Granville Tower Condo. Ass'n v. Escobar

2022 IL App (1st) 200362

204 N.E.3d 873

461 Ill.Dec. 537

GRANVILLE TOWER CONDOMINIUM ASSOCIATION, an Illinois Not-For-Profit Corporation, Plaintiff and Counterdefendant-Appellee,

v.Hilda ESCOBAR and All Unknown Occupants, Defendants

(Hilda Escobar, Defendant and Counterplaintiff-Appellant).

No. 1-20-0362

Appellate Court of Illinois, First District, SECOND DIVISION.

Filed January 25, 2022

John Cloutier, Cloutier Law Group, of Chicago, for appellant.

Gabriella R. Comstock, of Keough & Moody, P.C., of Naperville, for appellee.

PRESIDING JUSTICE FITZGERALD SMITH delivered the judgment of the court, with opinion.

¶ 1 The defendant and counterplaintiff, Hilda Escobar, appeals various rulings in a bench trial that resulted in a judgment in favor of the plaintiff and counterdefendant, Granville Tower Condominium Association on the association's claims for possession of a condominium unit and for unpaid assessments and on Escobar's counterclaims for declaratory judgment, breach of fiduciary duty, and breach of contract. We affirm the trial court's judgment.

¶ 2 I. BACKGROUND

¶ 3 On December 27, 2010, the association's board of directors passed a resolution adopting a special assessment in the amount of $4.15 million to be levied upon the owners of all condominium units within the association according to their percentage of ownership. That resolution provided that 100% of each unit owner's proportionate share of the special assessment "shall be deemed to be fully and completely assessed." It then went on to provide:

"Notwithstanding any financing taken by the Association or any payment arrangements which may be entered into, the Unit Owners of the Association will be deemed financially responsible for One Hundred Percent (100%) of said Special Assessment at the time it is levied. Should any Unit Owner of the Association fail to timely pay said Special Assessment, in accordance with any financing taken by the Association or payment arrangements which may be entered into, or default in any other responsibilities, the entire unpaid balance of said Special Assessment and all other unpaid assessments, fees, and/or costs, shall be deemed immediately due and owing."

¶ 4 At the time that the special assessment was levied, the owner of unit 20G was Ana Cruz. A ledger admitted into evidence at trial indicated that, following the levying of the special assessment, Cruz made payments of $31.51 per month toward the special assessment each month in 2011. In 2012, this amount increased to $64.22 per month, and Cruz made those payments. In 2013, the monthly payment due under the special assessment increased to $73.82. Cruz made a payment only for the month of January 2013 and thereafter ceased making any payments of the regular monthly assessment or special assessment due for unit 20G. On June 7, 2013, the association filed suit against Cruz for the unpaid assessments and ultimately obtained a money judgment against her in the amount of $3867.47 and an order of possession for unit 20G.

¶ 5 Separately, a complaint for foreclosure was later filed against Cruz by her mortgage company. The association was named as a defendant in that suit. Hilda Escobar was the high bidder at the court-ordered foreclosure auction held on June 27, 2014. The sale was confirmed by the court on September 2, 2014. On July 15, 2014, Escobar made her first payment of regular and special assessments on unit 20G, in the amount of $834.96.

¶ 6 Thereafter, Escobar received a letter dated September 17, 2014, sent on behalf of the association by its property manager, Marla Stiefel. According to that letter, $36,808.55 in assessments and other charges were due to the association on the account for unit 20G at the time of closing. The letter stated that this sum comprised (1) $834.97 for the "[b]alance," (2) $23,529.14 for the special assessment, and (3) $12,444.44 as the "Amount Due from Prior Owner Account." Escobar disagreed that she owed the full amounts set forth in the letter.

¶ 7 By June 2015, Escobar was seeking to sell unit 20G, and for that purpose, she obtained a paid-assessment letter from the association. That paid-assessment letter stated that upon closing a total of $34,164.49 would be due to the association. It stated that this sum comprised (1) $787.61 for the balance due from the seller as of June 30, 2015, (2) $22,378.92 for the "Special Assessment thru 01/14/23," (3) $10,932.96 for the "[a]mount due from third party purchaser," and (4) $65.00 as a transfer fee to the property management company.

¶ 8 It is undisputed that Escobar made no further payments of assessments for unit 20G after June 15, 2015. On August 22, 2017, the association filed the suit against Escobar that is the subject of this appeal. In that suit, the association sought recovery of the unpaid assessments and possession of her condominium unit. The suit was filed in forcible entry and detainer court.¹

¶ 9 On October 20, 2017, Escobar filed a separate suit against the association in the chancery division of the circuit court. In the first count of her complaint in that case, Escobar sought a declaratory judgment that, pursuant to the applicable provisions of section 9(g) of the Condominium Property Act ( 765 ILCS 605/9(g) (West 2016)), Escobar (1) did not owe any monies left unpaid by Cruz, (2) the entirety of the 2010 special assessment was due and had become part of the association's lien under section 9(g)(1) (id. § 9(g)(1)) as of the time of the judgment in the foreclosure suit against Cruz, and (3) therefore, as Escobar had paid six months’ worth of preforeclosure assessments as required by section 9(g)(3) (id. § 9(g)(3)), Escobar owed no further money to the association for the special assessment. The second count of the complaint alleged that the association had breached its fiduciary duty to Escobar by demanding that she pay amounts owed by Cruz and amounts that it alleged were due for the special assessment, which had been "wiped off the property" by the foreclosure sale and the payment of the preforeclosure assessments. Escobar alleged that the association's breach of fiduciary duty had prevented her from being able to sell unit 20G and to instead incur all the costs of ownership. Finally, the third count alleged that the same actions by the association resulted in a breach of the association's declaration and bylaws causing essentially the same damages. That count also alleged that the association had "intentionally interfered with and caused the breach of the contract by Escobar."

¶ 10 On May 16, 2018, the assignment judge of the law division granted Escobar's motion to consolidate the two cases. Although Escobar had argued that, because of the limited jurisdiction of the forcible entry and detainer court, the cases should be consolidated in the chancery division, the assignment judge ordered that the consolidated case would pend in the forcible entry and detainer section.

¶ 11 The case ultimately proceeded to bench trial in November 2019. Prior to trial, the trial court granted an emergency motion filed by the association to quash a notice issued by the plaintiff pursuant to Illinois Supreme Court Rule 237 (eff. July 1, 2005). The trial court also denied a motion in limine filed by Escobar to bar the testimony of Brian Kelly, who is a senior supervisor for the new property management company retained by the association about five months prior to the trial.

¶ 12 Kelly testified at trial that, in his role as senior supervisor for the association's property management company, he had access to and was familiar with the books and records of the association. He identified the declarations for the condominium association and testified that they called for assessments to be collected from unit owners on a monthly basis. They also authorized late fees, interest, attorney fees, and court costs to be collected from unit owners who failed to make timely payments. He identified a ledger kept on behalf of the association showing assessment payments made by Escobar between July 2014 and November 2019, and he testified that it reflected that the association had not received any payments of assessments by Escobar since June 15, 2015. He identified the minutes of the meeting of the association's board of directors on December 27, 2010, and testified that the association had at that time adopted a special assessment in the amount of $4.15 million, assessed against each of the unit owners based upon their percentage of ownership. It also provided that the association would obtain a loan to make financing available to the owners. He testified that the association was seeking to collect special assessments from Escobar. Kelly testified that the association was seeking to collect from Escobar the unpaid regular and special assessments from July 15, 2014, to the present and that it was not seeking to collect any amounts from Escobar that came due while Cruz was the owner of the unit. Kelly also testified that the association was seeking to collect late fees, interest, attorney fees incurred in the collection action, and the possession of unit 20G.

¶ 13 On cross-examination, Kelly identified the association's account ledger for unit 20G as of the time Escobar had purchased the unit. He testified that the balance owed on the unit as of the end of June 2014 was $12,677.53. He testified that this amount was owed by Cruz and was her debt. He testified that Escobar had made payments of $834.96 in July 2014, $884.95 in August 2014, $528.60 and $3171.60 in October 2014, $528.60 in November and December 2014, and then $586.69 each month from January through June 2015. He testified that, prior to Escobar's purchase, the association had obtained possession of the unit from Cruz and had rented it out at a rate of $1025 per month for seven months. He identified the association's letter sent to Escobar dated September 17, 2014. He stated that the $834.97 balance shown on it would be for the regular and special...