Transactional

Jacob Shapiro and Justin Strane Named to the 2018 Illinois Rising Stars List

We are pleased to announced that Jacob Shapiro and Justin Strane have been selected to the 2018 Illinois Rising Stars list. This marks the second consecutive year Jacob and Justin have been selected to the Rising Stars list. Each year, no more than 2.5 percent of the lawyers in the state are selected by the research team at Super Lawyers to receive this honor.

Super Lawyers, part of Thomson Reuters, is a research-driven, peer influenced rating service of outstanding lawyers who have attained a high degree of peer recognition and professional achievement. Attorneys are selected from more than 70 practice areas and all firm sizes, assuring a credible and relevant annual list.

The annual selections are made using a patented multiphase process that includes:

  • Peer nominations
  • Independent research by Super Lawyers
  • Evaluations from a highly credentialed panel of attorneys

The objective of Super Lawyers is to create a credible, comprehensive and diverse listing of exceptional attorneys to be used as a resource for both referring attorneys and consumers seeking legal counsel.

The Super Lawyers lists are published nationwide in Super Lawyers Magazines and in leading city and regional magazines and newspapers across the country, as well as the Illinois Super Lawyers Digital Magazine.

For more information about Super Lawyers, go to SuperLawyers.com.

Chicago Property Tax Rebate Program - Applications Due by November 30, 2016

This past year, Chicago homeowners saw their property tax bills increase by an average of 13%.  Because of this, the City of Chicago developed a program to provide homeowners with some relief. Chicago's Property Tax Rebate Program is currently accepting applications.

Standard rebate amounts range between $25 and $200. The City calculates rebate amounts based upon household income and increases in the Chicago portion of a homeowners’ property tax bill.

26 neighborhood locations and City Hall accept applications. Homeowners will receive rebate checks 6 to 8 weeks after application processing. The deadline to apply is November 30, 2016.

Eligibility requirements for the Chicago Property Tax Rebate Program are as follows:

·         Chicago Resident and Homeowner;

·         Received the Homeowner’s Exemption in the most recent property tax year;

·         Household adjusted gross income of $75,000 or less in 2015;

·         City of Chicago portion of property taxes increased on most recent tax bill;

·         Homeowner is current on payment of property taxes;

·         Homeowner does not owe real estate taxes on other property located in Chicago; and

·         Homeowner does not owe other City debt (e.g., parking tickets, overdue water bills). Homeowners owing other debt may still apply; however, the City will apply rebate amounts to the outstanding debt.

Senior supplement and enhanced grant programs are also available for qualifying homeowners.

For complete information, including locations accepting applications, please visit:

Chicago Property Tax Rebate Program

or call our offices for further questions or assistance.

New ALTA Survey Standards Effective February 23, 2016

Changes to the American Land Title Association/American Congress on Surveying and Mapping survey (commonly referred to as an ALTA/ACSM Survey in contracts) standard details requirements go into effect on February 23, 2016. This is an important change that individuals and businesses involved in commercial real estate transactions must be aware of.

ALTA Surveys are important to commercial real estate transactions because they will be required by title companies to insure title to land without exception to the extent such is possible. ALTA Surveys assist in discovering matters that might not be evidenced by the public records.

Parties to a commercial real estate contract should make sure that the contract language refers to the proper survey. Under the 2016 standards, the survey is now referred to as an “ALTA/NSPS Land Title Survey.” NSPS (National Society of Professional Surveyors) is the legal successor organization to the ACSM. Thus, contract language should make certain to correctly reference the required survey. Likewise, the contract should specify that the 2016 minimum standard detail requirements are required to avoid any confusion or room for contradicting interpretations.

Drafting and negotiating your commercial real estate contract to accommodate this change will help avoid potential misunderstandings or errors due to vagueness in contract language. Doing so may prevent costly mistakes such as ordering an incorrect initial survey and then being forced to order a second, more expensive ALTA Survey. Such an error could also impact contract deadlines and raise the risk of a contractual default.

Purchasers of Properties that have gone through Judicial Sales Should be Cautious

Adam M. Ansari's article, "Purchasers of properties that have gone through judicial sale should be cautious", was originally included in the December 2015 Illinois State Bar Association's Section on Real Estate Law Section newsletter, and republished in the Commercial Banking, Collections, and Bankruptcy Section. Please click here to review the original publication. 

The Illinois Appellate Court in Concord Air, Inc. v. Malarz, 2015 IL App (2d) 140639 has increased the due diligence necessary for properties that have gone through a foreclosure sale.

Modified on the denial of rehearing, on October 15, 2015, the Illinois Appellate Court posted its ruling in Concord Air, Inc. v. Malarz, 2015 IL App (2d) 140639. The case arose after Harris Bank filed a foreclosure action (Harris foreclosure) against a home in Lake Forest, Illinois, and named the borrower and Concord Air, Inc. (Concord Air) as a defendant/junior lienholder. Concord, at ¶ 1. Concord Air defaulted, and Harris Bank was the successful bidder at the judicial sale and the trial court confirmed the sale. Id. Thereafter, Chicago Title, as trustee for a land trust (Chicago Title), relying on a title report, which indicated Concord Air’s interest had been extinguished by the Harris foreclosure, purchased the subject property.

A little less than a year later, upon learning of the foreclosure proceeding and the default entered against it, Concord Air moved to quash service for a lack of personal jurisdiction. The trial court vacated the judgment of foreclosure as to Concord Air only and left intact the order approving sale. Concord Air then initiated its own foreclosure action (Concord foreclosure) against the subject property. Chicago Title responded with a Motion to Dismiss arguing bona fide purchaser status. The trial court agreed with Chicago Title and additionally cited the public policy of finality and stability of judicial sales as a basis for its decision. Concord, at ¶ 48.

On appeal, Concord Air argued that Chicago Title was on inquiry notice of the lack of jurisdiction, because the affidavits on the record at the time Chicago Title purchased the property, indicated service was attempted only once, at an address other than the registered agent's, and by a different process server than the one listed on the affidavit of due diligence. Concord, at ¶ 40. Concord Air identified potential noncompliance with Sec. 2-206 and Sec. 2-202 of the ILCS in support of its argument. Concord, at ¶ 40. The Appellate Court agreed with Concord Air concluding that Chicago Title was on inquiry notice of Concord Air’s potential outstanding interest, as the defect in personal jurisdiction over Concord Air was apparent on the face of the Harris foreclosure record.

In addition to its bona fide purchaser argument, Chicago Title argued that because Concord Air was a junior lienholder and not a prior borrower or owner of the subject property, Concord Air should not be allowed to pursue a claim against the property itself, and Concord Air’s requested relief should be limited to the proceeds of the foreclosure sale. Concord, at ¶ 49. In response, the Appellate Court opinioned that the judicial sale did not result in a surplus and therefore the value of the property, roughly $1.7 million, and the status of the Harris foreclosure required a balancing of the equities on remand. Concord, at ¶ 50.

Transactional Attorneys Beware

Although difficult to glean from the Appellate Court’s opinion, the holding places a significant burden on real estate purchasers interested in properties that have gone through a judicial sale.

Regardless of the number of years or the number of times a piece of property has exchanged hands, purchasers and their attorneys are considered to be on constructive notice of potential jurisdictional defects in a foreclosure record, irrespective of whether the defect concerns a prior owner or a junior lienholder. Now, beyond a review of the title commitment, transactional attorneys are expected to obtain and review the foreclosure record before blessing the purchase of an affected property. This is especially onerous in light of the time, money, and effort needed to acquire a foreclosure record, not to mention the expertise needed to actually identify the potential jurisdictional defect once the record is obtained.

Although the newly enacted Sec. 15-1603.5 may provide a statutory framework for extinguishing a subordinate interest when that interest was not named in the original foreclosure action, it remains to be seen whether the code section, enacted August 26, 2014, will be applied to situations where a junior lienholder was named in the foreclosure, but jurisdiction was nonetheless found to be improper.

With the minimal fees, the time constraints placed on attorney review, and the prospect of more junior lienholders filing similar actions as Concord, some attorneys may begin thinking twice about their willingness to be retained on residential transactions with a prior foreclosure.