Public Act 098-0764
 
SB3023 EnrolledLRB098 17607 HEP 52719 b


  
    AN ACT concerning civil law.
  
 
    Be it enacted by the People of the State of Illinois,
 
represented in the General Assembly:
  
 
 
    Section 5. The Mechanics Lien Act is amended  by changing 
Sections 1 and 21 as follows:
 



    (770 ILCS 60/1)  (from Ch. 82, par. 1)



    Sec. 1. Contractor defined; amount of lien; waiver of lien; 
attachment of lien; agreement to waive; when not enforceable.

    (a) Any person who shall by any contract or contracts, 
express or
implied, or partly expressed or implied, with the 
owner of a lot or
tract of land, or with one whom the owner has 
authorized or knowingly
permitted to contract, to improve the 
lot or tract of land or for the purpose of improving the tract 
of land, or to manage a
structure under construction thereon, 
is known under this Act as a contractor and has a lien upon the 
whole of such lot or tract of land and upon adjoining or 
adjacent lots or tracts of land of such owner constituting the 
same premises and occupied or used in connection with such lot 
or tract of land as a place of residence or business; and in 
case the contract relates to 2 or more buildings, on 2 or more 
lots or tracts of land, upon all such lots and tracts of land 
and improvements thereon for the amount due to him or her for 
the material, fixtures, apparatus, machinery, services or 
labor, and interest at the rate of 10% per annum from the date 
the same is due. This lien extends to an estate in fee, for 
life, for years, or any other estate or any right of redemption 
or other interest that the owner may have in the lot or tract 
of land at the time of making such contract or may subsequently 
acquire and this lien attaches as of the date of the contract.
    (b) As used in subsection (a) of this Section, "improve" 
means to furnish labor, services, material, fixtures, 
apparatus or
machinery, forms or form work in the process of 
construction where
cement, concrete or like material is used 
for the purpose of or in the
building, altering, repairing or 
ornamenting any house or other building,
walk or sidewalk, 
whether the walk or sidewalk is on the land or bordering

thereon, driveway, fence or improvement or appurtenances to the 
lot or
tract of land or connected therewith, and upon, over or 
under a sidewalk,
street or alley adjoining; or fill, sod or 
excavate such lot or tract of
land, or do landscape work 
thereon or therefor; or raise or lower any house
thereon or 
remove any house thereto, or remove any house or other 
structure
therefrom, or perform any services or incur any 
expense as an architect,
structural engineer, professional 
engineer, land surveyor or
property manager in, for or on a lot 
or tract of land for any such purpose;
or drill any water well 
thereon; or furnish or perform labor or services as

superintendent, time keeper, mechanic, laborer or otherwise, 
in the
building, altering, repairing or ornamenting of the 
same; or furnish
material, fixtures, apparatus, machinery, 
labor or services, forms or form
work used in the process of 
construction where concrete, cement or like
material is used, 
or drill any water well on the order of his agent,
architect, 
structural engineer or superintendent having charge of the

improvements, building, altering, repairing or ornamenting the 
same.
    (c) The taking of additional
security by the contractor or 
sub-contractor is not a waiver of any
right of lien which he 
may have by virtue of this Act, unless made a
waiver by express 
agreement of the parties and the waiver is not
prohibited by 
this Act.

    (d) An agreement to waive any right to enforce or claim any 
lien under this Act, or an agreement to subordinate the lien, 
where the agreement is in anticipation of and in consideration 
for the awarding of a contract or subcontract, either express 
or implied, to perform work or supply materials for an 
improvement upon real property is against public policy and 
unenforceable. This Section does not prohibit release of lien 
under subsection (b) of Section 35 of this Act, nor does it 
prohibit an agreement to subordinate a mechanics lien to a 
mortgage lien that secures a construction loan if that 
agreement is made after more than 50% of the loan has been 
disbursed to fund improvements to the property or prohibit 
subordination of the lien, except as provided in Section 21.

(Source: P.A. 94-627, eff. 1-1-06.)

 



    (770 ILCS 60/21)  (from Ch. 82, par. 21)



    Sec. 21. Sub-contractor defined; lien of sub-contractor; 
notice; size of type; service of notice; amount of lien; 
default by contractor.

    (a) Subject to the provisions of Section 5, every mechanic,

worker or other person who shall furnish any labor, services, 
material, fixtures, apparatus or
machinery, forms or form work 
for the
contractor, or shall furnish any material to be 
employed in the process
of construction as a means for 
assisting in the erection of the building
or improvement in 
what is commonly termed form or form work where
concrete, 
cement or like material is used in whole or in part, shall be

known under this Act as a sub-contractor, and shall have a lien 
for the
value thereof, with interest on such amount from the 
date the same is
due, from the same time, on the same property 
as provided for the
contractor, and, also, as against the 
creditors and assignees, and
personal and legal 
representatives of the contractor, on the material,
fixtures, 
apparatus or machinery furnished, and on the moneys or other

considerations due or to become due from the owner under the 
original
contract.
    (b) If the legal effect of a provision in any contract 
between the owner and
contractor or contractor and 
subcontractor is that no lien or claim may be filed or 
maintained by any
one and the waiver is not prohibited by this 
Act, or that such contractor's lien shall be subordinated to 
the interests of any other party, and the provision is not 
prohibited by this Act, such provision shall be
binding if made 
as part of an agreement not prohibited by this Act. such 
provision shall be
binding; but the only admissible evidence

thereof as against a subcontractor or material supplier, shall 
be proof of
actual notice thereof to him or her before his or 
her contract is entered into. Such subordination provision 
shall not be binding on the subcontractor unless set forth in 
its entirety in writing in the contract between the contractor 
and subcontractor or material supplier.

    (c) It shall be the duty of each subcontractor who has 
furnished, or is
furnishing, labor, services, material, 
fixtures, apparatus or machinery, forms or form work for an 
existing owner-occupied single
family residence, in order to 
preserve his lien, to notify the occupant
either personally or 
by certified mail, return receipt requested,
addressed to the 
occupant or his agent of the residence within 60 days
from his 
first furnishing labor, services, material, fixtures, 
apparatus or machinery, forms or form work, that he is 
supplying labor, services, material, fixtures, apparatus or 
machinery, forms or form work provided, however, that any 
notice given after 60
days by the subcontractor shall preserve 
his lien, but only to the
extent that the owner has not been 
prejudiced by payments made prior to
receipt of the notice.  The 
notification shall include a warning to the
owner that before 
any payment is made to the contractor, the owner
should receive 
a waiver of lien executed by each subcontractor who has

furnished labor, services, material, fixtures, apparatus or 
machinery, forms or form work.

    The notice shall contain the name and address of the 
subcontractor or
material man, the date he started to work or 
to deliver materials, the
type of work done and to be done or 
the type of materials delivered and
to be delivered, and the 
name of the contractor requesting the work.
The notice shall 
also contain the following warning:

"NOTICE TO OWNER


    The subcontractor providing this notice has performed work 
for or
delivered material to your home improvement contractor.  
These services or
materials are being used in the improvements 
to your residence and entitle
the subcontractor to file a lien 
against your residence if the services or
materials are not 
paid for by your home improvement contractor.  A lien
waiver 
will be provided to your contractor when the subcontractor is 
paid,
and you are urged to request this waiver from your 
contractor when paying
for your home improvements."

    Such warning shall be in at least 10 point bold face type.  
For
purposes of this Section, notice by certified mail is 
considered served
at the time of its mailing.

    (d) In no case, except as hereinafter provided, shall the 
owner be
compelled to pay a greater sum for or on account of 
the completion of
such house, building or other improvement 
than the price or sum
stipulated in said original contract or 
agreement, unless payment be
made to the contractor or to his 
order, in violation of the rights and
interests of the persons 
intended to be benefited by this Act: Provided,
if it shall 
appear to the court that the owner and contractor
fraudulently, 
and for the purpose of defrauding sub-contractors fixed an

unreasonably low price in their original contract for the 
erection or
repairing of such house, building or other 
improvement, then the court
shall ascertain how much of a 
difference exists between a fair price for
labor, services, 
material, fixtures, apparatus or machinery, forms or form work 
used in said house, building or other improvement,
and the sum 
named in said original contract, and said difference shall
be 
considered a part of the contract and be subject to a lien. But 
where
the contractor's statement, made as provided in Section 
5, shows the
amount to be paid to the sub-contractor, or party 
furnishing material,
or the sub-contractor's statement, made 
pursuant to Section 22, shows
the amount to become due for 
material; or notice is given to the owner,
as provided in 
Sections 24 and 25, and thereafter such sub-contract
shall be 
performed, or material to the value of the amount named in such

statements or notice, shall be prepared for use and delivery, 
or
delivered without written protest on the part of the owner 
previous to
such performance or delivery, or preparation for 
delivery, then, and in
any of such cases, such sub-contractor 
or party furnishing or preparing
material, regardless of the 
price named in the original contract, shall
have a lien 
therefor to the extent of the amount named in such
statements 
or notice. In case of default or abandonment by the
contractor, 
the sub-contractor or party furnishing material, shall have
and 
may enforce his lien to the same extent and in the same manner 
that
the contractor may under conditions that arise as provided 
for in
Section 4 of this Act, and shall have and may exercise 
the same rights
as are therein provided for the contractor.

    (e) Any provision in a contract, agreement, or 
understanding,
when payment from a contractor to a 
subcontractor or supplier is
conditioned upon receipt of the 
payment from any other party including a
private or public 
owner, shall not be a defense by the
party responsible for 
payment to a claim brought under Section 21, 22, 23,
or 28 of 
this Act against the party.  For the purpose of this Section,

"contractor" also includes subcontractor or supplier. The 
provisions of
Public Act 87-1180 shall be construed as

declarative of existing law and not as a new enactment.

(Source: P.A. 94-615, eff. 1-1-06; 94-627, eff. 1-1-06.)

  
 
    Section 99. Effective date. This Act takes effect upon 
becoming law.