide the owner with notice and “an opportunity to be heard.” Another common pitfall is the selective enforcement of a rule or restriction by a board, or the failure to enforce it in a timely manner.

The final option available to the board is the filing of a lawsuit seeking a court order requiring the defaulting owner to immediately comply with the restriction. You must look to your declaration to determine the procedures necessary before seeking court intervention. One typical provision requires the delivery of a thirty-day notice of violation letter to the defaulting unit owner. Most declarations allow the board to recover attorneys fees in the enforcement action. However, the judge has discretion in awarding attorneys fees, and the ultimate award oftentimes does not equal the amount the attorney has actually billed to the association.

BOARD MEETINGS v. MEMBERSHIP MEETINGS

This article appeared in the September 2006 newsletter for the Association of Condominium Townhouse & Homeowners Association (www.actha.org)

In the context of condominium governance, the basic difference between a board meeting and a membership meeting is self-evident. A membership meeting obviously allows involvement of all condominium unit owners, while a board meeting contemplates participation of only the elected representatives of the condominium association. However, newly formed condominium boards are often uncertain as to which meeting should be called in certain circumstances, or are unfamiliar with the legal requirements for conducting a proper meeting.

The Illinois condominium statute, and the bylaws of each condominium, should indicate when a membership meeting is required. For instance, a membership meeting is mandatory when adopting the annual budget, enacting rules of the association, amending the declaration or bylaws, and of course, conducting board elections. These association matters are of significant interest to all unit owners. Therefore, in order to promote a strong turnout, the Illinois statute requires adequate notice of the scheduling of a membership meeting. Specifically, the law requires “written notice of no less than 10 and no more than 30 days notice of the time, place and purpose of such meeting.” Although the goal is to promote participation and input from the owners, one must remember that condominium associations are not a true democracy. As such, while the owners can attend and participate, in many instances, owners are not permitted to ultimately vote on the matter at hand.

In contrast, meetings of the board are an opportunity for the board to manage the day-to-day administration of the condominium association. Although unit owners never have a right to participate or vote at board meetings, the condominium statute states that all board meetings must be “open” to the owners. As such, the unit owners are again entitled to notice. However the length of the advance notice is much more relaxed, as the board is merely required to provide 48 hours notice of the time and location of the board meeting. Specifically, the condominium statute requires that notice must be “mailed or delivered” at least 48 hours prior, thereto, “. . . and copies of the notice of meetings . . . shall be posted in the entranceways, elevators, or other conspicuous places in the condominium at least 48 hours prior to the meeting.”

There are certain exceptions to the open meetings requirement. Specifically, the condominium statute permits a “closed door” board meeting under three circumstances; 1) discussion by the board of “pending” or “imminent” litigation in which the association is a party, 2) to consider information regarding employment or dismissal of an employee, and 3) to discuss violations of rules and regulations of the association or a unit owner's unpaid share of common expenses. However, the condominium statute requires that any final decisions made by the board in executive session must be voted on at an open meeting. This concept of requiring the board to memorialize actions at the open meeting is known as “ratification”.

Any unit owner may record, via audio or video, the proceedings at meetings, though the board “may prescribe reasonable rules and regulations” with respect to the recording. Clearly an owner does not typically video record a board meeting for family entertainment purposes.  Rather the owner has for whatever reason become angered or litigious.  One approach to prevent the alienation of unit owners is to provide for an “owner’s forum” during the meeting. This forum gives the owners an opportunity to comment or ask questions of the board either at the beginning or end of the meeting.  Even though the owners have no right to vote on board matters, the owner’s forum provides the owners with a sense of participation in the direction and affairs of the association.  

While the owners are entitled to notice of an “open” board meeting, the next question becomes when exactly is a board meeting necessary. The condominium statute defines a board meeting as “any gathering of a quorum of the members of the Board . . .  held for the purpose of conducting board business.”  However, if two board members are chatting in the hallway about the menu for the upcoming association picnic, are they really conducting board business? Would the answer to this question change if the board members were instead discussing a more important issue, such as which contractor to hire for the proposed hallway renovation project? What if the two board members actually reached a decision about which contractor to hire during this hallway meeting?  In other words, when is board business actually being “conducted”? While this term is not defined, one can gain insight on the issue when noting the legislative history of this section of the statute. Specifically, in 1994 the Illinois legislature amended this provision of the statute by substituting the phrase “discussing board business” with “conducting board business”.

With this knowledge of the legislative history, it becomes apparent that the board’s informal discussion of association issues is permissible. Therefore, board members are able to meet informally to gather information, discuss administrative matters, and even appoint committees to evaluate proposals from contractors or vendors.  Once again, however, any formal votes or decisions on a matter must take place at an open meeting. Further, boards must be careful to avoid discussing all important issues outside of a meeting so as to turn the actual meeting into a mere voting exercise. While such a practice may not be a technical violation of the current condominium law, this practice can create a secretive environment and will quickly erode the goodwill of certain unit owners.