(765 ILCS 605/2) (from Ch. 30, par. 302)
Sec. 2.
Definitions.
As used in this Act, unless the context otherwise
requires:
(a) "Declaration" means the instrument by which the property is
submitted to the provisions of this Act, as hereinafter provided, and such
declaration as from time to time amended.
(b) "Parcel" means the lot or lots, tract or tracts of land, described
in the declaration, submitted to the provisions of this Act.
(c) "Property" means all the land, property and space comprising the
parcel, all improvements and structures erected, constructed or contained
therein or thereon, including the building and all easements, rights and
appurtenances belonging thereto, and all fixtures and equipment intended
for the mutual use, benefit or enjoyment of the unit owners, submitted to
the provisions of this Act.
(d) "Unit" means a part of the property designed and intended for any type
of independent use.
(e) "Common Elements" means all portions of the property except the
units, including limited common elements unless otherwise specified.
(f) "Person" means a natural individual, corporation, partnership,
trustee or other legal entity capable of holding title to real property.
(g) "Unit Owner" means the person or persons whose estates or interests,
individually or collectively, aggregate fee simple absolute ownership of a
unit, or, in the case of a leasehold condominium, the lessee or lessees of a
unit whose leasehold ownership of the unit expires simultaneously with the
lease described in item (x) of this Section.
(h) "Majority" or "majority of the unit owners" means the owners of more
than 50% in the aggregate in interest of the undivided ownership of the
common elements. Any specified percentage of the unit owners means such
percentage in the aggregate in interest of such undivided ownership.
"Majority" or "majority of the members of the board of managers" means
more than 50% of the total number of persons constituting such board
pursuant to the bylaws. Any specified percentage of the members of the
board of managers means that percentage of the total number of persons
constituting such board pursuant to the bylaws.
(i) "Plat" means a plat or plats of survey of the parcel and of all
units in the property submitted to the provisions of this Act, which may
consist of a three‑dimensional horizontal and vertical delineation of all
such units.
(j) "Record" means to record in the office of the recorder or,
whenever required, to file in the office of the Registrar of Titles of the
county wherein the property is located.
(k) "Conversion Condominium" means a property which contains structures,
excepting those newly constructed and intended for condominium ownership, which
are, or have previously been, wholly or partially occupied before recording of
condominium instruments by persons other than those who have contracted for the
purchase of condominiums.
(l) "Condominium Instruments" means all documents and authorized
amendments thereto recorded pursuant to the provisions of the Act,
including the declaration, bylaws and plat.
(m) "Common Expenses" means the proposed or actual expenses affecting
the property, including reserves, if any, lawfully assessed by the Board
of Managers of the Unit Owner's Association.
(n) "Reserves" means those sums paid by unit owners which are separately
maintained by the board of managers for purposes specified by the board
of managers or the condominium instruments.
(o) "Unit Owners' Association" or "Association" means the association
of all the unit owners, acting pursuant to bylaws through its duly elected
board of managers.
(p) "Purchaser" means any person or persons other than the Developer who
purchase a unit in a bona fide transaction for value.
(q) "Developer" means any person who submits property legally or equitably
owned in fee simple by the developer, or leased to the developer
under a lease described in item (x) of this Section, to the
provisions of this
Act, or any person who offers units
legally or equitably owned in fee simple by the developer, or leased to the
developer under a lease described in item (x) of this Section, for
sale
in the ordinary course of
such person's business, including any successor or successors to
such developers' entire
interest in the property other than the purchaser of an individual unit.
(r) "Add‑on Condominium" means a property to which additional property
may be added in accordance with condominium instruments and this Act.
(s) "Limited Common Elements" means a portion of the common elements so
designated in the declaration as being reserved for the use of a certain
unit or units to the exclusion of other units, including but not limited
to balconies, terraces, patios and parking spaces or facilities.
(t) "Building" means all structures, attached or unattached, containing
one or more units.
(u) "Master Association" means an organization described in Section 18.5
whether or not it is also an association described in Section 18.3.
(v) "Developer Control" means such control at a time prior to the
election
of the Board of Managers provided for in Section 18.2(b) of this Act.
(w) "Meeting of Board of Managers or Board of Master Association"
means any gathering of a quorum of the members of the Board
of Managers or Board of the Master Association held for the purpose of
conducting board business.
(x) "Leasehold Condominium" means a property submitted to the provisions
of this Act which is subject to a lease, the expiration or termination of which
would terminate the condominium and the lessor of which is (i) exempt from
taxation
under Section 501(c)(3) of the Internal Revenue Code of 1986, as amended,
(ii) a
limited liability company whose sole member is exempt from taxation under
Section 501
(c)(3) of the Internal Revenue Code of 1986, as amended, or (iii)
a Public Housing Authority created pursuant to the
Housing Authorities Act that is located in a municipality having a population
in
excess of 1,000,000 inhabitants.
(Source: P.A. 93‑474, eff. 8‑8‑03.)
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(765 ILCS 605/4) (from Ch. 30, par. 304)
Sec. 4.
Declaration ‑ Contents.) The declaration shall set forth the
following particulars:
(a) The legal description of the parcel.
(b) The legal description of each unit, which may consist of the
identifying number or symbol of such unit as shown on the plat.
(c) The name of the condominium, which name shall include the word
"Condominium" or be followed by the words "a Condominium".
(d) The name of the city and county or counties in which the condominium is
located.
(e) The percentage of ownership interest in the common elements
allocated to each unit. Such percentages shall be computed by taking as
a basis the value of each unit in relation to the value of the property
as a whole, and having once been determined and set forth as herein provided,
such percentages shall remain constant unless otherwise provided in this
Act or thereafter changed by agreement of all unit owners.
(f) If applicable, all matters required by this Act in connection
with an add‑on condominium.
(g) A description of both the common and limited common elements, if
any, indicating the manner of their assignment to a unit or units.
(h) If applicable, all matters required by this Act in connection
with a conversion condominium.
(h‑5) If the condominium is a leasehold condominium, then:
(1) The date of recording and recording document |
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number for the lease creating a leasehold interest as described in item (x) of Section 2;
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(2) The date on which the lease is scheduled to
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(3) The legal description of the property subject to
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(4) Any right of the unit owners to redeem the
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reversion and the manner whereby those rights may be exercised, or a statement that the unit owners do not have such rights;
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(5) Any right of the unit owners to remove any
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improvements within a reasonable time after the expiration or termination of the lease, or a statement that the unit owners do not have such rights;
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(6) Any rights of the unit owners to renew the lease
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and the conditions of any renewal, or a statement that the unit owners do not have such rights; and
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(7) A requirement that any sale of the property
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pursuant to Section 15 of this Act, or any removal of the property pursuant to Section 16 of this Act, must be approved by the lessor under the lease.
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(i) Such other lawful provisions not inconsistent with the
provisions of this Act as the owner or owners may deem desirable in
order to promote and preserve the cooperative aspect of ownership of the
property and to facilitate the proper administration thereof.
(Source: P.A. 89‑89, eff. 6‑30‑95.)
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(765 ILCS 605/4.1) (from Ch. 30, par. 304.1)
Sec. 4.1.
Construction, interpretation, and validity of Condominium
Instruments.
(a) Except to the extent otherwise provided by the declaration or other
condominium instruments:
(1) The terms defined in Section 2 of this Act shall |
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be deemed to have the meaning specified therein unless the context otherwise requires.
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(2) To the extent that perimeter and partition
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walls, floors or ceilings are designated as the boundaries of the units or of any specified units, all decorating, wall and floor coverings, paneling, molding, tiles, wallpaper, paint, finished flooring and any other materials constituting any part of the finished surfaces thereof, shall be deemed a part of such units, while all other portions of such walls, floors or ceilings and all portions of perimeter doors and all portions of windows in perimeter walls shall be deemed part of the common elements.
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(3) If any chutes, flues, ducts, conduits, wires,
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bearing walls, bearing columns, or any other apparatus lies partially within and partially outside of the designated boundaries of a unit, any portions thereof serving only that unit shall be deemed a part of that unit, while any portions thereof serving more than one unit or any portion of the common elements shall be deemed a part of the common elements.
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(4) Subject to the provisions of paragraph (3) of
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subsection (a), all space and other fixtures and improvements within the boundaries of a unit shall be deemed a part of that unit.
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(5) Any shutters, awnings, window boxes, doorsteps,
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porches, balconies, patios, perimeter doors, windows in perimeter walls, and any other apparatus designed to serve a single unit shall be deemed a limited common element appertaining to that unit exclusively.
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(6) All provisions of the declaration, bylaws and
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other condominium instruments are severable.
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(b) Except to the extent otherwise provided by the declaration or by
other condominium instruments recorded prior to the effective date of this
amendatory Act of 1984, in the event of a conflict between the provisions
of the declaration
and the bylaws or other condominium instruments, the declaration prevails
except to the extent the declaration
is inconsistent with this Act.
(c) A provision in the initial declaration limiting ownership, rental
or occupancy of a condominium unit to a
person 55 years of age or older shall be valid and deemed not to be in
violation of Article 3 of the Illinois Human Rights Act provided that
the person or the immediate
family of a person owning, renting or lawfully occupying such unit prior
to the recording of
the initial declaration shall not be deemed to be in
violation of such age restriction so long as they continue to own or reside
in such unit.
(Source: P.A. 89‑41, eff. 6‑23‑95.)
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(765 ILCS 605/9) (from Ch. 30, par. 309)
Sec. 9.
Sharing of expenses ‑ Lien for nonpayment.
(a) All common expenses incurred or accrued prior to the first conveyance
of a unit shall be paid by the developer, and during this period no common
expense assessment shall be payable to the association. It shall be the duty
of each unit owner including the developer to pay his proportionate share of
the common expenses commencing with the first conveyance. The proportionate
share shall be in the same ratio as his percentage of ownership in the common
elements set forth in the declaration.
(b) The condominium instruments may provide that common expenses for
insurance premiums be assessed on a basis reflecting increased charges for
coverage on certain units.
(c) Budget and reserves.
(1) The board of managers shall prepare and |
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distribute to all unit owners a detailed proposed annual budget, setting forth with particularity all anticipated common expenses by category as well as all anticipated assessments and other income. The initial budget and common expense assessment based thereon shall be adopted prior to the conveyance of any unit. The budget shall also set forth each unit owner's proposed common expense assessment.
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(2) All budgets adopted by a board of managers on or
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after July 1, 1990 shall provide for reasonable reserves for capital expenditures and deferred maintenance for repair or replacement of the common elements. To determine the amount of reserves appropriate for an association, the board of managers shall take into consideration the following: (i) the repair and replacement cost, and the estimated useful life, of the property which the association is obligated to maintain, including but not limited to structural and mechanical components, surfaces of the buildings and common elements, and energy systems and equipment; (ii) the current and anticipated return on investment of association funds; (iii) any independent professional reserve study which the association may obtain; (iv) the financial impact on unit owners, and the market value of the condominium units, of any assessment increase needed to fund reserves; and (v) the ability of the association to obtain financing or refinancing.
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(3) Notwithstanding the provisions of this
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subsection (c), an association without a reserve requirement in its condominium instruments may elect to waive in whole or in part the reserve requirements of this Section by a vote of 2/3 of the total votes of the association. Any association having elected under this paragraph (3) to waive the provisions of subsection (c) may by a vote of 2/3 of the total votes of the association elect to again be governed by the requirements of subsection (c).
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(4) In the event that an association elects to waive
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all or part of the reserve requirements of this Section, that fact must be disclosed after the meeting at which the waiver occurs by the association in the financial statements of the association and, highlighted in bold print, in the response to any request of a prospective purchaser for the information prescribed under Section 22.1; and no member of the board of managers or the managing agent of the association shall be liable, and no cause of action may be brought for damages against these parties, for the lack or inadequacy of reserve funds in the association budget.
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(d) (Blank).
(e) The condominium instruments may provide for the assessment,
in connection with expenditures for the limited common elements, of only those
units to which the limited common elements are assigned.
(f) Payment of any assessment shall be in amounts and at times
determined by the board of managers.
(g) Lien.
(1) If any unit owner shall fail or refuse to make
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any payment of the common expenses or the amount of any unpaid fine when due, the amount thereof together with any interest, late charges, reasonable attorney fees incurred enforcing the covenants of the condominium instruments, rules and regulations of the board of managers, or any applicable statute or ordinance, and costs of collections shall constitute a lien on the interest of the unit owner in the property prior to all other liens and encumbrances, recorded or unrecorded, except only (a) taxes, special assessments and special taxes theretofore or thereafter levied by any political subdivision or municipal corporation of this State and other State or federal taxes which by law are a lien on the interest of the unit owner prior to preexisting recorded encumbrances thereon and (b) encumbrances on the interest of the unit owner recorded prior to the date of such failure or refusal which by law would be a lien thereon prior to subsequently recorded encumbrances. Any action brought to extinguish the lien of the association shall include the association as a party.
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(2) With respect to encumbrances executed prior to
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August 30, 1984 or encumbrances executed subsequent to August 30, 1984 which are neither bonafide first mortgages nor trust deeds and which encumbrances contain a statement of a mailing address in the State of Illinois where notice may be mailed to the encumbrancer thereunder, if and whenever and as often as the manager or board of managers shall send, by United States certified or registered mail, return receipt requested, to any such encumbrancer at the mailing address set forth in the recorded encumbrance a statement of the amounts and due dates of the unpaid common expenses with respect to the encumbered unit, then, unless otherwise provided in the declaration or bylaws, the prior recorded encumbrance shall be subject to the lien of all unpaid common expenses with respect to the unit which become due and payable within a period of 90 days after the date of mailing of each such notice.
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(3) The purchaser of a condominium unit at a
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judicial foreclosure sale, or a mortgagee who receives title to a unit by deed in lieu of foreclosure or judgment by common law strict foreclosure or otherwise takes possession pursuant to court order under the Illinois Mortgage Foreclosure Law, shall have the duty to pay the unit's proportionate share of the common expenses for the unit assessed from and after the first day of the month after the date of the judicial foreclosure sale, delivery of the deed in lieu of foreclosure, entry of a judgment in common law strict foreclosure, or taking of possession pursuant to such court order. Such payment confirms the extinguishment of any lien created pursuant to paragraph (1) or (2) of this subsection (g) by virtue of the failure or refusal of a prior unit owner to make payment of common expenses, where the judicial foreclosure sale has been confirmed by order of the court, a deed in lieu thereof has been accepted by the lender, or a consent judgment has been entered by the court.
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(h) A lien for common expenses shall be in favor of the members of the
board of managers and their successors in office and shall be for the
benefit of all other unit owners. Notice of the lien may be recorded by
the board of managers, or if the developer is the manager or has a majority
of seats on the board of managers and the manager or board of managers
fails to do so, any unit owner may record notice of the lien. Upon the
recording of such notice the lien may be foreclosed by an action brought in
the name of the board of managers in the same manner as a mortgage of real
property.
(i) Unless otherwise provided in the declaration, the members
of the board of managers and their successors in office, acting on behalf
of the other unit owners, shall have the power to bid on the
interest so foreclosed at the foreclosure sale, and to acquire and
hold, lease, mortgage and convey it.
(j) Any encumbrancer may from time to time request in writing a written
statement from the manager or board of managers setting forth the unpaid
common expenses with respect to the unit covered by his encumbrance.
Unless the request is complied with within 20 days, all unpaid common
expenses which become due prior to the date of the making of such request
shall be subordinate to the lien of the encumbrance. Any encumbrancer
holding a lien on a unit may pay any unpaid common expenses payable with
respect to the unit, and upon payment the encumbrancer shall have a lien on
the unit for the amounts paid at the same rank as the lien of his encumbrance.
(k) Nothing in Public Act 83‑1271 is intended to change the lien
priorities of any encumbrance created prior to August 30, 1984.
(Source: P.A. 91‑357, eff. 7‑29‑99.)
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(765 ILCS 605/9.1) (from Ch. 30, par. 309.1)
Sec. 9.1.
(a) Other liens; attachment and satisfaction.
Subsequent to the recording of the declaration, no liens of any nature shall
be created or arise against any portion of the property except against an
individual unit or units. No labor performed or materials furnished with
the consent or at the request of a particular unit owner shall be the basis
for the filing of a mechanics' lien claim against any other unit. If the
performance of the labor or furnishing of the materials is expressly authorized
by the
board of managers, each unit owner shall be deemed to have expressly authorized
it and consented thereto, and shall be liable for the payment of his unit's
proportionate share of any due and payable indebtedness as set forth in this
Section.
Each mortgage and other lien, including mechanics liens, securing a debt
incurred in the development of the land submitted to the provisions of this
Act for the sale of units shall be subject to the provisions of this Act,
subsequent to the conveyance of a unit to the purchaser.
In the event any lien exists against 2 or more units and the indebtedness
secured by such lien is due and payable, the unit owner of any such unit
so affected may remove such unit and the undivided interest in the common
elements appertaining thereto from such lien by payment of the proportional
amount of such indebtedness attributable to such unit. In the event such
lien exists against the units or against the property, the amount of such
proportional payment shall be computed on the basis of the percentages set
forth in the declaration. Upon payment as herein provided, it is the duty
of the encumbrancer to execute and deliver to the unit owner a release of
such unit and the undivided interest in the common elements appertaining
thereto from such lien, except that such proportional payment and release
shall not prevent the encumbrancer from proceeding to enforce his rights
against any unit or interest with respect to which such lien has not been
so paid or released.
The owner of a unit shall not be liable for any claims, damages, or
judgments, including but not limited to State or local government fees or
fines, entered as a result of any action or inaction of the board of managers
of the association other than for mechanics' liens as set forth in this
Section.
Unit owners other than the developer, members of the board of managers other
than the developer or developer representatives, and the association of unit
owners shall not be liable for any claims,
damages, or judgments, including but not limited to State or local government
fees or fines, entered as result of any action or inaction of the developer
other than for mechanics' liens as set forth in this Section.
Each unit owner's liability for any judgment entered against the
board of managers or the association, if any, shall be limited to his
proportionate share of the indebtedness as set forth in this Section, whether
collection is sought through assessment or otherwise. A unit owner shall be
liable for any claim, damage or judgment entered as a result of the use or
operation
of his unit, or caused by his own conduct. Before conveying a unit, a developer
shall record and furnish purchaser releases of all liens affecting
that unit
and its common element interest which the purchaser does not expressly agree
to take subject to or assume, and the developer shall provide a
surety bond
or substitute collateral for or insurance against liens for which a
release is not provided. After conveyance
of such unit, no mechanics lien shall be created against such unit or its
common element interest by reason of any subsequent contract by the developer
to improve or make additions to the property.
Each mortgagee or other lienholder of the unit of a common interest
community or of a unit subject to the Condominium Property Act shall
provide an address to the unit owners' association at the time the lien or
mortgage is recorded at which address such unit owners' association shall send
notice
to such mortgagee or lienholder of any eminent domain
proceeding to which the association thereafter becomes a party. If the
mortgagee or lienholder has not provided an address for notice purposes to
the association, then such notice shall be sent to all
mortgagees or lienholders which are named insureds on the master policy of
insurance which exists or may exist on the common interest community or
unit subject to the Condominium Property Act.
(b) Board of Managers' standing and capacity.
The board of managers shall have standing and capacity to act in a
representative
capacity in relation to matters involving the common elements or more than
one unit, on behalf of the unit owners, as their interests may appear.
(Source: P.A. 91‑616, eff. 8‑19‑99.)
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(765 ILCS 605/12) (from Ch. 30, par. 312)
Sec. 12.
Insurance.
(a) Required coverage. No policy of insurance shall be issued or
delivered to a condominium association, and no policy of insurance issued to a
condominium association shall be renewed, unless the insurance coverage under
the policy includes the following:
(1) Property insurance. Property insurance (i) on |
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the common elements and the units, including the limited common elements and except as otherwise determined by the board of managers, the bare walls, floors, and ceilings of the unit, (ii) providing coverage for special form causes of loss, and (iii) in a total amount of not less than the full insurable replacement cost of the insured property, less deductibles, but including coverage for the increased costs of construction due to building code requirements, at the time the insurance is purchased and at each renewal date.
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(2) General liability insurance. Commercial general
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liability insurance against claims and liabilities arising in connection with the ownership, existence, use, or management of the property in a minimum amount of $1,000,000, or a greater amount deemed sufficient in the judgment of the board, insuring the board, the association, the management agent, and their respective employees and agents and all persons acting as agents. The developer must be included as an additional insured in its capacity as a unit owner, manager, board member, or officer. The unit owners must be included as additional insured parties but only for claims and liabilities arising in connection with the ownership, existence, use, or management of the common elements. The insurance must cover claims of one or more insured parties against other insured parties.
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(3) Fidelity bond; directors and officers coverage.
(A) An association with 6 or more dwelling units
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must obtain and maintain a fidelity bond covering persons, including the managing agent and its employees who control or disburse funds of the association, for the maximum amount of coverage available to protect funds in the custody or control of the association, plus the association reserve fund.
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(B) All management companies that are
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responsible for the funds held or administered by the association must be covered by a fidelity bond for the maximum amount of coverage available to protect those funds. The association has standing to make a loss claim against the bond of the managing agent as a party covered under the bond.
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(C) For purposes of paragraphs (A) and (B), the
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fidelity bond must be in the full amount of association funds and reserves in the custody of the association or the management company.
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(D) The board of directors must obtain directors
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and officers liability coverage at a level deemed reasonable by the board, if not otherwise established by the declaration or bylaws. Directors and officers liability coverage must extend to all contracts and other actions taken by the board in their official capacity as directors and officers, but this coverage shall exclude actions for which the directors are not entitled to indemnification under the General Not For Profit Corporation Act of 1986 or the declaration and bylaws of the association.
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(b) Contiguous units; improvements and betterments. The insurance
maintained under subdivision (a)(1) must include the units, the limited
common elements except as otherwise determined by the board of managers,
and the common elements. The insurance need not cover improvements and
betterments to the units installed by unit owners, but if improvements
and betterments are covered, any increased cost may be assessed by the
association against the units affected.
Common elements include fixtures located within the unfinished
interior surfaces of the perimeter walls, floors, and ceilings of the
individual units initially installed by the developer. Common elements
exclude floor, wall, and ceiling coverings. "Improvements and
betterments" means all decorating, fixtures, and furnishings installed
or added to and located within the boundaries of the unit, including
electrical fixtures, appliances, air conditioning and heating
equipment, water heaters, or built‑in cabinets installed by unit owners.
(c) Deductibles. The board of directors of the association may,
in the case of a claim for damage to a unit or the common elements, (i)
pay the deductible amount as a common expense, (ii) after notice and an
opportunity for a hearing, assess the deductible amount against the
owners who caused the damage or from whose units the damage or cause of
loss originated, or (iii) require the unit owners of the units affected
to pay the deductible amount.
(d) Other coverages. The declaration may require the association
to carry any other insurance, including workers compensation,
employment practices, environmental hazards, and equipment breakdown,
the board of directors considers appropriate to protect the
association, the unit owners, or officers, directors, or agents of the
association.
(e) Insured parties; waiver of subrogation. Insurance policies
carried pursuant to subsections (a) and (b) must include each of the
following provisions:
(1) Each unit owner and secured party is an insured
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person under the policy with respect to liability arising out of the unit owner's interest in the common elements or membership in the association.
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(2) The insurer waives its right to subrogation
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under the policy against any unit owner of the condominium or members of the unit owner's household and against the association and members of the board of directors.
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(3) The unit owner waives his or her right to
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subrogation under the association policy against the association and the board of directors.
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(f) Primary insurance. If at the time of a loss under the policy
there is other insurance in the name of a unit owner covering the same
property covered by the policy, the association's policy is primary
insurance.
(g) Adjustment of losses; distribution of proceeds. Any loss
covered by the property policy under subdivision (a)(1) must be
adjusted by and with the association. The insurance proceeds for that
loss must be payable to the association, or to an insurance trustee
designated by the association for that purpose. The insurance trustee
or the association must hold any insurance proceeds in trust for unit
owners and secured parties as their interests may appear. The proceeds
must be disbursed first for the repair or restoration of the damaged
common elements, the bare walls, ceilings, and floors of the units, and
then to any improvements and betterments the association may insure.
Unit owners are not entitled to receive any portion of the proceeds
unless there is a surplus of proceeds after the common elements and
units have been completely repaired or restored or the association has
been terminated as trustee.
(h) Mandatory unit owner coverage. The board of directors may,
under the declaration and bylaws or by rule, require condominium unit
owners to obtain insurance covering their personal liability and
compensatory (but not consequential) damages to another unit caused by
the negligence of the owner or his or her guests, residents, or invitees,
or regardless of any negligence originating from the unit. The personal
liability of a unit owner or association member must include the
deductible of the owner whose unit was damaged, any damage not covered
by insurance required by this subsection, as well as the decorating,
painting, wall and floor coverings, trim, appliances, equipment, and
other furnishings.
If the unit owner does not purchase or produce evidence of
insurance requested by the board, the directors may purchase the
insurance coverage and charge the premium cost back to the unit owner.
In no event is the board liable to any person either with regard
to its decision not to purchase the insurance, or with regard to the timing of
its purchase of the insurance or the amounts or types of coverages
obtained.
(i) Certificates of insurance. Contractors and vendors (except public
utilities) doing business
with a condominium association under contracts exceeding $10,000 per
year must provide certificates of insurance naming the association, its
board of directors, and its managing agent as additional insured parties.
(j) Non‑residential condominiums. The provisions of this Section
may be varied or waived in the case of a condominium community in which
all units are restricted to nonresidential use.
(k) Settlement of claims. Any insurer defending a liability claim
against a condominium association must notify the association of the
terms of the settlement no less than 10 days before settling the claim.
The association may not veto the settlement unless otherwise provided
by contract or statute.
(Source: P.A. 92‑518, eff. 6‑1‑02.)
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(765 ILCS 605/14) (from Ch. 30, par. 314)
Sec. 14.
Disposition
of property where insurance proceeds are insufficient for reconstruction.)
(1) In case of fire or other disaster, if the insurance proceeds are
insufficient to reconstruct the building and the unit owners and all other
parties in interest do not voluntarily make provision for reconstruction of
the building within 180 days from the date of damage or destruction, the
board of managers may record a notice setting forth such facts and upon the
recording of such notice:
(a) The property shall be deemed to be owned in common by the unit
owners;
(b) The undivided interest in the property owned in common which shall
appertain to each unit owner shall be the percentage of undivided interest
previously owned by such owner in the common elements;
(c) Any liens affecting any of the units shall be deemed to be
transferred in accordance with the existing priorities to the undivided
interest of the unit owner in the property as provided herein; and
(d) The property shall be subject to an action for partition at the suit
of any unit owner, in which event the net proceeds of sale, together with
the net proceeds of the insurance on the property, if any, shall be
considered as one fund and shall be divided among all the unit owners in a
percentage equal to the percentage of undivided interest owned by each
owner in the property, after first paying out of the respective shares of
the unit owners, to the extent sufficient for the purpose, all liens on the
undivided interest in the property owned by each unit owner.
(2) In the case of fire or other disaster in which fewer than
1/2 of the units are rendered uninhabitable: the condominium
instruments may provide for the reconstruction of the building or
other portion of the property, if the insurance proceeds are insufficient
to reconstruct, upon the affirmative vote of not fewer than
3/4 of the owners voting at a meeting called for that purpose. The
meeting shall be held within 30 days following the final adjustment
of insurance claims, if any. Otherwise,
such meeting shall be held within 90 days of the occurrence. At
such meeting the board of managers, or its representative, shall present
to the members present an estimate of the cost of
repair or reconstruction, and the estimated amount of necessary assessments
against each unit owner.
(3) In the case of fire or other disaster, the condominium instruments
may provide for the withdrawal of any portion of the property if the
insurance proceeds are insufficient to reconstruct the portion of the
property affected.
Upon the withdrawal of any unit or portion thereof, the percentage of
interest in the common elements appurtenant to such unit or portion
thereof shall be reallocated among the remaining units on the basis of
the percentage of interest of each remaining unit. If only a portion of
a unit is withdrawn, the percentage of interest appurtenant to that unit
shall be reduced accordingly, upon the basis of diminution in market value
of the unit, as determined by the board of managers. The payment of just
compensation, or the allocation of any insurance, or other proceeds to any
withdrawing or remaining unit
owner shall be on an equitable basis, which need not be a unit's percentage
interest. Any insurance or other proceeds available in connection with
the withdrawal of any portion of the common elements, not necessarily
including the limited common elements, shall be allocated on the basis
of each unit owner's percentage interest therein. The declaration may
provide that proceeds available from the withdrawal of any limited common
element will be distributed in accordance with the interests of those
entitled to their use. The condominium instruments shall provide for
the cessation of responsibility for the payment
of assessments for any unit or portion thereof withdrawn from the condominium.
(Source: P.A. 80‑1117.)
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