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| [ Senate Amendment 001 ] |
91_SB0749eng SB749 Engrossed LRB9103048DJcd 1 AN ACT to amend the Illinois Business Brokers Act of 1995 2 by changing Sections 10-105 and 10-115. 3 Be it enacted by the People of the State of Illinois, 4 represented in the General Assembly: 5 Section 5. The Illinois Business Brokers Act of 1995 is 6 amended by changing Sections 10-105 and 10-115 as follows: 7 (815 ILCS 307/10-105) 8 Sec. 10-105. Scope of the Act. This Act shall apply 9 only when the person engaging or seeking to engageengaged or10sought to be engaged bythe business broker is domiciled in 11 this State or when the company or business sought to be sold 12 has its principal place of business in this State. 13 Notwithstanding any other provision of this Section, a lien 14 on property arising under Section 10-115 is enforceable only 15 against tangible property located in this State. 16 (Source: P.A. 90-70, eff. 7-8-97.) 17 (815 ILCS 307/10-115) 18 Sec. 10-115. Business broker lien. 19 (a) Any business broker shall have a lien upon the 20 tangible assets of a business located in this State that is 21 the subject of a business broker's written contractand the22proceeds from the sale of such businessin the amount due to 23thatthe broker under the written contractis due. 24 (b) The lien shall be available to the business broker 25 named in the instrument signed by the owner of an interest in 26 the assetsseller or purchaser. The lien arising under this 27 Act shall be in addition to any other rights that a business 28 broker may have. 29 (c) The lien under this Act shall attach upon the 30 business broker being otherwise entitled to a fee or SB749 Engrossed -2- LRB9103048DJcd 1 commission under a written contractinstrumentsigned by the 2 seller or itspurchaser or the seller or purchaser'sduly 3 authorized agent, as applicable, if, before the actual 4 conveyance or transfer of the business assets or property 5 with respect to which the business broker is claiming a 6 lien, the business broker files a notice of lien (i) in the 7 recorder's office of the county in which the real property is 8 located, as to real property, and (ii) in the Office of the 9 Secretary of State, as to tangible personal property. 10 (d) When payment to a business broker is due in 11 installments, a portion of which is due only after the 12 conveyance or transfer of the tangible assetsbusiness, any 13 claim for lien for those payments due after the transfer or 14 conveyance may be filed at any time subsequent to the 15 transfer or conveyance of the tangible assetsbusinessand 16 prior to the date on which the payment is due but shall only 17 be effective as a lien against the tangible assetsbusiness18or proceedsto the extent moneys are still owed to the 19 transferor by the transferee. The lien shall attach as of the 20 filing of the notice of lienand not relate back to the date21of the written agreement. 22 (e) If a business broker has a written agreement with a 23 prospective purchaseror seller, then the lien shall attach 24 upon the prospective purchaseror seller that ispurchasing,25selling,or otherwise accepting a conveyance or transfer of 26 the real property or tangible personal property of the 27 business and the filing of a notice of lien (i) in the 28 recorder's office of the county in which the real property is 29 located, as to real property, and (ii) in the Office of the 30 Secretary of State, as to tangible personal property, by the 31 business brokerin the Office of the Secretary of State32 within 90 days after the transfer to the purchaserpurchase,33sale, or other conveyance or transfer of the business that is34the subject of the written agreement with the business brokerSB749 Engrossed -3- LRB9103048DJcd 1. The lien shall attach to the interest purchased by the 2 purchaser as of the date of the filing of the notice of lien 3 and does not relate back to the date of the written contract 4receipt of any consideration by the seller of the business5that is the subject of the written agreement with the6business broker. 7 (f) The business broker shall, within 10 days after 8 filing its notice of lien, mail a copy of the notice of lien 9 to the owner of the propertybusinessby depositing it in the 10 United States mail, registered or certified mail, with return 11 receipt requested, or personally serve a copy of the notice 12servedon the owner of record or his agent.If the lien is13filed within 10 days prior to closing, the business broker is14not required to mail or personally serve a copy of the notice15of lien. Mailing of the copy of the notice of lien is16effective if mailed to the address of the business that is17the subject of the notice of lien, or to such other address18as the seller or purchaser has provided to the business19broker in writing and signed by the seller or purchaser.20 Mailing of the copy of the notice of claim for lien is 21 effective if mailed to the seller at the address of the 22 business that is the subject of the notice of lien or to 23 another address that the seller or purchaser has provided in 24 writing to the business brokerwhen deposited in a United25States mailbox with postage prepaid. The broker's lien shall 26 be unenforceable if mailing of the copy of the notice of lien 27 does not occur at the time and in the manner required by this 28 Act. 29 (g) A business broker may bring suit to enforce a lien 30 in the circuit court (i) in the county where the real 31 propertyheadquarters of the business being soldis located, 32 as to real property, or (ii) as to tangible personal 33 property, either in the county where the personal property 34 is located or where the principal office of the owner of the SB749 Engrossed -4- LRB9103048DJcd 1 personal property, or the owner's residence, is located 2where the purchaser resides (or maintains its headquarters)3if the lien is being filed against the purchaser, or where4the seller resides (or maintains its headquarters) if the5lien is filed against the seller, by filing a complaint and 6 sworn affidavit that the lien has been filed. 7 (h) The person claiming a lien shall, within 2 years 8 after filing the lien, commence proceedings by filing a 9 complaint. Failure to commence proceedings within 2 years 10 after filing the lien shall extinguish the lien. No 11 subsequent notice of lien may be given for the same claim nor 12 may that claim be asserted in any proceedings under this Act. 13 (i) A complaint under this Section shall have attached 14 to it a copycontain a brief statementof the written 15 contractor agreementson which the lien is founded and shall 16 contain, the date when the contract or agreement was made,a 17 description of the services performed, the amount due and 18 unpaid, a description of the tangible assets of the business 19 thatis, or the proceeds from sale of whichare,subject to 20 the lien, and other facts necessary for a full understanding 21 of the rights of the parties. The plaintiff shall make all 22 interested parties, of whose interest the plaintiff is 23 notified or has knowledge, defendants to the action and shall 24 issue summons and provide service as in other civil actions. 25 When any defendant resides or has gone out of the State, or 26 on inquiry cannot be found, or is concealed within this State 27 so that process cannot be served on that defendant, the 28 plaintiff shall cause a notice to be given to that defendant, 29 or cause a copy of the complaint to be served upon that 30 defendant, in the manner and upon the same conditions as in 31 other civil actions. Failure of the plaintiff to provide 32 proper summons or notice shall be grounds for judgment 33 against the plaintiff with prejudice. Every lien claimed 34 under this Act shall be foreclosed as provided in the SB749 Engrossed -5- LRB9103048DJcd 1 Illinois Mortgage Foreclosure Law, if the lien is on real 2 property, or as provided in the Uniform Commercial Code, if 3 the lien is on personal property. 4 (j) The lien notice shall state the name and address of 5 the claimant, the name of the purchaser or seller whose 6 property or assets are subject to the lien, a description of 7 the real or personal property that is subject to the lien 8business upon which or upon the proceeds from the sale of9which the lien is being claimed, the amount for which the 10 lien is claimed, and the registration number of the business 11 broker. The notice of lien shall recite that the information 12 contained in the notice is true and accurate to the knowledge 13 of the signersignatory. The notice of lien shall be signed 14 by the business broker or by a person authorized to sign on 15 behalf of the business broker and shall be verified. 16 (k) Whenever a claim for lien has been filed with the 17 Office of the Secretary of State or the county recorder's 18 office and a condition occurs that would preclude the 19 business broker from receiving compensation under the terms 20 of the business broker's written agreement, the business 21 broker shall provide to the purchaser of the business, if the 22 lien is filed against the purchaser's assets of the business 23 that are subject to this Actpurchaser, or the seller of the 24 business, if the lien is filed against the seller's assets of 25 the business that are subject to this Actseller, within 10 26 days following demand by that partythe owner of record, a 27 written release or satisfaction of the lien. 28 (l) Upon written demand of the owner, lienee, or other 29 authorized agent, served on the person claiming the lien 30 requiring suit to be commenced to enforce the lien or answer 31 to be filed in a pending suit, a suit shall be commenced or 32 answer filed within 30 days thereafter, or the lien shall be 33 extinguished. Service may be by registered or certified 34 mail, return receipt requested, or by personal service. SB749 Engrossed -6- LRB9103048DJcd 1 (m) If a claim for lien has been filed with the Office 2 of the Secretary of State or the county recorder's office and 3 is paid,or if there is failure to institute a suit to4enforce the lien within the time provided by this Act,the 5 business broker shall acknowledge satisfaction or release of 6 the lien, in writing,on written demand of the purchaser of7the business, if the lien is filed against the purchaser, or8the seller of the business, if the lien is filed against the9seller,within 5 days after paymentor expiration of the time10in which to file the lien. 11 (n) The cost of proceedings brought under this Act 12asserting or defending a business broker's claim of lien, 13 including reasonable attorneys' fees, costs, and prejudgment 14 interestinterestsdue to the prevailing party, shall be 15 borne by the nonprevailing party or parties. When more than 16 one party is responsible for costs, fees, and prejudgment 17 interest, the costs, fees, and prejudgment interest shall be 18 equitably apportioned by the court among those responsible 19 parties. 20 (o) Prior recorded liens and mortgages shall have 21 priority over a broker's lien. A prior recorded lien shall 22 include, without limitation, (i) avalidmechanic's lien 23 claim,that is recorded subsequent to the broker's notice of24lien but which relates back to a date prior to the recording25date of the broker's notice of lien and(ii) prior recorded 26 liens securing revolving credit orandfuture advances under 27ofconstruction loans as described in Section 15-1302 of the 28 Code of Civil Procedure, and (iii) prior recorded liens 29 perfected under the Uniform Commercial Code. 30 (Source: P.A. 90-70, eff. 7-8-97.)