Recouping Attorney’s fees in Condominium Disputes
Suing an Association is an expensive proposition in Illinois. Illinois follows the American Rule regarding assessing attorneys fees. The American Rule is unless there is a statute or contract stating otherwise, each side pays their own legal fees. So if an unit owner prevails in litigation against the Association, most times the unit owner needs to pay one’s own attorneys fees and also one’s pro rata share of the Association’s attorney’s fees in the litigation. Other states such as Florida make the Association pay the unit owner’s legal fees if the unit owner prevailed.
This is unfair. In 2016 the Chicago Tribune and the Loop North News published articles about a bill introduced into the Illinois Legislature seeking to even the playing field by requiring the Association– if they lose in court– pay the unit owner’s legal fees. A copy of this proposed law is attached. Unfortunately this bill did not pass: it didn’t even get out of committee.
What is the aggrieved unit owner to do except to fight on realizing this hazard. Since Board members must be elected every year maybe the Association’s political process will help. If that will not alleviate the situation then realize the legal fees will escalate as another blogger stated: Litigation is too Darn Expensive.
An exception to this general rule is when the Association fails to provide financial records and other documents to the unit owner. When this occurs, then the unit owner may recoup one’s attorney’s fees from the Association. An example is Palm v 2800 Lake Shore Drive Condominium Association 2013 IL 110505. Another exception to this rule exists if the condominium declaration allows for a unit owner to recoup their attorney’s fees from the Association. I have only seen this provision in a handful of cases.
Of course when Associations sue unit owners, the outcome is different: state statutes and most condominium declarations require unit owners normally pay to the Association the attorney’s fees the Association spent in litigating against them. So if the Association prevails in disputes over unpaid assessments, unpaid fines, or violations of the condominium declaration, then the Association will recoup 100% of its legal fees against the unit owner.
This is unfair.