Today's severe recession is forcing many of us to make unpleasant choices as to which bills to pay. The mortgage crisis makes such decisions even harder for condominium and town home owners, some of whom have fallen behind in payment of assessments, unfortunately thereby transferring their own financial problems in financial problems for their associations.
An Illinois Condominium Association Board has both a fiduciary and statutory duty to collect all assessments. The Condominium Act does not give the Board discretion to reduce assessments due from a delinquent unit owner, although it can compromise the amount of fines, attorney fees or other collection costs.
Several collection options are available to an Illinois Condominium or Town Home Association. The Association can file a lien, foreclose the lien and eventually force a court ordered sale of a unit. The Association can also seek a personal judgment against an owner, allowing collection from all nonexempt assets or earnings.
The most powerful collection option is the right of an Illinois Condominium or electing Town Home Association to evict the owner from the right to possess the unit. The Association can then rent the unit and use the rent to pay the past due as well as current assessments and the Association's collection costs. This is especially effective in the case of an absentee owner who has rented the unit, as the eviction action need not be served on and can leave the tenant in place and simply terminate in the Association's favor the owner's right to collect the rent.
THE EVICTION PROCESS
Once the Association has decided to pursue eviction with respect to a delinquent unit owner, the Board should adopt a resolution to employ an attorney and begin collection procedures. The first step is to serve the owner with a 30 day Notice and Demand for Possession, meeting the requirements of the Eviction Statute and the federal Fair Debt Collection Practices Act. The Notice is served by personal service or by registered or certified mail, return receipt requested. If properly mailed, the Notice is effective upon mailing and need not even be actually received by the owner. Unless all amounts demanded under a properly prepared Notice are paid in full within the 30 days or the Association or its representative agrees in consideration of partial payment to withdraw the Notice, the Notice continues effective even if partial payments are accepted.
After 30 days have passed without payment in full, an eviction action may be commenced by filing suit in the Circuit Court and servi
TRIAL AND JUDGMENT
If the delinquent unit owner does not contest the proceeding, judgment may be by affidavit, with no Court appearance by the Association or management company. If facts are disputed, a trial will be held to resolve any disputed issues. By statute, enforcement of the eviction judgment must be stayed for at least 60 but no more than 180 days, at the discretion of the court. Once the stay expires, the Association may serve a copy of the judgment on the tenant in the case of a leased unit or in the case of an owner occupant, may employ the sheriff to execute the order to evict the owner. The Association may thereafter collect rent from an existing tenant or lease the unit to a bona fide new tenant, using the rent collected to reduce the amounts determined by the court to be due from the defaulting unit owner and to pay leasing costs and current assessments.
(C) 2008-2009 Law Offices of Barry Kreisler, P.C.
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