(June, 2003)


By Steven B. Bashaw

Steven B.  Bashaw, P.C.

Suite 1012

1301West 22nd Street

Oak Brook, Illinois  60523

Tel.: (630) 472-9990

Fax.: (630) 472-9993


(Copyright 2003 - All Rights Reserved)

In addition to encouragement from the Illinois Institute of Continuing Legal Education and the Illinois State Bar Association’s Real Estate Section Council,  it should be noted that Chicago Title Insurance Company helps underwrite the monthly production of these real estate law “Keypoints”. Chicago Title is committed to the role of attorneys in real estate transactions and their continuing education in this area.  Its staff attorneys are pleased to offer their view points on various developments in the law as set forth below from the perspective of a title company serving the public and the attorneys who represent their clients in real estate transactions.

(Ed.'s Note: The first three case notes this month deal with the same general issue of whether a zoning hearing is conducted as an 'administrative' or 'legislative' function for the purpose of review. While ordinarily case notes are presented chronologically as the decisions are rendered, Klaeren and Gallik were not presented earlier. They are presented together now with the Oak Grove Jubilee case, and followed by reference to a recent ISBA Section Newsletter article, as an overview of the recent, related developments in this important area of the law. It is noteworthy that the first two of these cases were actually decided last year, and their inclusion here for the first time is compelled (and rewarded!) by the recent rendering of the Oak Grove case as completing the 'trilogy'.)



The first time People ex rel. Klaeren v. Village of Lisle was reported in these "Keypoints" was the occasion of the Second District ruling in October, 2000, 316 Ill.App.3d 770, 316 Ill.App.3d 770, 737 N.E.2d 1099, 737 N.E.2d 1099, 250 Ill.Dec. 122. At that time, the Second District found that the zoning board "hearing" was procedurally defective because in limiting the neighbors rights to speak, ("…this is a public hearing. It is not a debate. There will be no attempt at tonight's hearing to answer any question raised by the audience…To be fair to everyone in the audience, I ask that you limit your comments to two minutes each…"), the Village Officials denied procedural due process because there was no opportunity to cross-examine the representatives of the applicant, Meijer stores, relating to the proposed development in order to bring out the facts and impact of the development on the community to the boards. The Second District's decision opened a 'Pandora's box' in holding that the participants were entitled to procedural due process in a hearing that was essentially 'legislative' rather 'administrative' in nature… or was it? The Illinois Supreme Court examined the issues in this 'Pandora's box' in its opinion two years later, People ex rel. Klaeren v. Village of Lisle, (Oct. 18, 2002),, 202 Ill.2d 164, and in the process of affirming the Second District decision that the neighbors were entitled to due process in the 'hearing', reversed the established body of law in Illinois that a zoning hearing is a "legislative" process. In finding that a legislative body, (i.e., a village board), acts "administratively" when it rules on applications for special use permits and zoning appeals, the rule that this was an "administrative' rather than "legislative" process is important because the due process rights of a participant in an administrative hearing are protectable; whereas the legislative process does not afford a participant the same due process rights. Accordingly, the homeowners in Klaeren had a right to procedural due process in an administrative arena, and the limitations imposed by the Village of Lisle rendered that process defective. "[W]hen a local legislative body no longer crafts rules of general application but instead acts to grant permits, make special exceptions, or decide particular cases, it functions less like a legislative body and its actions are better described as administrative, quasi-judicial, or judicial in character." The decision also brings Illinois into the fold of the majority of states ruling on this issue: "[W]e recognized that 'the clear weight of authority in the United States holds that a legislative body acts administratively when it rules on applications for special use permits.'…[and]… Having been freshly and squarely presented with the question by the cause at hand, we now answer it by holding that municipal bodies act in administrative or quasi-judicial capacities when those bodies conduct zoning hearings concerning a special use petition. As we stated in Living Word, the "clear weight of authority" so holds. Living Word, 196 Ill. 2d at 14. To the extent any prior decisions of this court hold the contrary to be true, we now expressly overrule those decisions."



The second case in the trilogy is Gallik v. County of Lake, (2nd Dist., November, 2002),, 335 Ill.App.3d 325, 781 N.E.2d 522, 269 Ill.Dec. 725, and here the Second District confronted the same legal issue, but this time acknowledging direction from the Supreme Court in Klaeren. Gallik wished to construct a single family residence on property that was partially located in a floodplain, and therefore needed a conditional use permit from Defendant, Lake County. The Lake County Zoning Board of Appeals and the Lake County Board denied the request for a conditional use permit. The trial court certified the question for review on appeal as "Whether the Illinois Administrative Review Act, 735 ILCS 5/3-101 et seq., is applicable for judicial review of the County of Lake's denial of Plaintiff's conditional use application in this case, or whether the dismissal of Count I of the Complaint is warranted because the denial of a conditional use permit is a legislative action…" Taking its cue from Klaeren, (and the Living Word decision cited therein), the decision here notes that "The characterization of the type of act undertaken by the legislative body controls the type of review to which that act is subject. If it is an administrative act, it will be subject to administrative review pursuant to the Administrative Review Act…; if it is a legislative act, it is not subject to administrative review, but the action will be reviewed for arbitrariness as a matter of substantive due process." Accordingly, granting special use or conditional permits, or deciding application of an ordinance to particular cases is a administrative, quasi-judicial activity and subject to review for due process. Only in "prescribing general rules" can a body be acting in a truly legislative function that allows "immunity" from review other than for "arbitrariness". In denying Gallik's application for a conditional use permit, Lake County was acting in the realm of it's administrative rather than legislative capacity, and its actions therefore are subject to administrative review to determine if due process was extended.



This same question of law comes to the surface in another recent Second District case, Oak Grove Jubilee Center, Inc. v. The City of Genoa, (May 9, 2003), Oak Grove Jubilee Center was a non-profit, incorporated church pastored by Rev. Bill Meyers that sought a special use permit from the City of Genoa to operate a church facility on Main Street within the city limits. The City has an ordinance which excludes churches from locating anywhere in the city as a matter of right, and therefore the church had to obtain a special use permit for the property it was occupying at the time on a month to month oral lease. When the application was denied, the Jubilee Center filed its complaint against the City alleging the denial of its request for a special use permit was a violation of equal protection under the state constitution, federal constitution, and the Illinois Religious Freed Restoration Act. When Jubilee moved for Summary Judgment on its Complaint, the trial court, sua sponte dismissed the Complaint noting that the application for the special use permit was void ab initio for three reasons: (1) There was no indication in the application that Jubilee was a corporation or other form of entity with legal capacity to sue; (2) There was no indication in the application that Pastor Meyers had authority to request the special use permit on behalf of the Jubilee Center; and, (3) The application could not be filed or presented by Meyers on behalf of the corporation because he was a layman and not an attorney licensed to practice law. The Second District opinion reversed, finding the dismissal to have been in error and remanded for a hearing on the petition for summary judgment filed by the Jubilee Center following some fairly complex legal gymnastics which are set forth in an extraordinarily clear fashion in the written decision. First, noting that if the Illinois Supreme Court holding in Klaeren, were applied to the Jubilee proceedings, (i.e., this was an "administrative or quasi-judicial" rather than a "legislative" process), Judge Grometer states that the legal basis of the trial court's sua sponte ruling relating to standing to proceed, representation, and necessity of a lawyer representing Jubilee would likely have to be affirmed; (i.e., in an administrative proceeding the failure to indicate Jubilee's standing as an entity entitled to apply for a special use permit, Meyer's authority to present the request, and Meyer's capacity as a non-lawyer to represent it in the process would have been a proper basis to dismiss the complaint due to the underlying defects in the application.) The Court, however, refused to retroactively apply Klaeren to the instant case because decisions which "overrules clear past precedent or decides an issue of first impression that was not clearly foreshadowed" should be "limited to prospective application". Accordingly, this special use application and hearing was a "legislative" rather than "administrative" process, and (1) Meyer need not be a lawyer to file and prosecute a special use application any more than he would need be a lawyer to conduct "lobbying" activities in the legislature; (2) while an entity must have a stated capacity to file a suit, it does not need to state that capacity to seek a legislative enactment; and, (3) Rev. Meyer's filing of the application did not require him to be authorized to undertake activities in a legislative process on behalf of the Jubilee Center. While the decision in this case is limited because of the non-applicability of the law newly established in Klaeren, it is also worth reading for the clarity of the discussion of the likelihood that a sua sponte ruling by a trial court may violate a party's due process rights, (i.e., a party may not be given an opportunity to be heard on the issues which the trial court grasps as determinative in its sua sponte ruling), and the rejection of the City's argument that the case became moot when the church's month-to-month lease was terminated.

(Ed. Note: For an excellent review of the cases and theories that lead to and are discussed in this decision, see "A New Era in Land Use, Klaeren & Gallik", by Pat Lord and Robin Perry, published in the Local Government Law Section Newsletter, March 2003, Vol. 39, No. 8, )



As market places become more competitive, retailers become more creative in their efforts to compete. Financing is an all important part of real estate transactions in the current market place because of the historically low interest rates available. The home improvement industry has long been driven by the ease and accessibility of financing. One response of the legislature to the abuse of the consumer that frequently accompanies increased competition in the financing arena is the Illinois Credit Services Organization Act, (815 ILCS 605/1 e t seq.). Recently, the Illinois Supreme Court decision in Midstate Siding and Window Company, Inc. v. Kenneth Rogers, (April, 2003),, ruled that the Act does not apply to a home improvement transaction between a retailer, (Midstate Siding), and homeowners, (Rogers), who admittedly would not have entered into the contract for the improvements but for Midstate's promise to obtain financing for them as part of the transaction. When Rogers was informed by Midstate that financing was obtained, (after at least two rejections), they determined that they did not wish to proceed with the contract and refused to allow Midstate to perform. Midstate filed suit to recover its lost profit, costs, overhead and attorneys fees under the contract. Rogers counter sued alleging that Midstate failed to provide them with the necessary disclosures of definite and certain terms relating to the financing, thereby violated the Credit Services Organization Act, and this rendered the contract unenforceable under the Act. The trial court and appellate courts ruled in Rogers' favor. Midstate appealed the finding that the Act was applicable to them, and the Illinois Supreme Court reversed, ruling in Midstate's favor and finding the Act not applicable to this transaction. The facts were uncontroverted that Rogers would not have entered into the contract for home improvements without the representation that Midstate could find them financing. Rogers filled out a credit application with Midstate, and Midstate obtained financing after forwarding the application to several institutions. Midstate argued that its assistance in finding financing was a gratuitous service which did not bring them under the Act's purview. Rogers argued that there was "consideration" to Midstate for its credit service because they would not have entered into the contract without the credit application assistance. In the lower court rulings, each decision found that "The Plaintiff's (Midstate) assistance was more than a mere service, but was part of the consideration to support the agreement.", applied the Act, found the disclosure of certain and definite terms lacking, and thereby rendered the contract unenforceable. Justice Freeman's decision for the majority in the Supreme Court begins with an excellent overview of the law applicable to statutory construction and focuses on whether or not the legislature intended to regulate retailers such as Midstate in offering a "gratuitous service…in facilitating the extension of credit to their customers". Interpreting the Credit Services Act as requiring payment for credit services and not intended to apply to services simply incident to the primary business of selling goods and services to their customers, the majority reversed the application of the Act to Midstate. The dissent by Justice McBride is equally compelling. Noting that an employee of Midstate testified that her job was to help customers qualify for financing, that she reviewed more than 50 credit applications per week, and conducted all of the lending contacts herself, the dissent concludes that "Midstate's actions went far beyond simply selling goods to the Rogers". These were not merely ancillary, referral services being provided, and the consideration for those services was the fact that the Rogers otherwise would not have undertaken the contract. The Act specifies services covered as those provided "in return for the payment of money or others valuable consideration.", and here Rogers was induced by the promise to obtain financing without any disclosure of the terms and conditions. The dissent also felt that the conduct of Midstate violated the Consumer Fraud and Deceptive Business Practices Act by employing the "concealment, suppression or omission of any material fact" (i.e. the contractual interest rate) in a consumer transaction.



(Ed.'s Note: Dick notes that I "trumped" him last month by writing about a recent adverse possession case that came out of the Second District, Knauf v. Ryan, (2nd Dist., April 23, 2003),, before he could get to it. He's correct that I commented on the case first, (remember I get to cover nine "Keypoints" each month, while Dick only takes on one each month!), but no understanding of the case is complete without his "history lesson" on the survey problem that is at the foundation of this litigation. Dick really is the best there is, and once again his vast knowledge of the history of Illinois real estate law is a resource that is undeniably valuable and rare at the same time.)


Steve trumped me last month by writing about Knauf v. Ryan, et al., No. 2-01-1298, before I was able to comment on it. The case is interesting, but more, in my opinion, because of the facts presented in the case and not because of the eventual court decision, which turns on the law of adverse possession. In this case the court states that one of the surveyors who testified "opined that the 1971 survey was inaccurate. [The surveyor] believed that [another surveyor] did not actually determine the center, or 'quarter corners' of [the section,] but merely accepted a fence along the eastern boundary of defendants' property." The decision of the case did not depend on how the center of section was determined. However, it is quite possible that an attorney will encounter a legal description issue that stems from the "center of section" problem. Therefore, a discussion of this topic is in order. The Federal Land Act of February 11, 1805 (hereafter called the "1805 Act") mandated that surveyors must locate the center of a section of land at the intersection of the two straight lines connecting the north and south, east and west, quarter section corners. (These lines connecting the four quarter corners form a "+" sign; they delineate the four quarters of a section--the northwest, northeast, southwest, and southeast quarters.) But notwithstanding the 1805 Act, Justin Butterfield, Commissioner of the General Land Office, issued special instructions from 1849 to 1851 that directed that the center of the section be located at the midpoint of the line connecting the east quarter section corner and the west quarter section corner. Similar instructions were in use from 1856 to 1883; they were issued to deputy surveyors for the District of Illinois and Missouri. They provided that "[the surveyor should] run a true line from [the east quarter section corner] to [the west quarter section corner], and at equidistance between them establish [the center of the section]." Clearly both sets of instructions were contrary to the 1805 Act. Confused Illinois surveyors sought an opinion from Abraham Lincoln, who was a prominent surveyor and lawyer before he became president. Lincoln responded just two years before he assumed the presidency that "I think the true rule for dividing into quarters, any interior section, or section which is not fractional is to run straight lines through the section from the opposite quarter-section corners, fixing the point where the straight lines cross, or intersect each other, as the middle or center of the section." In other words, he agreed with the 1805 Act. Despite Lincoln's opinion, many surveyors in Illinois and other states continued to locate the center of section in accordance with the erroneous 1856 instructions. Some surveyors, in fact, even went so far as to locate the center, not at the midpoint of that line connecting the east and west quarter section corners, but instead at the midpoint of that line connecting the north and south quarter section corners. What, then, does the surveyor do when he comes across conflicting monumentation at the center of a section? To my mind there is an inherent problem here. What if the surveyor surveys the property and discovers that the section was originally surveyed contrary to the 1805 Act, but that improvements have been built on the land in reliance on this "wrong" means of surveying? This would result in a section having two centers of section, the "true" center of section and the "accepted" center of section. The surveyor should first do extensive field work, investigate records at the Recorder's Office, and discuss the matter with other surveyors who have worked in the area to make sure that there is indeed a center of section issue. I recently worked on a center of section problem in Will County. The surveyor told me that one survey company was doing work in this area in the 1930s and came across a stone monument that has since been replaced by an iron pipe. This monument was at the "accepted" center of section and has been relied on by other surveyors (and also by the Illinois Department of Transportation) since the 1930s. This pipe also fits with the monumentation along Illinois Route I-55. In this Will County example, the surveyor determined that when the land was surveyed using the "true" center of section, there were encroachment problems. But when the land was surveyed utilizing the "accepted" center of section, everything fit perfectly with no encroachments. It seems to me that if improvements have been constructed in reliance on an "accepted" center of section, it would be imprudent for the surveyor and the title company to ignore the admittedly improper means of surveying and to stubbornly insist that the "true" center was the only "right" center. In this regard, I am reminded of Justice Cooley, the Michigan Supreme Court justice. He was quoted in the Illinois Supreme Court case Westgate v. Ohlmacher, 251 Ill. 538 at 542 (1911), which dealt with a boundary problem in DeKalb County: "Nothing is better understood than that few of our early plats will stand the test of a careful and accurate survey without disclosing errors. This is as true of the government surveys as of any others, and if all the lines were now subject to correction on new surveys, the confusion of lines and titles that would follow would cause consternation in many communities. Indeed, the mischiefs that must follow would be simply incalculable, and the visitation of the surveyor might well be set down as a great public calamity." The court went on to state that Judge Cooley's remarks were applicable in this case, that "to permit a re-location of the lines dividing the property fronting upon Somonauk Street (which would involve the adjoining blocks and streets) would be to unsettle the title and boundary lines of the entire party of the city of Sycamore in which block 15 is located." After the surveyor has done his research, he should prepare his final plat of survey. He should show both centers of section on his survey. The burden is then on the title company to decide how to underwrite the issue. If one uses the "true" center of section, are there encroachment problems? On the other hand, if one uses the "accepted" center of section, do these problems disappear? If the title company can verify that the accepted center has been relied on for many years, perhaps it can similarly rely on the accepted center of section when insuring the property. So that problems do not arise in the future, perhaps the legal description should be amended to make reference to both the "accepted" center of section and the location of said accepted center relative to the "true" center. For example: "Commencing at a 6" x 6" monumental stone at the accepted center of said section, said accepted center being _______ feet (north or south) and ________ feet (east or west) of the intersection of the straight lines connecting all four quarter section corners. . . ."

Dick Bales

Chicago Title Insurance Company Wheaton



In Save the Prairie Society v. Greene Development Group, Inc., (1st Dist., April 28, 2003),, the Society, a non-profit organization dedicated to the preservation of prairie and nature preserve areas, brought suit against Greene to enforce a restrictive covenant and prevent it from developing a five acre parcel with 5 buildings, (four of which would each contain 32 residential units), within a subdivision in which it was also a property owner. In a prior appeal, the First District reversed the trial court's refusal to issue an injunction against Greene commencing construction during the pending litigation. On remand, the trial court issued the injunction as directed, but required the Society to post a bond of $200,000. The Society appealed a second time. The First District opinion by Justice McNulty again reverses and remands the case to the trial court. Finding that the trial court abused its discretion by ordering a large bond amount from a non-for-profit corporation which serves the public interest with limited resources, the remand orders that the preliminary injunction be entered without bond. The status of the Society as serving the public interest was established by testimony from the Cook County Forest Preserve District describing the area as "a unique natural area with national and international ecological value" in which the District preferred to see no major development of the residential community. The First District seized upon this as evidence that the Society serves "the public interest". The Court's sensibilities were clear in the recitation that a $200,000 bond would constitute a grave burden on the Society as constituting more than a quarter of its total assets and "about as much income as the organization could hope to net in a century."; (i.e., the previous year's total revenues of $58,000 from charitable donations left only $2,094 after expenses of $56,000 for the year, and the current calendar year projected net income of only $200.00.) The law of the case notes that 735 ILCS 5/11-103 provides that the requirement of the bond and the amount of the bond lies within the trial court's sound discretion, considering the costs and damages that may be incurred by a party later found to have been wrongfully restrained. "A party's limited financial resources can provide good cause for requiring no bond….Plaintiff's status as a not-for-profit corporation may warrant waiver of the bond requirement, especially where the corporation serves the public interest." Citing federal district cases where no bond was required in suits to enforce the "public interest" on behalf of "indigent plaintiffs, from whom it would be unjust to require security", and where the possible loss to the enjoined party when compared to the hardship the bond requirement would impose was minor, the First District noted a "court may dispense with security where there has been no proof of likelihood of harm to the party enjoined." Here, Green had offered no evidence that it would suffer loss due to the injunction. Although their right to develop the property was enjoined, the decision notes that "While Green will need to wait to realize its projected profits, the record presents no reason to believe that the profits will not increase sufficiently to compensate it for the delay". (Is this 'judicial notice' of the time value of a money investment in raw land to be developed in the future?) "In view of the public interest, the plaintiff's lack of financial resources, and the lack of evidence of any loss to defendants from a temporary injunction for the duration of trial, we find that the trial court abused its discretion by imposing a bond of $200,000. We reverse …and remand with instructions to eliminate the bond requirement…".



In Forest Preserve District of DuPage County v. Jack C. Miller, (2nd Dist. May 19, 2003),, the Forest Preserve appealed the decision of the trial court dismissing its condemnation action based on a finding that the enabling legislation did not describe the real estate sought to be condemned with reasonable certainty. The parcel was a 35 acre area known as Rodenburg Marsh owned by Jack Miller. The Forest Preserve District brought its action pursuant to an Ordinance adopted on August 4, 1998. The Ordinance attached as Exhibit "A", a metes and bounds description of the Marsh which left out a 2.3 acre portion of the property in error, and Exhibit "B" which was a plat map that portrayed the entire 35 acre parcel. Thereafter, an amended complaint was filed which attached Exhibit "C", a revised metes and bounds description that was consistent with the plat map and included the entire 35 acre parcel. Jack Miller filed his pro se appearance and a handwritten pleading stating that he was "formally objecting to the condemnation of my property…(by) this traverse/counterclaim." At the trial of the case some two years later, the trial court found that Miller had filed a "general traverse" objecting on the basis of the District's failure to attempt good faith negotiations and objecting to the constitutionality of the enabling ordinance. Failing to appear at the hearing, however, a judgment was entered after testimony from the District's expert that the property had a fair market value of $700,000. Defendant thereafter filed a post-trial motion arguing that the District lacked authority to condemn because the ordinance did not accurately describe the property and attacking the valuation of the property. The trial court held that "The law is clear that the property to be condemned must be reasonably described in the enabling action of the condemnor, be it in an ordinance or resolution." Here, the ordinance incorrectly described the parcel. The amended complaint, although correctly describing the parcel by the addition of Exhibit "C", was not authorized by the ordinance because the ordinance did not adequately describe the parcel as amended. Since the amended complaint sought to condemn a parcel different from, and in excess of, the parcel described in the Ordinance, the District had exceeded its authority. On appeal, the District argued that Miller had waived his right to attack its authority by not raising the issue in a timely manner, and specifying the defect in the legal description. Noting that he had only filed a "general traverse", the Second District held that this was a sufficient pleading to attack the District's authority. Noting that "a traverse, by definition, is a denial of a material allegation of fact…[and]…A general traverse is a blanket denial of all the factual allegations contained in a complaint.", the Second District affirmed the trial court's ruling that this pleading was sufficient to shift the burden to the District to prove its prima facia case, and absent that, the action is properly dismissed. Here the general traverse acted as an attack on the District's authority to condemn and preserved this issue without waiver. Accordingly, a traverse need not be specific. The traverse also did not violate the Code of Civil Procedure requirement that a pleading contain an explicit denial of each allegation. A traverse is a common law "instrument that has been around since long before the adoption of the code;…[and]…not an answer, reply or any other such pleading within the meaning of section 2-610. Although consisting of a single, simple sentence, it was sufficient to put the plaintiff on notice that Miller was challenging its authority to condemn." When a government entity other than the State itself exercises the power of eminent domain, it does so strictly pursuant to the authority granted by enabling legislation. It is settled law the enabling ordinance must reasonably describe the property to be taken, and a failure to do so undermines the statutory foundation upon which the action is based. "The appropriation of private property against an owner's will is harsh and against the common right…Being in derogation of common law, conferring statutes and enabling ordinances must be strictly construed in order to protect the rights of property owners…the failure of the plaintiff to adequately describe the property is fatal to the petition to condemn…[and here]…The enabling ordinance gave two inconsistent descriptions, and, therefore, the ordinance failed to reasonably describe the property taken." Citing cases in which the enabling ordinance was passed after the condemnation action begun and therefore failed, and one in which the ordinance did not describe the property at all as also being fatal, the Second District ruled: "The Plaintiff failed to sustain this burden [proving its prima facia case] due to the inaccurate descriptions contained in its enabling ordinance. …the Forest Preserve must strictly comply with the grant of authority given to them by the legislature. And in failing to do that, they have denied the property owner due process of law."



In Nottolini v. LaSalle National Bank, (2nd Dist., January 9, 2003),, 335 Ill.App.3d 1015, 782 N.E.2d 980, 270 Ill.Dec. 421, the familiar topic of the rights of owners of land adjacent to a lake was considered, but this time in the context of a "quarry" type lake. LaSalle Bank, a land trustee, owned a water-filled quarry adjacent to the Nottolini property. The quarry had been active at the turn of the century, but ceased activities in 1925. Thereafter the quarry filled with water and became a popular swimming area for neighboring landowners with the consent of the Defendant. In 1981, Nottolini purchased property adjoining the quarry and were permitted to swim in the quarry. (There was no written agreement, covenant or grant of record.) In 1997, a trespasser drowned in the quarry, and to guard against this occurring again, Defendant asked each of the adjacent landowners to erect a fence along their property line with the quarry. Although most of the surrounding owners did put up fences, Nottolini did not. Defendant then erected a fence and thereby denied Nottolini access to the quarry. Nottolini filed suit alleging that the quarry was a "lake" and that they had rights to use the lake which could not be restricted by Defendant because at times over the years, the quarry filled sufficiently with water so that a portion of the lake touched their property; giving them riparian rights. Defendants filed a counterclaim for declaratory judgment that they had exclusive rights to the surface waters and to enjoin Nottolini from removing the fence. The trial court ruled in favor of Nottolini, and LaSalle Bank appealed. The Second District reversed. Illinois law is that owners of land adjacent to a "lake" have an ownership interest in the lake bed and a right to reasonable use and enjoyment of the entire lake; provided they do not unduly interfere with the reasonable use of the waters by the other owners of the lake. No Illinois court, however, had previously defined a "lake", or ruled on whether a water-filled quarry was a "lake" subject to this rule of law. Turning to cases from Nebraska, Missouri and Texas, this decision concurs that a "lake" is a "body of water of natural origin", "a reasonably permanent body of water substantially at rest in a depression in the surface of the earth, if both depression and body of water are of a natural origin or a party of a watercourse", and concludes that "As defendant's quarry at issue herein is clearly man-made, plaintiffs do not have any rights in it."



Cases do seem to come in groups in particular areas of the law. Last month, we considered whether the notice requirement of Section 24 of the Mechanic's Lien Act could be satisfied by recording pursuant to Section 25 in Rothers Construction, Inc. v. Centurion Industries, Inc., (4th Dist., March 24, 2003), (this case was also the subject of Dick Bales' observations "From the Title Company Perspective".) This month we consider whether a letter sent by facsimile can satisfy the Act's notice requirement in Seasons-4, Inc. v. Hertz Corporation, (1st Dist., March 28, 2003), Plaintiff, Seasons-4, was a subcontract and manufacturer of air conditioning units installed at O'Hare Field. The property was owned by the City of Chicago and leased to Hertz. Hertz moved to dismiss the mechanic's lien count of Seasons-4's complaint to recovery money due to it based on a failure to serve a written notice of its' mechanic's lien claim within 90 days of delivering materials to the property as required by Section 24. Hertz argued that a March 20, 2001 notice it had received by mail came more than 90 days after the delivery of the air conditioning unit. Seasons-4 asserted, however, that it had previously provided written notice by facsimile correspondence to Hertz within 90 days following delivery of the air conditioning unit on January 25, 2001. The trial court dismissed finding that the facsimile letter failed to comply with the notice requirement of the Mechanic's Lien Act. The First District affirmed. Moving from the established law that mechanic's liens are in derogation of the common law and compliance issues must be strictly construed, the decision notes that the act requires service by registered or certified mail, delivery limited to addressee, and return receipt requested. There is no mention of delivery by facsimile transmission and "we will not usurp the authority of the legislature by holding that transmission by fax constitutes a valid method of serving a notice…". The plain language of the statute puts potential recipients on notice that they can expect notice of a claim for lien on property to come in only one of two ways: delivery in person or delivery by certified mail, limited to the addressee and return receipt requested. Neither approved form of notice transmission was employed here, and therefore the communication was outside of the Act's required procedure to perfect one's interest.



Knowing the little bits and pieces of real estate law that it takes to competently represent clients in real estate transactions these days is no small trick. I have a notebook. It contains listings of all of the local transfer tax and conveyance requirements, some sample contract paragraphs, and escrow provisions. When I come across a point of interest (and a good answer!) on the ISBA Listserv, I print a copy and add it to the notebook. Some recent examples:

ENCROACHMENTS: Question: I could use immediate help: Closing is schedule this morning. I represent Purchaser of property. Neighbor has very old garage (not used anymore) that has a corner that encroaches over the building line approximately 11 inches at its widest point onto the property Purchaser want to buy. Rest of garage angles across line where other corner is on its owners property. My Purchaser will not close without resolution of this issue. An endorsement is not an option as Purchaser is a builder that wants a nice clean lot when he sells new construction. I suggested a license agreement (thank you Dick bales) that will terminate in a few months to have Seller have neighbor sign, with the requirement of an indemnification / hold harmless against Purchaser by Seller, with a substantial escrow to assure removal of garage encroachment. Seller refuses, apparently because the property is tied up in an estate. Any suggestions. Purchaser wants to buy, but not buy Seller's problem.

Answer: "This is, of course, the problem presented in Nelson v. Anderson, 286 Ill.App.3d 706, 676 N.E.2d 735, 221 Ill.Dec. 932 (5th Dist. 1997). I never really thought this was much of a big deal, but the Andersons did. As you know, in this case the court allowed the voiding of a contract to purchase the Nelson home because of a building line violation, even though the title company agreed to endorse over it at no charge ad infinitum. The court made the statement that "no one can be compelled to buy a lawsuit." -- Dick Bales


Question: Can anyone please let me know what the dollar value of the current Homestead exemption (in Illinois) is and whether it has or will increase recently or in the near future. Thank you in advance.

Answer: 735 ILCS 5/12-901 provides as follows: Every individual is entitled to an estate of homestead to the extent in value of $7,500 of his or her interest in a farm or lot of land and buildings thereon, a condominium, or personal property, owned or rightly possessed by lease or otherwise and occupied by him or her as a residence, or in a cooperative that owns property that the individual uses as a residence. That homestead and all right in and title to that homestead is exempt from attachment, judgment, levy or judgment sale for the payment of his or her debts or other purposes and from the laws of conveyance, descent and legacy, except as provided in this Code . . . . Relative thereto, the following points are noted: 1. Prior to 1982, what was then the Illinois Homestead Act stated that every householder having a family was entitled to an estate of homestead. Public Act 82-685, effective January 1, 1982, amended the Act so that a family is not necessary. Now, an individual is entitled to a homestead.

2. Public Act No. 82-685 also changed the amount of the homestead exemption from $10,000 to $7,500.00. Thus, this Act lowered the exemption amount. However, the legislative history of Public Act No. 82-685 indicates that since now "every individual" is entitled to a homestead estate, a married couple who together own the residence in which they live can claim homestead exemptions for a combined total of $15,000.

Dick Bales (Again!)

HOMESTEAD ESTATE: Question: Re: homestead rights in the following situation:

Husband and wife own real estate. Wife deeds to Husband, and Husband deeds to himself and one child. Couple continues to reside in the home. Husband dies. Child becomes sole owner. Wife leaves home to live with different child. She never really "moves out," but she does not reside in the home again. Does Wife still have homestead rights in the property which is now owned by child? Once you have homestead rights, are they there even if you leave? I think so, but I would welcome your opinion.

Answer: 735 ILCS 5/12-901 provides as follows: "Every individual is entitled to an estate of homestead to the extent in value of $7,500 of his or her interest in a farm or lot of land and buildings thereon, a condominium, or personal property, owned or rightly possessed by lease or otherwise and occupied by him or her as a residence, or in a cooperative that owns property that the individual uses as a residence. That homestead and all right in and title to that homestead is exempt from attachment, judgment, levy or judgment sale for the payment of his or her debts or other purposes and from the laws of conveyance, descent and legacy, except as provided in this Code . . . ." However, I am puzzled by your statement that the wife "never really moves out." Without knowing more, it is difficult to answer the question. See 735 ILCS 5/12-902, which provides that the homestead exemption continues for the benefit of the surviving spouse, as long as she remains in possession of the property. But this statute appears to apply to the homestead exemption and not the homestead estate, which is a separate interest. If you are asking this question because a real estate closing is imminent, see 735 ILCS 5/12-904, which provides three methods of releasing, waiving, or conveying a homestead interest: "No release, waiver or conveyance of the estate so exempted shall be valid, unless the same is in writing, signed by the individual and his or her spouse, if he or she have one, or possession is abandoned or given pursuant to the conveyance...but if a conveyance is made by an individual as grantor to his or her spouse, such conveyance shall be effectual to pass the title expressed therein to be conveyed thereby, whether or not the grantor in such conveyance is joined therein by his or her spouse." Note that homestead can be waived if possession is given up pursuant to the conveyance. So if there is to be a sale of the property, and if a deed is obtained from the owner of the land, and everyone moves out, then there really is not an issue. I feel that almost always a homestead problem can be worked out, but it really depends on the specific facts. You probably should discuss this situation with the title company insuring the transaction. Dick Bales - (who else?)

Dick Bales is a frequent source/resource for answers to transactional real estate problems on the list serve, but he has a lot of friends who also are knowledgeable and often willing to share their knowledge. Their wisdom is collected in a recently published IICLE title: "Residential Real Estate - 2003 ". Edited by Myles Jacobs, past chair of the ISBA Real Estate Section Council, this hands-on, practice-oriented work consists of twenty-five (25) chapters ranging from "The Role of an attorney in a Real Estate Transaction", (written by Bob Duffin, employed by First American Title Company, who isn't writing about his own place in the 'food chain'), to "Disclosures" (by Joe Fortunato whose firm handled a noted case in this area, Provenzale v. Forister) and "Inspections" (authored by a consortium of five authors), includes chapters on title, survey, condominium and homeowner associations, followed by works on the "Purchase of Newly Constructed Homes", (Jim Dunneback), installment contracts, leases, condemnation, bankruptcy, foreclosure, mechanic's lien, easements, licenses and insurance. There isn't much that this work doesn't cover. With a focus on Illinois real estate and Illinois law by experienced attorneys who practice on a day to day basis, this "practice handbook" is certain to be a valuable tool to transactional attorneys trying to stay competent in real estate transactional work.