In 5510 Sheridan Road Condominium Association v. U.S. Bank, 2017 IL App. (1st) 160279 (March 31, 2017) the First District Appellate Court clarified some confusion over how Section 9(g)(3) of the Condominium Property Act (765 ILCS 605/9(g)(3)) operates to foreclose an assessment lien and concluded that when the foreclosure sale purchaser makes the payment of post-sale assessments is irrelevant to whether the lien is extinguished.
In that case, the condominium association of a foreclosed property sued the mortgagee who purchased the property in foreclosure for payment of the unpaid condominium expenses, including those that accrued prior to the foreclosure and which were included in the foreclosure decree. The circuit court found in favor of the condominium association, entering judgment for nearly $75,000.00 and granting it an order of possession.
On appeal, the purchaser argued that it should be entitled to judgment, not the association. It contended that the lien for assessments was extinguished in the foreclosure when it paid all of the post-sale expenses to the association. Although the purchaser waited approximately eight months following the judicial sale to tender assessment payments, it eventually paid the full amount that it owed. The association argued that Section 9(g)(3) requires that the assessment lien is extinguished only when the purchaser “timely” pays the post-sale assessments. Because the post-sale assessments were not paid on the first day of the month following the judicial sale, and in fact were not fully paid until the association sued, the lien was not extinguished.
The appellate court reversed and entered judgment for the purchaser. The First District held that the plain language of the Condominium Act did not set a strict deadline on when payment must be made. The language “from and after the first day of the month after the date of the judicial foreclosure sale” in the statute does not create a timing deadline, but merely demarcates the precise moment when the purchaser becomes liable for post-sale assessments. Thy court found it did not matter that the purchaser did not make the full payment until it was sued. The fact that it paid the full amount of the post-sale assessments successfully extinguished the assessment lien.Download Related Document