In feudal England, real property possession was conveyed through a symbolic act, termed ‘livery of seisin’ (or seizin). Livery of seisin roughly translates to the delivery of possession of land. It could be a lump of soil, a tree branch, or even a fixture of the house. When the grantor passed this symbolic item to the transferee, possession was conveyed.
Although the Illinois Conveyances Act recognized livery of seizin, it provides that this symbolic act in not necessary (765 ILCS 5/1). Instead of passing lumps of soil or tree branches, we currently rely on deeds of conveyance to transfer interest in real property. In Illinois property is routinely transferred by warranty deed or via quit claim deed.
A Warranty Deed transfers title with the grantor’s warranting that title is free of any adverse claims. This includes adverse claims that might have occurred prior to the grantor’s period of ownership.
By conveying via warranty deed, the grantor is basically warranting: (1) that the grantor is the lawful owner of the estate in fee simple and has the right to convey the property to the grantee; (2) that there are no encumbrances (such as a mortgage, lien, lease, etc.); and (3) that there aren’t any adverse claims against the land and title, and if there are then the grantor will defend against those claims. These warranties become part of the conveyance regardless of whether they are expressly stated in the deed. The exact language of the grantor warranties can be found in 765 ILCS 5/9.
A Special Warranty Deed is a deed that limits the warranties. It can be limited to claims that might have occurred during the grantors period of ownership or claims that could have occurred by the grantor. The deed will need to include operative language to the effective limitation(s). Special Warranty Deeds are more common when the grantor acquired the property through a tax sale, foreclosure, or other debt related transfer. In those cases the grantor may limit the warranties to claims by, through or under the grantor. Unlike Warranty Deeds, Quit Claim Deeds provide no warranties as to title, and the grantee takes title subject to any adverse claims.
This blog and any materials available at this web site are for informational purposes and not for the purpose of providing legal advice. You should contact an attorney to obtain advice with respect to any particular issue or problem. Use of and access to this Web site or any of the e-mail links contained within the site do not create an attorney-client relationship between the Law Office Of Christian Blume, LLC or Christian Blume and the user or browser.
Selling a home can be stressful: finding the right agent, determining a listing price, preparing your home for showings, conducting open houses, negotiating offers, etc. Home owners have likely become intimately aware of many of the imperfections and issues of their home. Do those homeowners need to disclose all such issue in their disclosure reports?
Illinois law requires the disclosure of certain defects, not all defects. One disclosure form your real estate agent will likely ask you to complete is the Illinois Residential Real Property Disclosure Statement, which is a requirement, pursuant to the Illinois Residential Real Property Disclosure Act.
What is the Illinois Residential Real Property Disclosure Act?
The Illinois Residential Real Property Disclosure Act (765 ILCS 77/1 et. seq.) requires property transferors (e.g. sellers) to make certain disclosures of material defects. The Act applies to single family homes, multi-family homes (up to 4 units), condominiums, town-homes and co-ops. The Act does not apply to certain types of transfers pursuant to court order and others. An exhaustive list can be found in the statute (765 ILCS 77/15).
When does the Seller complete the IL Real Property Disclosure Statement?
The real estate listing agent may ask the seller to complete the form prior to listing or prior to entering into a written contract. The Act requires the seller to deliver a copy of the disclosure statement to a prospective buyer prior entering into a contract for the purchase and sale of the property (765 ILCS 77/20).
What must be disclosed?
General items of disclosure include issues related to flooding, material defects, and the presence of harmful elements. Areas of concern include: structure, roof, walls, windows, doors, electrical, plumbing, well, heating/air condition/ventilation, septic, sanitary radon, asbestos, lead, termites, and other items (including knowledge of use of the property for the manufacture of methamphetamine). A full list can be found at 765 ILCS 77/35.
*A material defect “means a condition that would have a substantial adverse effect on the value of the residential real property or that would significantly impair the health or safety of future occupants of the residential real property unless the seller reasonably believes that the condition has been corrected.” 765 ILCS 77/35.
Does the Seller have to investigate each specific question when making the disclosures?
No, the Act specifically provides that the seller is not required to investigate or make inquiries into the specific nature of the items in the disclosure report.
What if the buyer is aware of a defect, but the seller failed to disclose the defect on the disclosure statement?
In many residential real estate transfers, a buyer will conduct an inspection during the attorney review and inspection period. The buyer may have the option to declare the contract null and void due to material defects discovered through an inspection. But what if the buyer doesn’t decide to cancel the purchase?
If the seller made the error, inaccuracy or omission with actual notice or knowledge, the Seller is still liable, even if the Buyer later discovers the error. “A seller who knowingly makes a false statement is subject to liability under the Act; no exception is made because of a buyer’s knowledge of the defect.” Woods v. Pence, 708 N.E.2d 563, 303 Ill.App.3d 573, 236 Ill.Dec. 977 (Ill. App. 1999).
This blog and any materials available at this web site are for informational purposes and not for the purpose of providing legal advice. You should contact an attorney to obtain advice with respect to any particular issue or problem. Use of and access to this Web site or any of the e-mail links contained within the site do not create an attorney-client relationship between the Law Office Of Christian Blume, LLC or Christian Blume and the user or browser.
Condominium parking ownership typically falls within one of the following types: deeded space, limited common element or assigned parking. Each form presents different rights to the unit owner or members of the Homeowner’s Association (HOA), and particularly with regards to transferability.
Deeded Space:
A deeded space has its own unique Property Identification Number (PIN), with its own legal description and with a certain percentage of the Condominium Association ownership. The deed can typically be transferred freely, subject to certain condominium rules, and does not necessarily have to be tied to a specific condo unit. Therefore, a condominium owner with a deeded space may decide to sell the space. A deeded space affords the owner the greatest rights for any type of condo parking.
Limited Common Element:
Limited common element parking is similar to a deeded space in terms of ownership, but unlike a deeded space, it is tied to a specific unit and therefore can only be transferred with that unit. Limited common element parking will be either designated to specific units in the original condominium declaration and/or in the listed in the deed of the specific unit. Although transferability is limited, you may be able to lease out the space to other HOA members or third-parties, depending on the rules and regulations.
Assigned Space:
Assigned spaces are not owned by any specific unit owner, rather they are owned by the HOA. In essence they are similar to any other amenity owned by the HOA. They are typically assigned based on the bylaws and rules and regulations. The assignment of the space(s) may come with an additional fee and restrictions on subleasing the space. They are not transferable units of ownership, because they do not belong to any specific unit owner. Therefore, an assignedparking affords owners the least amount of rights.
If you are unsure as to the type of parking you own in your building the first place you should look is the Declaration and Bylaws. When purchasing a condo unit with parking, the contract should specify the type of parking included in the transaction. If you still don’t know you can contact a lawyer to assist.
This blog and any materials available at this web site are for informational purposes and not for the purpose of providing legal advice. You should contact an attorney to obtain advice with respect to any particular issue or problem. Use of and access to this Web site or any of the e-mail links contained within the site do not create an attorney-client relationship between the Law Office Of Christian Blume, LLC or Christian Blume and the user or browser.
What happens when a member of a Limited Liability Company (LLC) wants an interim distribution, but the other members don’t? An issue that may arise in a closely held-business formed as an LLC. LLCs, unlike corporations, are treated as pass-through entities for federal tax purposes, members are taxed based on their interest in the LLC and their proportionate income, whether or not a distribution is made (while it is possible to treat the LLC as a corporation for tax purposes, this is the subject for your CPA or tax adviser to discuss). A member may be allocated income from the company, but may never receive a distribution related to that money. Some members may not be able to pay taxes on money never received and may demand a distribution. This is one of many issues that may arise in a closely held LLC that can be mitigated in advance with a well drafted operating agreement.
When forming an LLC
with multiple members, a well drafted operating agreement is important for
documenting ownership interest and governance of the LLC. The operating agreement, like many contracts,
is used to define the rights and obligations of the parties (members). Illinois does not require specification as to
the ownership interest of each member when filing the Articles of Organization.
Further, Illinois does not require that all members be listed, only members
with management authority.
While there are
numerous rights and obligations that may be outlined in an operating agreement,
this article focuses on rights of distribution, when the company makes a
transfer of money, property or other benefit to a member or a party with the
member’s ‘distributional interest.’
Default Rule (no Operating Agreement):
The default rule, based on the Limited Liability Company Act (805 ILCS 180), is for distributions to be made in equal shares to the members. The Act does not provide for mandatory or compelled distributions to members, except when the company is winding up its business. Many operating agreements may mirror the statutory restrictions on distributions, but may include additional provisions and criteria for distributions.
Time and Consent for Distribution (in Operating
Agreement):
Members may wish to outline the timing and consent for distributions. The Act does not specify a timing mechanism or voting requirement to make a distribution to members. An operating agreement can dictate when a distribution is made to the members of the company and may outline the authorization needed for a distribution, including unanimous or majority consent by all members, or only certain members. The operating agreement can also include requirements for distributions to members when tax liability is incurred.
Restrictions on ‘Distributional Interest’:
Section 15-5 of the Act restricts what may be altered by an operating agreement, including the restriction of the rights of a person, other than a manager, member, and transferee of a member’s ‘distributional interest.’ Since a ‘distributional interest’ is treated as personal property and may be transferred in whole or in part, a member’s ‘distributional interest’ may be used to satisfy a third-party’s (often a creditor’s) claim against the member, without transferring the other rights held by the member. Restricting that third-party’s right to a ‘distributional interest’ in the operating agreement violates the Act.
Additionally, members should be mindful of circumstances when distributions may not be made, regardless of what the operating agreement may state. A Distribution should not be made, when the LLC would not be able to pay its debts as they become due in the ordinary course of business; or when the assets of the LLC would be less than Liabilities and the amount needed to dissolve. Individual members may be liable to the LLC for any amount of distribution that exceeds the amount that could have been distributed without violating the prohibitions on distributions. So even if a distribution is made, but the company is indebted to third-party creditors, the creditors may seek the turnover of those funds from the member.
When forming an LLC
with multiple members, it is important to have a well drafted operating
agreement, which may be worth the time and costs of a lawyer to draft and
review.
This blog and any materials available at this web site are for
informational purposes and not for the purpose of providing legal advice. You
should contact an attorney to obtain advice with respect to any particular
issue or problem. Use of and access to this Web site or any of the e-mail links
contained within the site do not create an attorney-client relationship
between The Law Office Of
Christian Blume, LLC or Christian Blume and the user or
browser.
Not all rental tenancies need be in writing, and many are not. This article will briefly discuss how to properly terminate a month-to-month (M2M) tenancy, one of the more common residential tenancies, when a formal written lease is absent or has since expired by its original terms. In many cases if a written lease is not renewed or extended, and the tenant remains and continues to pay rent on a monthly basis, with the landlord’s permission, a periodic M2M tenancy results, even without any express agreement.
Termination of a M2M tenancy is covered by in the Forcible Entry and Detainer (FED) Act. Notice of termination of a M2M tenancy must be given 30 days prior to the effective termination date. Additionally, the termination date must be at the end of a rental period, which is typically the end of the month. (735 ILCS 5/9-207(b)) For example, if a landlord/tenant wants to terminate the M2M tenancy on November 30, when rent is due the first of every month, notice must be given prior to November 1. If notice is given on November 1, the termination notice won’t be effective until December 31.
Additionally, since there are less than 30 days in February, to terminate a M2M tenancy on February 28, or February 29 (in leap years), you need to provide the notice no later than 30-days prior to that date, which would be by January 29, or January 30 (in leap years).
When computing time for notice purposes, is it important to reference the Statute on Statutes. Specifically, 5 ILCS 70/1.11 provides that when computing time, the first day is excluded and the last day is included, unless the last day is a Saturday, Sunday or a State Holiday, in which case it shall also be excluded. Therefore, if 30 days after the date of notice falls on a Saturday then you must provide for an extra 2 days of notice. It is generally a good idea to error on the side of providing a few extra days of notice, and may also help the Landlord/Tenant receiving the notice, to either find a new tenant or relocate.
Chicago RLTO:
If the property is subject to the Chicago Residential Landlord and Tenant Ordinance (Chicago RLTO), there are separate notice requirements for landlords providing a termination notice. The Chicago RLTO requires notice of 30 days prior to the stated termination date, which applies to month-to-month tenancies and existing rental agreements. A failure to provide the 30 day notice, prior to the termination date, permits the tenant to remain in the unit for up to 60 days after the date of notice, regardless of any existing termination date in any rental agreement. So even if there is an express termination date in a written lease, without proper notice the tenant is permitted to stay beyond that date under the Chicago RLTO. This would likely cause problems if the landlord has already entered into a future lease or plans for the unit.
Service of Notice.
Section 9-211 of the FED Act permits demand or notice to be served by delivering a written (included printed or partially printed) copy thereof to the tenant, or by leaving with some person of the age of 13 years or upwards, residing on or in possession of the premises; or by sending a copy of the notice to the tenant by certified or registered mail, with a return receipt from the addressee. It is important to note that this is different than the requirement to serve notice for demand pursuant to section 9-102 of the Act, which does not permit sending notice via certified or registered mail. It may be helpful to speak with an Attorney regarding the proper methods and contents of the notice.
Effect of giving proper notice.
Tenant still owes the applicable monthly rent for any period in which tenant remains in the unit. The Chicago RLTO states that the rental rate is based on the rental amount in the month immediately preceding the notice, unless that rent was waived or abated, in which case the rent is based on the rate established on the last date that a full rent payment was made. After giving proper notice, if the Tenant fails to vacate the property by the termination notice the landlord may file an action for eviction or ejectment.
If you are unsure about your obligations/rights, or would like to speak with an Attorney, please contact Blume Law.
This blog and any materials available at this web site are for informational purposes and not for the purpose of providing legal advice. You should contact an attorney to obtain advice with respect to any particular issue or problem. Use of and access to this Web site or any of the e-mail links contained within the site do not create an attorney-client relationship between the Law Office Of Christian Blume, LLC or Christian Blume and the user or browser.
Chicago is a City with magnificent trees. We are surrounded by trees; rising high above houses and streets on parkways, living in yards, parks, forest preserves, public lands, on porches, in containers, even in homes. Conifers, deciduous trees, ornamentals, fruit trees. Trees provide both private and public benefits: ascetics, shade, energy savings, temperature control, food consumption, play-things (tree houses, swings), decorations, privacy, noise reduction, air filtration, erosion control, habitats for small animals, and sentimental value. Some have out-survived many buildings, multiple generations, droughts, disease, beetle infestations, and re-development.
While we may not take notice and fully appreciate the lifespan, size and resilience of some of these larger and older trees, we certainly tend to notice when one has been removed, left only by a large stump or a pile of sawdust/woodchips, where a goliath of a tree stood. It can leave a void on our landscape.
What happens when one of those
trees is removed, damaged or reduced in size, more specifically when it is done
without legal right? What is the remedy? How do we value what has been destroyed?
The Wrongful Tree Cutting Act (740 ILCS 185), provides damages for unlawfully removing limbs or trees, such as cutting your neighbors tree down or removing branches from their tree. If you intentionally or knowingly cause to be cut any timber or tree in Illinois, without legal right, you might be liable for monetary damages. Specifically, three-times (3x) the “stumpage value.”
The act was updated in July 2019 (HB3105) and now more precisely defines stumpage value. Prior to the amendment, stumpage value was broadly defined as “standing tree.” Courts were left to determine that value. The trunk formula method was previously used to determine stumpage value. See Marsella v. Shaffer, 324 Ill. App. 3d 134, 257 Ill.Dec. 753 (Ill. App. 2001). The International Society of Arboriculture (ISA) and the Council of Tree and Landscape Appraisers (CTLA) also recognized the trunk formula method as an appropriate method for valuing trees.
Using the trunk formula method an appraiser determines the replacement costs
of the largest locally available tree of the same species and then makes
adjustments for size, condition and location of the tree.
The location adjustment is subjective and can take into account: distance from house/structure, historical or cultural significance, shade factors, aesthetic location, erosion control, noise reduction, barrier to noise or sight (privacy), sentimental value, etc. The condition of the tree is also subjective, and may vary based on the expert making the determination. An expert appraiser can weigh all these factors in determining the stumpage value.
Tree size determination is less
subjective, and calculated based on the cross sectional area of the tree not
the height. A tree’s cross sectional area typically decreases depending on the
measurement location, (1 ft. above ground level for trunks less than 12 inches
in diameter and 4.5 ft. above ground for trees with diameters greater than 12 inches).
New Stumpage Value in
Illinois:
The update to
the Act narrows the definition of “stumpage
value” for purposes of the Wrongful Tree Cutting Act. It is “the
value of timber as it stands uncut in terms of an amount per unit of volume
expressed as dollar value per board foot (board foot = 1 ft. long x 1 ft. wide
x 1 in. thick) for that portion of a
tree or timber deemed merchantable by Illinois forest products markets.”
This definition applies a more commercial approach to determining stumpage value, even though it is applicable to non-commercial trees. It appears that the trunk formula method is no longer applicable, as location is no longer relevant when determining “stumpage value” as to the Wrongful Tree Cutting Act. Although this approach makes the process of computing damages more objective, it may leave tree owners less compensated for their losses and does not take into account the significance of these trees in our daily lives and as structures of our communities.
This blog and any materials available at this web site are for informational purposes and not for the purpose of providing legal advice. You should contact an attorney to obtain advice with respect to any particular issue or problem. Use of and access to this Web site or any of the e-mail links contained within the site do not create an attorney-client relationship between The Law Office Of Christian Blume, LLC and the user or browser.
Illinois, through its legislative branches, recently amended the Limited Liability Company Act (805 ILCS 180) through Senate Bill 1495. Part of the bill was to overrule interpretations of specified portions of the LLC Act set forth in Dass v. Yale, 2013 IL App (1st) 122520, specifically concerning Section 10-10, related to the liability of members and managers.
Dass v. Yalewas the result of an action filed against both an LLC and an individual related to property damage. One issue presented to the Appellate Court was whether Section 10-10 of the LLC ACT exempts LLC members or managers from personal liability for torts or fraud committed in their capacity as members or manages of the LLC. The Court in Dass answered this question in the affirmative, reasoning:
In the case at bar, the plain language of section 10-10 states that, ‘[e]xcept as otherwise provided in subsection (d) of this Section, the debts, obligations, and liabilities of a limited liability company, whether arising in contract, tort, or otherwise, are solely the debts, obligations, and liabilities of the company. A member or manager is not personally liable for a debt, obligation, or liability of the company solely by reason of being or acting as a member or manager.’ 805 ILCS 180/10-10(a) (West 2010). Thus, ‘[s]ection 10-10 clearly indicates that a member or manager of an LLC is not personally liable for debts the company incurs unless each of the provisions in subsection (d) is met.’ Puleo, 368 Ill. App. 3d at 68. Here, there is no claim that [the manager] is liable under subsection (d), so [the manager] is not personally liable for the tort claim against [the LLC].
Dass, 2013 IL App. (1st) 122520 at ¶39.
The interpretation in Dasspermitted individuals acting within their role for an LLC to escape individual liability for tortious conduct. In Dass, the tortious conduct alleged was fraudulent misrepresentations by the Manager of the LLC. The Manager was able to avoid individual liability. The trial court concluded that the language of the Act protected the Manager “since all of the allegations of the complaint occurred while he was acting solely in his capacity as a manager of [the LLC].” The appellate court agreed with the trial courts interpretation.
Senate Bill 1495 corrected the interpretation made in Dass, thus restoring personal liability for tortious acts of an individual, even if acting in his or her capacity as a manager or member of a LLC. Sec. 10-10(a-5) now provides:
Nothing in subsection (a) or subsection (d) limits the personal liability of a member or manager imposed under law other than this Act, including, but not limited to, agency, contract, and tort law. The purpose of this subsection (a-5) is to overrule the interpretation of subsections (a) and (d) set forth in Dass v. Yale, 2013 IL App (1st) 122520, and Carollo v. Irwin, 2011 IL App (1st) 102765, and clarify that under existing law a member or manager of a limited liability company may be liable under law other than this Act for its own wrongful acts or omissions, even when acting or purporting to act on behalf of a limited liability company. This subsection is therefore intended to be applicable to actions with respect to which all timely appeals have not exhausted before the effective date of this amendatory Act of the 101st General Assembly as well as to all actions commenced on or after the effective date of this amendatory Act of the 101st General Assembly.
805 ILCS 180/10-10(a-5).
What does this mean for individuals operating an LLC? You should be aware that you will remain liable for your individual actions, even if acting on behalf of the LLC.
This blog and any materials available at this web site are for
informational purposes and not for the purpose of providing legal advice. You
should contact an attorney to obtain advice with respect to any particular
issue or problem. Use of and access to this Web site or any of the e-mail links
contained within the site do not create an attorney-client relationship
between The Law Office Of
Christian Blume, LLC or Christian Blume and the user or
browser.
Many individuals starting a home-based business may be concerned with listing their home address on public records, for any number of reasons. A recent amendment to the Illinois Assumed Business Name Act, HB2528 carves out an exception for certain businesses to avoid listing their personal residence when personal safety is an issue.
The Assumed Business Name Act (805 ILCS 405) requires any person or persons transacting business under an assumed name (other than their real names) to file a certificate setting for the assumed business name in the county clerk of the county in which business is transacted. The types of businesses that are required to register assumed business names include, sole proprietorships, general partnerships, and professional services corporations. It does not require corporations, limited liability companies (LLC), or limited liability partnerships (LLP) to register their assumed name.
An assumed business name is any name other than that of the
individual owner(s) of the business. Example: Abraham Lincoln, P.C. would not
need to register as an assumed name, but Lincoln Law would since it is not the
actual name of the individual transacting the business as a professional
corporation.
In August 2019, the Assumed Business Name Act was amended, to
add 805 ILCS 405/1a, effective January 1, 2020.
The amendment permits a person or persons transacting business under an
assumed name at his or her personal residence, to list the county clerk as the
default agent for service if listing their home address would put their safety
at risk. Certain conditions must be met
in order to list the county clerk.
The person reasonably believe that publishing
his or her home address would put his or her safety at risk, and lists the
reasons for that belief on a form submitted to county clerk, which shall be
kept confidential;
The form is accompanied by a court order or
police report;
The person provides the address of his or her
residence to the county clerk, which shall be kept confidential.
The amendment further stipulates that the county clerk has a
duty to notify the business of service of process on behalf of the business,
and may charge a nominal fee for this service.
Therefore, effectuating service on an individual or individuals
operating under an assumed name can be accomplished through the county clerk,
like serving any other registered agent.
Whether the individual(s) receive(s) actual notice from the county clerk
would not matter for purposes of jurisdiction, although this hasn’t been
tested.
Lastly, the act does not list what the court order or police report must state in order, and leaves this question open for interpretation. Must the police report or court order confirm there is a reasonable risk of safety for listing the home address?
This blog and any materials available at this web site are for informational purposes and not for the purpose of providing legal advice. You should contact an attorney to obtain advice with respect to any particular issue or problem. The information in this article is current as of the date indicated, and may not be updated to reflect future changes/developments. Use of and access to this Web site or any of the e-mail links contained within the site do not create an attorney-client relationship between the Law Office Of Christian Blume, LLC or Christian Blume and the user or browser.
The other day, while finishing off my coffee a donut and a
couple donut holes with jimmies (look that one up) at one of the local donut
shops near my office, I overheard the donut shop worker talking with a bike
messenger about a bird stuck in the donut shop.
My initial thought…this sounds like a job for a tall guy,
like changing light bulbs, pulling down projector screens, or reaching objects
from high places, reminiscent of my high school teachers’ requests. I know makes tall people feel special.
So I inquired to ask what was going on. The worker said they were closed, while she
was attempting to get the bird out from above the door, with a donut on a stick
and with the bike messenger’s assistance.
Yeah that’s right, a donut on end of a stick, as if the bird was only
there for a snack, maybe it was. I offered
to grab the distressed bird and the worker looked at me with confusion.
In attempt to sweep the bird down, it flew across the store
and eventually ended up landing in an empty donut box before flying to hide
behind some coffee cups. I asked the worker
if I could go behind the counter to get the bird out, while she consented. Through multiple attempts and without harming
the little bird, I was able to trap it using two plastic coffee cups. I took it outside, a few yards from the door,
and released it. It flew away unscathed.
Here’s where it gets interesting, after thanks, the woman
working the store proclaimed “free donuts for life” and told me to come in the
following day, when they were re-opened.
Wrong person to offer free donuts for life to, especially the good
donuts (you know what I mean if you live in Chicago and appreciate donuts).
So am I to expect free donuts for life? Does the shop owe me free donuts for life? Short answer is probably not.
This promise of “free donuts for life” can be looked at through contract law (i.e. whether we have an enforceable contract), specifically under Illinois contract law. A contract requires mutual assent, by the parties to the terms of the agreement; the parties here being the donut business (assuming the worker had authority to bind the donut shop, without getting into agency law) and myself. Mutual assent requires a “meeting of the minds” and typically includes an offer and acceptance. Both parties must understand and accept the agreement they are entering into. In addition to mutual assent there must be “consideration”, which is a bargained-for promise, act, or forbearance or the creation, modification, or destruction of a legal relation.
However, past consideration is not sufficient
consideration to form an agreement, and would be treated as a gratuitous
promise. Which means since I had already
provided the removal of the bird from the donut shop (performance and past
consideration), the shop’s promise of “free donuts for life” was based on a
prior conferred benefit, and not sufficient to form consideration for the
promise. Had the worker stated “if you
get that bird out of here, you will get free donuts for life”, or “whoever gets
the bird out of here gets free donuts for life” and I performed, this would
satisfy the consideration element of a contract, but not the case here.
I asked a lawyer friend to discuss and although willing to
take my case for a third of the donuts, we both concluded that there was no
exchange of consideration, “free donuts for life” for past performance was not
enough. But he did bring up the legal
doctrine of promissory estoppel, based on the gratuitous promise of the donut
shop.
“The restatement of
contracts defines promissory estoppel as “A
promise which the promisor should reasonably expect to induce action or
forbearance of a definite and substantial character on the part of the promisee
and which does induce such action or forbearance is binding if injustice can be
avoided only by enforcement of the promise.”
Illinois requires the following elements to set out a claim for
promissory estoppel: (1) there is a promise that is unambiguous in its terms;
(2) there is reliance by the party to whom the promise is made; (3) the
reliance is expected and foreseeable by the party making the promise; and (4)
the party to whom the promise is made relies on the promise to his or her
detriment. These are all factual
questions that must be established, and will hinge on the specifics of each
case.
Applying these elements to the bird rescue and “free donuts
for life”, one could argue the promise was ambiguous. What does “free donuts for life” mean? A donut
a day or a dozen? It’s not clear, what the
shop was promising, and what the promissee (myself) may be interepreting the
promise to be, and this creates ambiguity. However, a jury or judge may be able to
determine what “free donuts for life” means, and give it more definite meaning.
Second, I would have had to rely on this promise, and in
Illinois that reliance must be reasonable. Let’s say I did rely on this promise and
showed up every day to ask for a donut and let’s assume this was reasonable,
that would satisfy the second element.
The third element also requires reasonableness, and it would
have to be reasonable for the donut shop worker to expect and foresee me rely
on this promise; again for a judge or jury to decide.
The fourth element, detrimental reliance, may be shown
through my efforts in showing up at the donut shop day after day to receive my
free donut, but it would be unreasonable for me to continue to show up, if
after the first day I was told I only get one free donut and cannot continue to
come back for free donuts.
Let’s say I overcome these hurdles and prevail on a claim
under the doctrine of promissory estoppel, what could I recover in damages? Some courts have awarded actual damages (i.e.
the detriment of the reliance) others have awarded the promise, “free donuts
for life,” so long as necessary for equity to prevail.
Free Donuts for Life.
*Although I am a consumer of delicious donuts, I am also a business and real estate lawyer and would be happy to speak with you and see how I can be of assistance with your start-up or small business. Christian@attorneyblume.com
The prosecution of ordinance violations can take place at the City of Chicago Department of Administrative Hearings (DOAH), located at 400 W. Superior. DOAH acts as a ‘quasi-judicial body.’ Cases are heard by licensed attorneys, paid for and contracted with the City of Chicago, and commonly referred to as Administrative Law Judges (or ALJs). These cases are typically shorter than other litigation, often times, one hearing. The result can be anywhere from a dismissal of the charges to a substantial fine. Read More Here.
If you failed to appear and present your case to the ALJ, a default
judgment may have been entered against you, and your first option may be to
file a motion to set-aside the default motion.
This motion generally must be filed within 21 days of the mailing date
stamped on top of the default judgment order (the time limit may not apply
under certain circumstances). The motion
should be filed in person at 400 W. Superior, and you must appear or have an
attorney appear on the date the motion is scheduled.
If you did appear and contest the charges against you, and a
judgment that was entered that was not in conformity of the law, or the ALJ didn’t
consider the requisite facts, you may want to appeal the decision.
You do have a right to appeal the decision of the ALJ to a
Circuit Judge. Pursuant to 735 ILCS
5/3-104, jurisdiction to review final administrative decisions is vested in the
Circuit Courts. Unlike ALJs, the Circuit
Court is made up of full-time judges, elected or appointed, who are not paid by
the City of Chicago.
The process for appealing and Administrative Law Decision
After your hearing at the DOAH, you will likely be given a
copy of the “Findings, Decisions & Order”.
Pursuant to 735 ILCS 5/3-103 “Every
action to review a final administrative decision shall be commenced by the
filing of a complaint and the issuance of summons within 35 days from the date
that a copy of the decision sought to be reviewed was served upon the party
affected by the decision…” So if you are
given a copy of the final determination of the ALJ, this would be the start of
the 35 day time limit to file your appeal.
If you fail to attend the hearing or otherwise do not receive a copy of
the final order from the ALJ, the 35 day period will start when the Findings,
Decisions & Order is mailed.
There is a fee for filing your appeal, and the appeal can be
filed in room 602 of the Richard J. Daley Center, 50 W Washington St., Chicago,
IL, or electronically. When the
Complaint is filed a court date will be given, typically at least a few weeks
in the future.
The summons is the form notifying the City and the Specific
City Department(s) that an administrative review has been filed and the date of
the first hearing. You must mail a copy
of the Summons, Complaint and Cover Sheet to each applicable City Department,
as well as the City of Chicago Department of Law and the City of Chicago
Department of Administrative Hearings.
At the first court date, the Judge will call your case. The City will appear and request time to
respond to your complaint. The City will
likely be granted time to file its answer to your complaint, or “the record”,
which includes a transcript of your administrative hearing and all the evidence
used by the City in prosecuting your case.
The Judge will permit you time to
file what’s called “Specification
of Errors” form. The “Specification
of Errors” is the reasons and your argument as to why the Administrative Hearing
Officer (ALJ) was wrong. The Judge will
set the next court date and time.
The Specification of Errors will need to be filed after your
receive the City’s answer. You will need
to mail a copy of the Specification of Errors to the City, as well as file a
copy with the Court.
The next Court date, the judge (who may be a different judge than the one on your first court date) will permit both you and the City to present your arguments. The Judge will make a ruling on this date.
*Christian is an Illinois lawyer who assists property owners facing ordinance violationshome owners (or future home owners) with real estate transactions, and small businesses. Call (773-706-7514) or email (christian@attorneyblume.com).
This blog and any materials available at this web site are for informational purposes and not for the purpose of providing legal advice. You should contact an attorney to obtain advice with respect to any particular issue or problem. Use of and access to this Web site or any of the e-mail links contained within the site do not create an attorney-client relationship between the Law Office Of Christian Blume, LLC or Christian Blume and the user or browser.
