Board of Managers of the Inverrary Condominium Ass'n v. Karaganis
2017 IL App (2d) 160271
Ill. App. Ct.2017Background
- Karaganis owned a condo unit and the association sued under the Forcible Entry and Detainer Act (735 ILCS 5/9-101 et seq.) for unpaid assessments and sought possession plus money judgment including attorney fees. Parties stipulated defendant owed roughly $8,154.75.
- Karaganis counterclaimed for water-damage caused by the association’s alleged failure to maintain common elements and raised affirmative defenses arguing assessments were offset by association breaches.
- While litigation proceeded, the Illinois Supreme Court decided Spanish Court Two Condominium Ass’n v. Carlson, which held an association’s failure to maintain common elements is not a defense in forcible entry proceedings. The Carlson decision reversed earlier appellate precedent that Karaganis had relied on.
- At trial the court awarded the association possession (stayed), an in personam and in rem money judgment for unpaid assessments, and $23,300 in attorney fees (reduced from the $48,835 requested). Karaganis sought sanctions for a purportedly false discovery-compliance affidavit.
- The trial court denied sanctions, found the affidavit misleading but not in bad faith, and concluded the Carlson rule barred Karaganis’s affirmative defenses from being considered in awarding fees. Karaganis appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a §9-111(a) judgment for unpaid assessments is enforceable personally (beyond possession or leasing the unit) | Association: §9-111(a) authorizes a money judgment separate from possession and any lawful collection remedies; money judgments are not stayed | Karaganis: Remedy limited to possession; association may only wait for owner payment or lease unit and apply rents | Court: §9-111(a) plainly authorizes money judgments and does not limit collection methods; associations may use lawful remedies to enforce money judgments (in personam enforcement permitted) |
| Whether affirmative defenses about association’s failure to maintain common elements may be considered in awarding attorney fees under §9-111(b)(iv) | Association: Fee award governed by §9-111(b) factors; defenses about common-elements are not germane and therefore not part of “nature of the action” | Karaganis: Court should consider that he reasonably withheld assessments pre-Carlson and other defenses when assessing reasonableness and nature of the action | Court: Carlson bars such defenses as not germane; trial court properly excluded them from §9-111(b)(iv) analysis |
| Whether the fee award ($23,300) was unreasonable | Association: Trial court closely scrutinized and reduced requested fees; award reasonable | Karaganis: Fees should be reduced due to association’s conduct and lack of supervision of counsel | Court: Having rejected the relevance of the affirmative defenses, and given the trial court’s detailed review and substantial reduction, the award was reasonable; no reversible error shown |
| Whether sanctions were warranted for a false discovery-compliance affidavit | Association: Affidavit was made in good faith and any misleading language did not prejudice defendant | Karaganis: Affidavit was false and documents (work orders) were withheld; sanctions (including barring fees) warranted | Court: Trial court did not abuse discretion; affidavit misleading but no evidence of bad faith or prejudice substantial enough to warrant sanctions |
Key Cases Cited
- Spanish Court Two Condominium Ass’n v. Carlson, 2014 IL 115342 (Ill. 2014) (association’s failure to maintain common elements is not a defense in forcible entry and detainer proceedings)
- Knolls Condominium Ass’n v. Harms, 202 Ill. 2d 450 (Ill. 2002) (discusses remedies and collection options in condominium contexts)
- Heastie v. Roberts, 226 Ill. 2d 515 (Ill. 2007) (supreme-court decisions apply retroactively to pending cases)
- Weather-Tite, Inc. v. University of St. Francis, 233 Ill. 2d 385 (Ill. 2009) (statutory construction—courts must give effect to plain language and avoid reading in limitations)