REAL ESTATE LAW PRACTICE “KEYPOINTS”
By Steven B. Bashaw
Steven B. Bashaw, P.C.
1301West 22nd Street
Oak Brook, Illinois 60523
Tel.: (630) 472-9990
Fax.: (630) 472-9993
(Copyright 2000 - All Rights Reserved)
1. MORTGAGE LIEN PRIORITY; SUBROGATION REAFFIRMED:
Last month’s Keypoints featured the Second District’s decision in Aames Capital Corporation v. Interstate Bank of Oak Forest, which distinguished Firstmark v. Superior Bank and applied the 1897 case of Homes Savings Bank Bierstadt to give new life into the doctrine of subrogation. Conventional subrogation was used to give a lien priority to a later recorded mortgage to the extent its funds were used to refinance a superior mortgage. Not long after the ink was dry on that decision, the First District filed a decision adding it to the supporters of the application of the doctrine of conventional subrogation in LaSalle Bank v. First American Bank, (1st Dist., September 12, 2000), http://www.state.il.us/court/Opinions/AppellateCourt/2000/1stDistrict/September/Html/1981388.htm.
This case also revolved about a mortgage foreclosure proceeding. LaSalle filed against the holder of legal title, First American Bank, As Trustee u/t/a No. F89-130. The beneficiary of the trust was Brandess Home Builders, which had entered into a contract with Daniel Lopez to build and sell a custom home on the subject property. Lopez paid Brandess $120,033 in earnest money on a contract for a total of $519,042. Brandess then applied to LaSalle for a construction loan of $385,000 to finance the building of the custom home; (the application noted that Lopez had contracted to purchase the completed structure and land). Its land trustee gave LaSalle the mortgage sought to be foreclosed. LaSalle funded $199,400 of the construction financing; $150,000 of which was used to payoff the prior mortgage of Parkway Bank which had been used to purchase the land for development well before either Lopez or LaSalle had any interest in the property. When Brandess stopped construction the building was approximately 50% complete. Brandess defaulted in payments to LaSalle and its subcontractors, resulting in the foreclosure, counterclaims for mechanic’s liens, and Lopez’ counterclaim seeking specific performance and a declaration that his Vendee’s lien for the earnest money was a prior and superior lien to that of LaSalle.
In denying Lopez’ motion for summary judgment, the trial court applied the doctrine of conventional subrogation to find that LaSalle, as subrogee of Parkway had a mortgage lien superior to Lopez. The construction loan agreement and the mortgage both contained an agreement between Brandess and LaSalle that LaSalle’s mortgage was to have a priority over all other liens. Accordingly, LaSalle was conventionally subrogated to the prior lien of Parkway’s mortgage, and defeated Lopez to the extent it paid off Parkway. In affirming the trial court’s award of summary judgment in favor of LaSalle, the First District noted that "Contrary to the assertions of Lopez, the doctrine of conventional subrogation does not require either that LaSalle obtain Lopez’ consent to subordinate Lopez’ purported lien, or that LaSalle obtain an assignment of the Parkway mortgage." The Court also denied any importance to the fact that Parkway released its mortgage, (a distinction that was preserved in the Aames Capital case), and stated that "LaSalle’s knowledge of Lopez’ purchase contract with Brandess is immaterial to the application of the doctrine of conventional subrogation." Instead, Justice McBride’s decision emphasizes that Lopez gave Brandess his earnest money knowing that Parkway had a superior mortgage lien, and takes the position that Lopez is left in the same position that he was when he first contracted by virtue of the application of the doctrine of conventional subrogation; "In such a case, the doctrine may be applied."
The Court’s decision also rejected Lopez’ argument based on the doctrine of equitable conversion. Noting that the contract with Lopez was entered into by Brandess (the beneficiary of the land trust) rather than the legal title owner (First American Bank), McBride states "The doctrine of equitable conversion has traditionally been applied where there was a contract between and owner and a purchaser. Thus, Lopez, in essence, asks us to expand the doctrine to include holders of a beneficial interest in a land trust. This we decline to do."
In a somewhat confusing turn of the tale, the Court then rejects Lopez’ argument that LaSalle’s lien should be limited to the principal payment it made to Parkway under conventional subrogation, (i.e., $150,000 rather than the $220,000 awarded in the trial court, which included interest, late charges, attorney’s fees and costs), based on the fact that it need not apply the doctrine of conventional subrogation at all. (huh??) Disregarding the lengthy discussion of the doctrine of conventional subrogation, the previous statement that "We thus find that the trial court properly applied the doctrine of conventional subrogation", and highlighting that the trial court failed to determine if Lopez had a vendee’s lien, the decision states "Where Lopez had no lien, LaSalle did not even need to rely on the equitable doctrine of conventional subrogation to gain priority over Lopez…The trial court did not err in granting LaSalle its contractual attorney’s fees, costs, late charges and interest."
(huh? "equitable doctrine of conventional subrogation"?? Or conventional doctrine of equitable subrogation??? lien or no lien?? This certainly seems to be a circuitous position, and one that creates enough confusion to suggest the Supreme Court ought step in to clarify some issues relating to releases and the extent of the subrogation in this area; or even bring a halt to the application of the doctrine before it gets totally out of hand and supplants "first in time" entirely.)
(Ed. Note: A petition for leave to appeal has been filed with the Supreme Court in the Aames Capital case according to Claudia Graham at Chicago Title, and we may just see the opportunity taken.)
2. REAL ESTATE CONTRACTS: MERGER BY DEED:
In a fact pattern we have seen before, the Buyer brought suit against the Seller in Neppl v. Murphy, (1st Dist., September 22, 2000), http://www.state.il.us/court/Opinions/AppellateCourt/2000/1stDistrict/September/Html/1000742.htm for breach of an express warranty contained in a contract for the sale of residential real estate when the heating system failed to perform and was "red tagged" immediately after the closing.
The contract specifically provided that the Seller warranted that "all fixtures, systems and personal property …shall be in operating condition at possession…[and] shall be in operating condition if it performs the function for which it is intended regardless of age, and does not constitute a threat to health or safety". The Defendant/Sellers brought a motion in the Circuit Court of Cook County before Judge Laurie to dismiss pursuant to Section 2-615 and 2-619, and the complaint was dismissed based on a finding that, under the doctrine of merger, the warrantys expressed in the contract were merged into the deed.
During the inspection stage of contract, Buyer’s raised the fact that the furnace had a cracked heat exchanger, and the Sellers replaced it. Their inspector also recommended that a safety inspection be performed by the gas company. People’s Gas inspected the furnace on the day of the transfer of possession as the gas service was transferred to Buyers, and "red tagged" the furnace as a safety hazard because the venting and access were not incompliance with the City of Chicago building code and People’s Gas requirements.
In reversing the trial court, the First District begins by noting that an exception to the doctrine of merger, (i.e., that the deed supersedes all of the contract provisions and any warrantees not restated in the deed are merged or extinguished by the deed), occurs when the contract contains warrantees that are not fulfilled by the deliver of the deed, but relates to "collateral undertaking"; i.e., matters not germane to the conveyance and therefore excepted from the doctrine. Beginning with Rouse v. Brooks, (1978) 66 Ill.App.3d 107, 383 N.E.2d 666, (which first excepted the express quality warranty of a builder/vendor from the doctrine of merger since the delivery of the deed did not constitute performance of that covenant) and including the recent cases of Lanterman v. Edwards and Krajcir v. Egidi, (which were highlighted in previous Keypoints, May, 1998 and July, 1999), the Court that "the threshold issue in any case involving the merger doctrine as a defense is whether the contractual provision at issue is collateral to an independent of the provisions in the subsequent deed; if so there is no merger." The decision takes on the attempts of the defendant to distinguish Lanterman on the facts, dismisses the dissent in Lanterman, and concludes with an unequivocal statement that "the defendants’ express warranty in the contract as to the quality of , among other things, the heating system is a collateral undertaking not fulfilled by the delivery of the deed…Plaintiffs’ complaint is not barred by the merger doctrine and should not have been dismissed."
3. REAL ESTATE SERVICE CONTRACTS AND UNDISCLOSED OR PARTIALLY DISCLOSED PRINCIPAL; LIABILITY OF THE AGENT:
It is common for limited partnerships to own commercial buildings and hire management companies to conduct the day-to-day business of running the building, including janitorial services. It is also common knowledge that the management agent will be personally liable to the third party service provider unless it has disclosed that there is an owner for whom the agent is conducting the business. An case illustrative of this principle, as well as how important it is to actually disclose the principal’s identity, (and how difficult it can be to prove disclosure), is Kimco Corp. v. Murdoch, Coll, and Lillibridge, Inc., (1st Dist., May 23, 2000), http://www.state.il.us/court/Opinions/AppellateCourt/2000/1stDistrict/May/HTML/1984579.htm, Kimco was to provide janitorial services on a month to month basis according to its agreement with Murdoch at the Fisher Building in downtown Chicago. When payment became a problem, Kimco met with Murdoch employees, who disclosed they were managing the building for a principal, and Kimco was advised that the building owner was a limited partnership. Murdoch told Kimco that the owner was having financial difficulties, refused to invest any more capital in the building, and was attempting to refinance. As a result, the owner would only pay for services after they were rendered rather than in advance; as was Kimco’s ordinary billing practice. While it was agreed that Murdoch disclosed it was acting for a principal, parties disputed whether Kimco was actually advised of the identity of the partnership; (which might be somewhat confusing since the owner of the Fisher Building was the Fisher Building Limited Partnership). The trial court granted summary judgment in favor of Kimco on the issue of Murdoch’s liability for the janitorial fees incurred after the meeting, holding that Murdoch had not disclosed the identity of principal at the time of the meeting.
In reversing the trial court, Justice Cousins begins with the distinction between a partially disclosed and undisclosed principal; when the principal’s identity is not known, although it is disclosed that the agent is contracting on behalf of a principal, the resulting partial disclosure will not relieve the agent of personal liability. An agent who contracts on behalf of an undisclosed or only partially disclosed principal is personally liable on the contract because the third party is obviously relying on the credit of the agent and not that of the unknown principal. In order to avoid liability, Murdoch would have had to have disclosed that it was acting for the "Fisher Building Limited Partnership" and not merely that it was acting as an agent for "the Fisher Building".
Murdoch, citing cases from North Carolina and Kentucky, urged the Court to adopt as an exception to this rule the circumstance where, while in the course of an executory, divisible contract (remember this is a month-to-month janitorial contract), the existence of an undisclosed principal becomes known and the third party nonetheless continues to perform. "If a third party…discovers the agency…while a continuing, divisible contract…is still executory, he then has the option to deal either with the agent or the principal…[and]…the agent…is not liable if the third party continues…" Noting that this appears to be a question of first impression in Illinois, the decision reverses the trial court on remand stating that "But as no authority from any jurisdiction has been cited rejecting the exception, we recognize it on the strength of the cases from other states." In order to reverse, the Court determines that the month-to-month contract is a "divisible" not "entire" contract, "analogous to a monthly employment contract.", and also appears to have adopted the exception applied divisible contracts.
On remand, the trial court will have to determine who actually told exactly what to whom and how and whether to apply the exception to the rule of partially disclosed agency.
4. SPECIAL ASSESSMENTS; OBJECTION TO COMPUTATION:
Special Assessments, (taxes collected for improvements which benefit specific parcels of real estate), are somewhat confusing, both in their inception and collection. In re County of Kankakee Special Assessment for Improving Riverside Country Estates, (3rd Dist., August 31, 2000), http://www.state.il.us/court/Opinions/AppellateCourt/2000/3rdDistrict/August/HTML/3990710.htm, is a case which offers some insight into the creation and calculation of the sums due for the improvements to be paid for by a special assessment. The case also presents some interesting arguments and ruling on statutory interpretation.
Property owners from four Kankakee County subdivisions petitioned the Kankakee County Committee for Local Improvements for the extension of water service when their wells became contaminated and redrilling failed. The petition came under the Local Improvements Act, (55 ILCS 5/5-32001, et seq.), which requires that the work is financed through a special assessment, and provides the method for the calculation of the total amount due. When this project was complete, the County filed its certificate of final costs, which included charges for time expended by county employees in preparing the special assessment. One of the property owners, Thomas McClure, filed and objection, arguing that the County was not entitled to be reimbursed for the costs of the use of salaried county employees. Section 32059 of the Land Improvements Act provides that 6% of the total cost and expenses for the improvement can include the salaries of the members of the Committee, but does not make any mention of salaries of regular county employees who work on the project. The Court agreed with the trial court and Mr. McClure and rejected the County’s argument that it should be allowed to include the employee salaries. Turning first to rules of legislative interpretation, the decision then incorporates supporting argument based on the fact that it would be impractical to attempt to identify the percentage of the employee’s time spend on this particular project, and notes that in the end the water main extension will increase the property values in the subdivisions, and this will result in increased tax revenues that will benefit the public as a whole. Accordingly, the County need not be directly compensated by the special assessment. While the County asked the Court to reverse the trial court on public policy grounds that counties will be less inclined to approve special assessments in the future, (or outsource the work to private contractors), if they cannot recoup the costs, the Court rejected this justification, noting that while the consideration may be true, "it is not the role of the judiciary to rewrite the legislative enactments."
5. ZONING; NON-COMFORMING USE, ABANDONMENT AND EXPANSION:
An 11 acre parcel of land located in the Village of Plainfield was the subject of a Village complaint against the owner to cease the use of its property for cedar fence manufacturing in Village of Plainfield v. American Cedar Designs, Inc., (3rd Dist., September 12, 2000), http://www.state.il.us/court/Opinions/AppellateCourt/2000/3rdDistrict/_NotRel/Html/3990305.htm, American purchased the property after it had been used for eleven years as a pallet-making site. There was a period of just over one year prior to the purchase when the prior owner had ceased making pallets on the property. The property was in an area zoned for residential use, but the pallet manufacturing was a prior non-conforming use. After American had been manufacturing fences for six years, the DuPage River flooded and carried off bundles of its fencing, which floated as far as five miles down river. Thereafter, the Village filed its complaint against American for violation of the Village’s flood control ordinance, asserted that the nonconforming use had been expanded in violation of the zoning ordinance, and alleging that the use constituted a nuisance. The trial court determined that the non-conforming use had been "grandfathered" and was unable to determine if there was an actual expansion of the use.
The Third District decision affirms in part and reverses in part, offering a bit of good language on non-conforming use, abandonment and expansion. Holding that a legal non-conforming use is a nonpermitted use under a current zoning ordinance which predates the ordinance and is thus legal nonetheless, the Court affirms that an ordinance is invalid if it unreasonably or arbitrarily deprives an owner of his property right to a non-conforming use. The Village’s flood control ordinance did not prohibit the continuation of a prior nonconforming use, and therefore did not assist the Village in its efforts against American. Although there was a discontinuance of the prior owner’s use for a period of just over a year, this did not constitute an "abandonment" of the non-conforming use. An abandonment must be the result of a voluntary intention to abandon the use, and not a mere cessation of the use, in order to prohibit reestablishment. There must be evidence of voluntary conduct which indicates the owner intended to abandon the nonconforming use. There was no evidence that the prior owner intended to abandon the use; only that he stopped manufacturing pallets in anticipation of selling the property. American lost on the issue of expansion, however, based on aerial photographs over a five year period showing a progressive enlargement of storage of materials well beyond the boundaries of the prior use, and the Court ruled that the trial court’s ruling otherwise was contrary to the manifest weight of the evidence.
6. REAL ESTATE TRANSFER DECLARATION FORM UPDATED AND AVAILABLE ON-LINE…REALLY.
A memo from the Illinois Department of Revenue dated August 21, 2000, announces some updating and changes in the Illinois Real Estate Transfer Declaration form, along with an explanation of those changes, which should be of assistance to most. First, the changes are described as "minor changes…based on feedback received from recorders, clerks, assessors and preparers"; so there is no need to be unduly concerned.
The memo begins by stating that the Department’s website, https://www.revenue.state.il.us/RETD/ is now on-line and the transfer declaration form can be prepared electronically…and…amazingly, it worked great(!). I was able to get on-line, fill-in the blanks and print the Transfer Declaration from local printer! (The only "tricky part" is to remember to click on the printer icon that is located within the frame holding the form and not on the printer icon for your communications software…and, you will find it works best if you have Adobe Acrobat Reader installed on your computer.) My paralegal really likes this better than strolling over to the form file and using a typewriter. There are a few limitations, (the exemption drop-down list does not have a category for a deed-in-lieu of foreclosure exemption , for example), but the data entry is clear and easy to navigate.
The updates to the form changes the language relating to "advertising" to add "or sold using a real estate agent" to clarify the intent to gather information on marketing through a Realtor as well as display advertisement. The word "installment" is added between "Fulfillment of " and "contract" to clarify that the transaction is only related to installments over time and not ordinary, executory contracts. The instructions emphasize that the square footage of a condominium should be set forth and clarifies directions for identification of a mineral rights transfer, exchange transactions, mobile home, and personal property itemizations.
This is truly the "dawn of a new day"; both for ease of preparation of the form on-line, and as an example of responsiveness from the State to problems with the form.
(Thanks to John O’Brien of IRELA for initially obtaining and disseminating this information.)
7. LEGAL DISCRIPTIONS FROM THE TITLE COMPANY PERSPECTIVE; MARLOW v. MALONE CONSIDERED:
FROM THE TITLE COMPANY PERSPECTIVE
As a self-professed legal description and survey junkie, I must admit that I probably read last month's Marlow v. Malone decision with more interest than Steve did. Generally speaking, a legal description that monuments to a physical object as a boundary implies monumentation to the middle or central point of that object, unless a contrary intent is shown. Thus, a conveyance of land "bounded by Salt Creek" includes title to the center of the creek, unless the record evidences a contrary intent. See Carter Oil v. Delworth, 120 F.2d 589 (1941); Helmer v. Castle, 109 Ill. 664 (1884), Kinrella v. Stephenson, 265 Ill. 369 (1914); Thompson v. Maloney, 199 Ill. 276 (1902); Albany Railroad Bridge Co. v. People ex rel. Matthews, 197 Ill. 199 (1902); People ex rel Deneen v. Economy Light & Power Co., 241 Ill. 290 (1909).
Consequently, it has been said that a conveyance of land bounded by a railroad right-of-way conveys with it the grantor's title to the center line of the right-of-way, unless a contrary intent appears. See 136 A.L.R. 296. But it appears that this issue has not been adjudicated in Illinois. Thus, a conveyance of land bounded by a railroad right-of-way would convey title only to the edge of the right-of-way. And that was the opinion expressed by the court in the Malone case, where the court noted in dictum that a deed conveying "that part of the southwest quarter of the southwest quarter of section 26, lying west of the Illinois Central Railroad right-of-way" meant that the "plaintiffs received only the land lying west of the ICGR right-of-way."
Which brings me to the topic of legal descriptions. This is an area of paramount importance to title insurers, surveyors, and real estate attorneys, but one that seems to be getting less and less attention. Dozens of them cross my desk every month, and many of them are drafted in a manner that can only be described as horrendous. So consider October to be "Legal Description Awareness Month."
Example: you have lot one; the plat of subdivision indicates that the lot is one hundred feet square. If the first conveyance is of the north 50 feet, then the conveyance of the balance should be described as: "lot 1 (except the north 50 feet thereof.") It should not be described as "the south 50 feet," because in the event the east and west dimensions of lot 1 were actually more than or less than one hundred feet long, there would be, respectively, a gap or an overlap between the two parcels. If the first conveyance is "the north half" of the lot, the balance can be conveyed as "the south half." But again, for the same reason mentioned above, the balance should not be conveyed as "the south 50 feet." It's a simple matter to carve out the "west twenty feet" of a lot when the lot is a square or rectangle. But what if the lot in question is irregular in shape--for example, a parallelogram, with the east and west sides straight up and down, but the north and south sides angling from the northwest to the southeast. The general rule of construction is that unless otherwise qualified, such a deed should be construed as if the westerly portion of the lot were measured by a line drawn at right angles to the westerly line of said lot. But I have always felt that one should not have to resort to a rule of construction in order to understand a legal description. All parties would be better served if the drafter of the legal description made it clear as to how the west twenty feet were measured. There are two choices here: "The west twenty feet of the lot, as measured by a line drawn at right angles to the west line thereof," or "the west twenty feet, as measured by a line drawn parallel to the northerly line thereof."
"Exception" legal descriptions can be especially tricky. The general rule is: Give the entire legal description, or caption, first, and then give any and all exceptions. If you put the exception in the caption, it can be confusing. For example: The west 400 feet of Lot 2 (except the west 100 feet thereof). This is the correct way to describe the land. Here, the entire parcel is first described--in this case, the west 400 feet of lot 2--and then the exception parcel is noted. By writing it this way, it is easy to first identify the west 400 feet of lot 2 and then eliminate the exception parcel (the west 100 feet of the west 400 feet).
But instead the title examiner writes, "the west 400 feet except the west 100 feet of Lot 2." Here, you don't know whether the "west 400 feet" is to be carved out before or after the "west 100 feet" is eliminated. But by writing it this way, it does appear that the west 100 feet of lot 2 is to be carved out first, and then the west 400 feet is taken out of the remainder of lot 2. But this may be contrary to the intent of the parties. In the first example, it was clear that the west 400 feet was identified first, and then, 100 feet was excepted out from this parcel of land. Now, it appears that the west 100 feet was first excepted out from Lot 2, and then the west 400 feet was carved out of the balance of lot 2.
Because exception legals can be confusing, some surveyors might describe the property like so: "That portion of the west 400 feet of Lot 2 lying east of the following described line: Beginning at a point on the north line of lot 2, a distance of 100 feet east of the northwest corner of said lot, thence south parallel to the west line of lot 2 to the southerly line thereof."
Here is another example: "The north 100 feet of the southwest quarter of section 1, except the north 33 feet thereof, falling in Sullivan Road." Here it is clear that you measure first the north one hundred feet and then except out that portion falling in the road. But if you put the exception in the caption, it can be confusing: "The north 100 feet, except the north 33 feet thereof, falling in Sullivan Road, of the southwest quarter of section 1." In this example, do you first measure out the north 100 feet, and then eliminate the north 33 feet, or do you first take out the north 33 feet, and then measure from the south line of the road a strip of land that is 100 feet wide?
Even very simple legal descriptions can cause problems: "Lot 40 and lot 41, except the south twenty feet thereof." Here is the problem: does the exception, "except the south twenty feet thereof," refer to both lots 40 and 41 or only lot 41? The description seems unclear. It was also unclear to the examiner, and resulted in a somewhat significant title insurance claim. The legal could have been clarified in at least two ways: "Lot 41 (except the south twenty feet thereof) and lot 40," or "lot 40 and lot 41 (except the south twenty feet of lot 41)"
Now consider this description: "the east 15 feet of lot 9, lot 10, and the west half of lot 11." Does this description describe only the east 15 feet of lot 9, or does it describe the east 15 feet of lot 9 and also the east 15 feet of lot 10? Again, this can be clarified in at least two ways: "lot 10, the east 15 feet of lot 9, and the west half of lot 11," or "the east 15 feet of lot 9, all of lot 10, and the west half of lot 11."
What is wrong with the following legal description? "Beginning at the southwest corner of lot 1; thence north along the west line of said lot 1, 10.50 feet. . . ." You should never allow a legal description to have section numbers or lot numbers directly adjacent to distances. Here, all it will take is the careless deletion of a comma to have the legal description read: ". . . thence north along the west line of said lot 110.50 feet. . . ." It is better to insert the words "a distance of" to separate the lot or section numbers and distances: "thence north along the west line of said lot 1 a distance of 10.50 feet. . . ."
A metes and bounds legal description can have elements that may conflict with each other. Illinois case law has devised a hierarchy, whereby some elements are given more weight than others. From highest weight to lowest weight, this hierarchy is: monuments, courses, distances, and quantity. See Cottingham v. Parr, 93 Ill. 233 (1879); Hadie v. Erlandson, 41 Ill.App.2d 328 (1963); Forest Preserve Dist. Of Cook County v. Lehmann Estate, 388 Ill. 416 (1945). Thus, quantity is given the lowest weight. While a conveyance of "the west five acres" of a section or a square or rectangular lot is probably insurable, title insurers will very likely balk if the parcel to be divided is irregular in shape, since the identification of the division line is too uncertain. The legal description forms the heart and soul of what we do. A description should be written with clarity and with precision. If it isn't, then the practitioner is forced to guess at what the intent of the parties was, which is always a risky proposition.
Dick Bales, Chicago Title Insurance Company, Wheaton
8. LAWYERS AND TITLE COMPANIES WORKING TOGETHER:
As you may already know, Chicago Title is presenting a real estate update seminar, on October 5, 2000, beginning at 1:30 pm, at the Arrowhead Country Club in Wheaton, Illinois. (The seminar is free of charge, but a telephone call to CT&T’s Wheaton office to pre-register was requested.)
The line-up of speakers alone makes the program worth while, but as an additional incentive, John O’Brien of IRELA advises me that CT&T has graciously agreed to give him a few moments between presentations to update the audience on the status of IRELA’s lawsuit against Koenig & Strey for the unauthorized practice of law and other issues that are of importance to real estate practitioners. If you have been looking for an opportunity to support IRELA’s efforts, this certainly will let you "hit two birds with one stone"; (you can update your practice skills and make a donation to IRELA’s efforts if so moved).
What is perhaps most remarkable is the support that CT&T is giving to this cause. I have heard John O’Brien speak in the past about the extraordinary response IRELA has received from the individual attorneys who do "closings" and whose cause they are advancing. In recent weeks the Illinois State Bar Association leadership has added the support of the state bar association to the effort. Now, it seems that even segments the industry that both serves and, (according to some), competes with attorneys to provide title insurance in transactions are responding to the call to keep lawyers vital and practicing in this area. If you have the time, this will be a good opportunity to hear not only about the cutting edge case law and practice tips, but to also hear first hand what challenges are facing transactional lawyers and how they are responding.
9. THE FUTURE OF LAWYERS IN RESIDENTIAL REAL ESTATE TRANSACTIONS PANEL DISCUSSION:
On November 2, 2000 and November 10, 2000, the ISBA Real Estate Section Council’s annual Real Estate Law Update program will be offered in Bloomington/Normal and Chicago. This year the program will include a panel discussion entitled the "The Future of Lawyers in Residential Real Estate Transactions". The panel will include speakers who not only have a good deal to say about real estate transactional practice and a commitment to attorneys and their clients, but also are in positions from which to make an impact on the future. Among the panelists will be Tim Eaton, ISBA First Vice-President, who will lead the Illinois State Bar Association in the coming year and set its goals and priorities. Historically, the ISBA has been more attune to the practices of litigators, but with current President Herb Frank’s vow to focus on the unauthorized, the role of the ISBA and a focus on real estate seems certain in the future. Peter Birnbaum, ATGF President, whose commitment to lawyers and the "fund concept" is well known and will also contribute to the discussion. Peter has been a member of the Committee on the Unauthorized Practice of Law and has a view that extends over a number of years and developments. No panel on this topic would be complete without John O’Brien, President of IRELA, which has lead the charge against Koenig & Strey and keeps its members informed on these issues on an almost daily basis. John will certainly have something to say about the place of attorneys in residential transactions in the future. In addition to unauthorized practice issues, this discussion is impacted the multi-disciplinary practice movement, the efforts of some Realtors to exclude private attorneys from active participation in transactions, and there certainly should be some discussion of the "realities" and "practicalities" of the business of practicing law in residential transactions. Attorneys in other states have abandoned residential transactions. Illinois attorneys are on the verge of deciding differently and making that decision stand or letting the decision be made for them. Regardless of which way the decision goes, the impact on attorneys, buyers, sellers, consumers, title companies, Realtors, and the public at large is going to be dramatic. If at all possible, please consider attending because this panel will encourage comments and participation from the attendees.
10. THE ELECTRONIC BUSINESS OF THE PRACTICE OF LAW:
And, while we are on the topic of government and the internet….The Circuit Courts continue to move closer to electronic communications every day. On September 7, 2000, the Chicago Daily Law Bulletin article entitled "19th Circuit’s Web site becoming a hit" highlighted the fact that the Lake/McHenry County website was developed and maintained in-house has celebrated its one year anniversary in serving the community. In addition to directions to the courthouse, judicial and staff information and court services, the site also contents include court schedules, (holidays and jury calendar, not individual or case management data), and the local circuit rules. Lake and McHenry Counties are not the only Illinois circuits on the web. Cook County Circuit Court (http://www.cookcountycourt.org) guides users through the court rules, offers information on the jury process, and has some useful publications. DuPage County (http://www.dupageco.org) has a limited page within the County’s site. You get there by clicking on the photo of the judicial center, and can get to the Clerk’s page that appears to offer a lot of interaction with headings for printed forms, availability of files and case volumes, but actually only leads to statements of the availability of these services, not access to data. Will County (http://www.willcountycircuitcourt.com) has a site which has some good forms as well as the standard information and publications, but adds useful stuff like the phone number for the motion desk, and a hard to read but much more comprehensive fee schedule than most.
Surely the time will come when we can look up the status of a case, check answers and appearances, and schedule a motion on line, right? Pretty soon, huh?