Real Estate Law

Property Tax Sales and Bankruptcy after Alexandrov v. LaMont

By Andrew J. Hawes
July
2014
Article
, Page 346
The seventh circuit recently held that a homeowner debtor can extend the deadline to redeem property sold at a tax sale by declaring Chapter 13 bankruptcy. Find out what it means.

Financial Freedom Acquisition, LLC v. Standard Bank and Trust Company

Illinois Appellate Court
Civil Court
Mortgage Foreclosure
Citation
Case Number: 
2014 IL App (1st) 120982
Decision Date: 
Friday, June 13, 2014
District: 
1st Dist.
Division/County: 
Cook Co., 6th Div.
Holding: 
Affirmed.
Justice: 
REYES
Plaintiff filed mortgage foreclosure action, for adjustable rate home equity conversion martgage, which was a type of reverse mortgage insured by HUD, against bank, and bank filed counterclaim against Plaintiff alleging violations of Truth in Lending Act (TILA), seeking damages and rescission of loan transaction. Court properly dismissed counterclaim with prejudice. Bank is not entitled to rescission of loan transaction because it is not an obligor, as bank executed exculpatory clause expressly disclaiming any obligation under the note. TILA provides right of rescission only to the obligor of consumer credit transaction. (LAMPKIN, concurring; GORDON, dissenting.)

Goldberg v. 401 North Wabash Venture LLC

Federal 7th Circuit Court
Civil Court
Condominiums
Citation
Case Number: 
No. 13-3057
Decision Date: 
June 10, 2014
Federal District: 
N.D. Ill., E. Div.
Holding: 
Affirmed
Record contained sufficient evidence to support jury’s verdict in favor of defendant in action under Ill. Consumer Fraud and Deceptive Business Practices Act, where plaintiff-owner of condominium units alleged that defendants-sellers of said units improperly used “bait and switch” tactic to convince plaintiff to purchase said units by promising plaintiff certain access to hotel facilities in condominium building and then subsequently taking away plaintiff’s use of said facilities pursuant to “change clause” contained in purchase agreement and other condominium documents. Defendant presented plausible evidence explaining that instant change was based on defendant’s hiring of new employee, who believed that plaintiff and others might mismanage said hotel facilities. Moreover, plaintiff could not establish viable breach of contract action where applicable terms of purchasing agreement allowed defendant make instant change, and where any implied duty of good faith could not modify express terms of agreement. Also, plaintiff could not establish viable claim under Ill. Securities Law, where instant agreement involving purchase of condominium did not constitute “investment contract”/security under Ill. law.

Metropolitan Water Reclamation District of Greater Chicago v. Terra Foundation for American Art

Illinois Appellate Court
Civil Court
Easements
Citation
Case Number: 
2014 IL App (1st) 130307
Decision Date: 
Monday, June 9, 2014
District: 
1st Dist.
Division/County: 
Cook Co.,1st Div.
Holding: 
Affirmed as modified.
Justice: 
HOFFMAN
Plaintiff, a municipal corporation, blocked access to alley to which defendant companies, which had purchased adjacent property to develop, had recorded easements. Claim of intentional interference with easement, for which tort damages (including economic losses) are allowed, seeks to protect possessors of real property against unreasonable interference with their rights to access and use their property. District had duty not to interfere with company's use of easement. Company presented evidence of consequential damages, including costs incurred due to District's interference with its right to use easement, including increased interest obligations and rent payments.(CUNNINGHAM and DELORT, concurring.)

Palm v. 2800 Lake Shore Drive Condominium Association

Illinois Appellate Court
Civil Court
Condominium Law
Citation
Case Number: 
2014 IL App (1st) 111290
Decision Date: 
Friday, May 2, 2014
District: 
1st Dist.
Division/County: 
Cook Co., 5th Div.
Holding: 
Affirmed.
Justice: 
PALMER
(Court opinion corrected 6/6/14.) Plaintiff, a condo unit owner, filed for declaratory and injunctive relief against condo association and its directors. As there is no conflict between declaration and bylaws or other condominium instruments, Section 4.1(b) of Condominium Property Act does not apply, and notice provision in declaration stands. Court properly ruled that Board breached its fiduciary duty by using operating fund to pay reserve expenses and reimbursing operating fund from reserve fund. Court properly found that business judgment rule did not protect Defendants from breach of fiduciary duty in transferring surplus association income to association's reserve account instead of crediting it against unit owners' future assessments. (McBRIDE, concurring; GORDON, specially concurring.)

Senate Bill 3286

Topic: 
Service of process
(Jacobs, D-Moline; Verschoore, D-Rock Island) amends the Code of Civil Procedure to require an employee of a “gated residential community” to grant entry into the community to an authorized process server who is attempting to serve process on a defendant or witness who resides within or is known to be within the community. This access would include common areas and common elements. The term “gated residential community” includes condominium associations, housing cooperatives, or private communities. Passed both chambers.

Senate Bill 1048

Topic: 
Presumptively void transfers in probate
(Silverstein, D-Chicago; Welch, D-Westchester) creates a civil action in the Probate Act if a “presumptively void transfer” is challenged that applies to “caregivers.” If a “transfer instrument” transfers property in excess of $20,0000 to a caregiver and is challenged, it creates a rebuttable presumption that this transfer is void. A caregiver is defined as anyone who has assumed responsibility for all or a portion of the care of another person who needs assistance with daily living activities. A caregiver doesn’t include a “family member” of the person receiving assistance. There are two exceptions to this rebuttable presumption. (1) If the transferee’s share under the transfer instrument is not greater than the share of the transferee was entitled to under the transferor’s testamentary plan in effect before the transferee became a caregiver. (2) If the transfer was not the product of fraud, duress, or undue influence as proved by clear and convincing evidence. If the caregiver attempts and fails to overcome the presumption, the caregiver must bear the cost of the proceedings, including reasonable attorney’s fees. The statute of limitation for challenging a presumptively void transfer is two years unless the Probate Act requires a shorter period. Senate Bill 1048 applies only transfer instruments executed after January 1, 2015. Passed both chambers.

House Bill 4783

Topic: 
Condominium Property Act
(E. Chris Welch, D-Westchester; Steans, D-Chicago) makes the following declarations unenforceable as against public policy if the declarations affect the common elements or more than one unit and require any of the following before the board can take legal action on behalf of the association: (1) consent of a percentage of unit owners, (2) arbitration, (3) mediation before an action may be filed in court, or (4) a restriction or delay in the board’s ability to bring an action affecting the common elements or more than one unit. An otherwise unenforceable provision may be enforced after the election of the first-unit owner board of managers if it is approved by a unit-owner percentage vote of not less than 75% of the total in the aggregate of the undivided ownership of the common elements.