Holtgren v. 260 Jamie Lane Condominium Assoc. ( 2022 )

2022 IL App (2d) 210440-UNo. 2-21-0440
Order filed May 9, 2022
NOTICE: This order was filed under Supreme Court Rule 23(b) and is not precedent
except in the limited circumstances allowed under Rule 23(e)(1).
______________________________________________________________________________
IN THE
APPELLATE COURT OF ILLINOIS
SECOND DISTRICT
______________________________________________________________________________
FREDRIC J. HOLTGREN, ) Appeal from the Circuit Court
) of Lake County.
Plaintiff-Appellant, )
)
v. ) No. 19-MR-1156
)
260 JAMIE LANE CONDOMINIUM )
ASSOCIATION and UNKNOWN OFFICERS )
AND DIRECTORS, ) Honorable
) Mitchell L. Hoffman,
Defendants-Appellees. ) Judge, Presiding.
______________________________________________________________________________
JUSTICE BRENNAN delivered the judgment of the court.
Justices Zenoff and Jorgensen concurred in the judgment.
ORDER
¶1 Held: The trial court did not err in granting defendants’ motion to dismiss plaintiff’s
second amended complaint for failure to state a claim for declaratory relief from
imposition of assessments on four undeveloped condominium units. Affirmed.
¶2 Plaintiff, Fredric J. Holtgren, sued defendants, 260 Jamie Lane Condominium Association
and unknown officers and directors (collectively the association), for a declaratory judgment that
he was not liable for assessments on four undeveloped condominium units that he owned. The trial
court granted the association’s motion to dismiss the operative complaint with prejudice. For the
reasons set forth below, we affirm.
2022 IL App (2d) 210440-U¶3 I. BACKGROUND
¶4 Holtgren is a real estate developer. In early 2001, as the owner and developer of the subject
property, Holtgren drafted, executed, and recorded an “Easements, Restrictions And Covenants
For 260 Jamie Lane Condominiums And Declaration Of By-Laws For The 260 Jamie Lane
Condominium Association” (declaration) pursuant to the provisions of the Condominium Property
Act (Act) (765 ILCS 605/1 et seq. (West 2018)). We recount the relevant portions of the Act and
declaration as well as the procedural history.
¶5 A. Act and Declaration
¶6 The Act provides for the submission of a property to its provisions by “recording a
declaration, duly executed and acknowledged, expressly stating such intent and setting forth the
particulars enumerated in Section 4 [specifying the requisite content of the declaration].” Id. § 4.
Any provisions in the declaration that are inconsistent with the Act “are void as against public
policy and ineffective.” Id. § 2.1. In accordance with the statutory requirements, the declaration
here sets forth the legal description of the property, commonly known as 260 Jamie Lane, located
in an industrial area of Wauconda. The declaration further provides that the property is “improved
with a nine (9) unit commercial/industrial building.” The intent of the declaration is set forth in
sections B, C, and D of the recitals, respectively, as follows:
B. “The Owner desires and intends by this Declaration to submit the Property
(as herein defined) to the provisions of the Condominium Property Act of the State of
Illinois, as amended from time to time,
C. The Owner further desires and intends, by this Declaration, to establish for
its own benefit and for the benefit of all future owners and occupants of the Property, and
each part thereof, certain easements and rights in, over and upon the Property and certain
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2022 IL App (2d) 210440-Umutually beneficial restrictions and obligations with respect to the use and maintenance
thereof,
D. The Owner desires and intends, by this Declaration, to declare that the
owners, mortgagees, occupants and other persons acquiring any interest in the Property
shall, at all times, enjoy the benefits of and shall, at all times, hold their interests subject to
the rights, easements, privileges and restrictions hereinafter set forth all of which are
declared to be in furtherance of a plan to promote and protect the cooperative aspect of
ownership, and to facilitate the proper administration of the Property and are established
for the purpose of enhancing and perfecting the value, desirability and attractiveness of the
Property.”
¶7 Article I of the declaration, entitled “Definitions,” sets forth definitions of “unit,” “unit
owner,” “common elements,” and “common expenses.” “Unit” means “a part of the property
designated and intended for any type of independent use.” A “unit owner” is defined as “the person
or persons whose estates or interests individually or collectively, aggregate fee simple absolute
ownership of a Unit.” “Common elements” means “all portions of the Property, except the units,
including the Limited Common Elements [those designated in the declaration or plat of survey as
being reserved for the use of a certain unit or units to the exclusion of other units].” And “common
expenses” means “the proposed or actual expenses affecting the property, including reserves, if
any, lawfully assessed by the Board.”
¶8 These definitions are essentially synonymous with the definitions set forth in the Act (765
ILCS 605/2(d), (e), (g), and (m) (West 2018)), although the definition of unit in the Act is “a part
of the property designed [rather than “designated” as used in the declaration’s definition] and
intended for any type of independent use” (see id. § 2(d)). The declaration identifies the following
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2022 IL App (2d) 210440-Ucommon expenses: “[s]now plowing, lawn mowing, landscape maintenance, fire alarm phone line
and monitoring board at the Police Station, monthly electric charges for sprinkler rooms, sprinkler
and domestic annual backflow certification.”
¶9 Article II of the declaration, entitled “Units,” provides a description of the units. Namely,
section A of article II provides that “[a]ll units are delineated” on the plat of survey attached as
exhibit A to the declaration and listed in exhibit B to the declaration and that “[e]ach unit consists
of the space enclosed and bounded by the horizontal and vertical planes set forth in the delineation
thereof ***” on the plat of survey. Exhibit A—the plat of survey—depicts the division of the
property into nine condominium units (identified as units A through I) and demarcates each of the
nine units’ dimensions, boundaries, and geographic locations on the property. Units A, B, C, D,
and E are located on what is identified as lot 14, and units F, G, H, and I are located on what is
identified as lot 1 (and adjacent to what is identified as the south line of lot 2). There is a notation
on the plat of survey: “Partial Building Under Construction On Parcel A Thru E Is Not Shown
Hereon.” There are also notations setting forth the floor and ceiling elevations of units A through
E and the floor and ceiling elevations of units F through I.
¶ 10 Exhibit B is an inventory of the condominium units. It states that the total square footage
of the land is 89,540, the total square footage of the building is 34,760, and the total square footage
of the common elements is 54,780. Exhibit B also lists, in table form, each of the nine identified
units and sets forth their respective square footage in the building and calculated percentage of the
total unit ownership of the building and common elements, as follows:
Unit A: 5000 square feet; 14.38% ownership
Unit B: 4880 square feet; 14.06% ownership
Unit C: 5000 square feet; 14.38% ownership
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2022 IL App (2d) 210440-UUnit D: 2500 square feet; 7.19% ownership
Unit E: 2500 square feet; 7.19% ownership
Unit F: 2500 square feet; 7.19% ownership
Unit G: 2380 square feet; 6.85% ownership
Unit H: 5000 square feet; 14.38% ownership
Unit I: 5000 square feet; 14.38% ownership
The square footage of the units totals 34,760 (the stated total square footage of the building); the
percentages total 100%. Exhibit B states that the percentages “will be used for General repairs of
building, common areas and taxing purposes.”
¶ 11 Regarding payment of assessments, article V, section A of the declaration provides: “Each
Unit Owner shall pay his proportionate share of the Common Expenses *** in the same ratio as
his percentage of ownership interest in the Common Elements ***. If any Unit Owner shall fail or
refuse to make any such payment of the Common Expenses when due, the amount thereof shall
constitute a lien on the Unit Ownership of such Unit Owner as provided in the Act.”
¶ 12 The Act, in turn, provides:
“All common expenses incurred or accrued prior to the first conveyance of a unit
shall be paid by the developer, and during this period no common expense assessment shall
be payable to the association. It shall be the duty of each unit owner including the developer
to pay his proportionate share of the common expenses commencing with the first
conveyance. The proportionate share shall be in the same ratio as his percentage of
ownership in the common elements set forth in the declaration.” (Emphasis added.) 765
ILCS 605/9(a) (West 2018).
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2022 IL App (2d) 210440-UIn the event a unit owner fails or refuses to pay the common expenses or any unpaid fine when
due, “the amount thereof together with any interest, late charges, reasonable attorney fees incurred
enforcing the covenants of the condominium instruments, rules and regulations of the board of
managers, or any applicable statute or ordinance, and costs of collections shall constitute a lien on
the interest of the unit owner in the property ***.” Id. § 9(g).
¶ 13 The declaration specifies in section I of article XV that assessments are payable even if the
unit owner does not use or abandons the unit: “No Unit Owner may waive or otherwise escape
liability for the assessments provided herein by non-use of the Common Elements or abandonment
of his Unit.” Moreover, as set forth in section H of article XV, the association has “no authority to
forebear the payment of assessments by any Unit Owner.”
¶ 14 Holtgren sold units A, B, C, D, and E, and in June 2001, executed and recorded an
amendment to the declaration. The recitals to the amendment provide, inter alia:
“WHEREAS, certain unit dimensions as set forth on the survey attached to the
Declaration were subject to change;
WHEREAS, said dimensions for the constructed building on Lot 14 are now
permanent and not subject to change, however, the dimensions for the building to be placed
on Lot 1 and a portion of Lot 2, as shown on the Plat, are proposed and subject to change.”
¶ 15 Accordingly, “[t]he plat attached to the declaration showing, delineating and describing the
units contained therein is hereby amended by Exhibit A attached hereto delineating and describing
the units contained on Lot 14 and the proposed units for the building to be constructed on Lot l
and a portion of Lot 2 therein in compliance with Section 5 of the Condominium Property Act
[765 ILCS 605/5 (West 2018), entitled “Plat to be recorded”].” The attached amended plat of
survey continues to depict the division of the property into nine condominium units (identified as
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2022 IL App (2d) 210440-Uunits A through I) with Units A, B, C, D, and E located on what is identified as lot 14, and units
F, G, H, and I located on what is identified as lot 1 (and adjacent to what is identified as the south
line of lot 2). Lot 14 contains the notation “Multi-Unit Masonry Building”; Lot 1 contains the
notation “Future Building.” The amendment to the declaration concludes that, “[e]xcept as
expressly set forth herein, the declaration shall remain in full force and effect in accordance with
its terms.”
¶ 16 Holtgren continues to own units F, G, H, and I, and lot 1 remains an undeveloped, vacant
lot. At some point, although the precise date is not reflected in the record, the association began to
levy assessments against Holtgren for units F, G, H, and I. Following Holtgren’s refusal to pay
assessments on the units, the association recorded a lien against the property. As a result of the
lien, Holtgren’s attempts to sell the four remaining units have been unsuccessful.
¶ 17 B. Trial Court Proceedings
¶ 18 Holtgren initiated this lawsuit on December 9, 2019. After two rounds of successful
motions to dismiss, Holtgren was granted leave to file the operative complaint—a second amended
complaint for a declaratory judgment pursuant to section 2-701 of the Code of Civil Procedure
(735 ILCS 5/2-701 (West 2018)). Citing the relevant portions of the declaration and amendment
to the declaration, Holtgren alleged that the lot remains vacant and undeveloped and that, unlike
units A, B, C, D, and E, the square footage and percentage of ownership for his units F, G, H, and
I are subject to change. Holtgren further alleged that he receives no benefit from the lot. According
to Holtgren, the association has levied assessments against him “for a number of years,” and the
lien is for a “sum of money which in [his] opinion, far exceeds the value of the subject property.”
Thus, Holtgren sought a declaratory judgment that no assessment is due on lot 1, that the intent of
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2022 IL App (2d) 210440-Uthe declaration was to create an assessment for improved real estate only, and that the lien against
the property has no force or effect and amounts to a slander of title.
¶ 19 On June 3, 2021, the association moved to dismiss the second amended complaint with
prejudice for failure to state a claim pursuant to section 2-615 of the Code of Civil Procedure (735
ILCS 5/2-615 (West 2020)). The association argued, inter alia, that the definition of unit in the
Act and declaration is unambiguous as to its inclusion of both developed and undeveloped
condominium units and that nothing in the declaration excluded undeveloped units from
assessment payments. In response to the motion to dismiss, Holtgren argued, inter alia, that “unit”
is ambiguous and that the entirety of the declaration, plat, and amended plat, considered together,
demonstrate that his four undeveloped units should not be subject to assessments.
¶ 20 Following briefing and argument, on August 4, 2021, the trial court granted the
association’s motion to dismiss the second amended complaint with prejudice. The record does
not include a transcript of the proceeding. In its written order, the trial court found that: (1) the
declaration “is not ambiguous with respect to the definition of a ‘unit’ in the Condominium”;
(2) the declaration “nowhere distinguishes between improved and unimproved Condominium
units”; (3) “the definition of ‘unit’ as set forth in the Declaration nowhere requires or prescribes a
present use, or a particular use, as a precondition or qualification for status as a ‘unit’ in the
Condominium”; (4) “[t]he Declaration states expressly that non-use of a Condominium unit does
not waive or exempt a unit owner from the obligation to pay assessments”; and (5) “[t]he units
designated ‘F,’ ‘G,’ ‘H’ and ‘I’ in the Declaration are Condominium ‘units’ for all purposes under
the Declaration and the [Act].”
¶ 21 Holtgren timely appealed.
¶ 22 II. ANALYSIS
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2022 IL App (2d) 210440-U¶ 23 Holtgren argues that the trial court erred in dismissing the second amended complaint
because he stated a claim for declaratory relief from imposition of assessments on the four
undeveloped units. According to Holtgren, the definition of a unit in the declaration is ambiguous
and was not intended to include vacant land. Rather, Holtgren contends that the property must be
developed with a structure to be considered a unit subject to assessments. We disagree, as set forth
below.
¶ 24 The trial court granted the association’s motion to dismiss the second amended complaint
pursuant to section 2-615. A section 2-615 motion to dismiss challenges the legal sufficiency of
the complaint. 735 ILCS 5/2-615 (West 2020). Cochran v. Securitas Security Services USA, Inc.,
2017 IL 121200, ¶ 11. In ruling on the motion, the trial court must accept as true all well-pled
facts, as well as any reasonable inferences that may arise from them. Id. “The essential question is
whether the allegations of the complaint, when construed in the light most favorable to the plaintiff,
are sufficient to establish a cause of action upon which relief may be granted.” Id. We review de
novo an order granting a section 2-615 motion to dismiss. Id.¶ 25 Resolution of whether Holtgren’s undeveloped units are subject to assessments requires
interpretation of the Act and the declaration. We must examine any relevant provisions in the Act
and the declaration and construe them as a whole. See V & T Investment Corp. v. West Columbia
Place Condominium Ass’n, 2018 IL App (1st) 170436, ¶ 22; Carney v. Donley, 261 Ill. App. 3d
1002, 1008 (1994). Principles of statutory construction guide the analysis. V & T Investment Corp.,
2018 IL App (1st) 170436, ¶ 22; see also Toepper v. Brookwood Country Club Road Ass’n, 204
Ill. App. 3d 479, 487 (1990) (applying similar rules of contract construction to the interpretation
of a condominium declaration).
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2022 IL App (2d) 210440-U¶ 26 The fundamental objective of statutory construction is to ascertain and give effect to the
legislature’s intent. 1010 Lake Shore Ass’n v. Deutsche Bank National Trust Co., 2015 IL 118372,
¶ 21. The best indicator of legislative intent is the statutory language, given its plain and ordinary
meaning. Id. Each word, clause, and sentence of a statute must be given a reasonable construction,
and no term should be rendered superfluous. Id. A court will not depart from the plain language
by reading in exceptions, limitations, or conditions not expressed therein. Siena at Old Orchard
Condominium Ass’n v. Siena at Old Orchard, LLC, 2017 IL App (1st) 151846, ¶ 67. Statutes must
be construed to avoid absurd or unjust results. Richards v. Vaca, 2021 IL App (2d) 210270, ¶ 11.
Like the review of a section 2-615 dismissal, we review de novo questions of statutory
interpretation. 1010 Lake Shore Ass’n, 2015 IL 118372, ¶ 21.
¶ 27 The parties’ arguments turn on the interpretation of “unit”—defined in the Act as “a part
of the property designed and intended for any type of independent use” (see 765 ILCS 605/2(d)
(West 2018)), and defined in article I of the declaration as “a part of the property designated and
intended for any type of independent use.” (Emphases added.) Neither party argues that the
distinction in the verbiage impacts the resolution; indeed; the parties do not acknowledge the
distinction. Ultimately, the distinction is without a difference in our analysis, as a review of the
declaration demonstrates that all nine units, including Holtgren’s units F, G, H, and I, are explicitly
designed or designated and intended for independent use.
¶ 28 Regarding the design or designation of the units, the declaration divides the condominium
property into nine condominium units and their concomitant apportionment of common elements.
All nine units are identified in the plat and amended plat of survey with precise boundaries and
geographic locations on the property. In addition, the inventory of the condominium units lists
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2022 IL App (2d) 210440-Ueach of the identified units with their respective square footage and calculated percentage of the
common elements.
¶ 29 All nine units are also unequivocally intended for independent use. The express statement
of intent set forth in the declaration provides that the owner “desires and intends by this
Declaration” to submit the property to the Act and to declare that future owners shall enjoy the
benefits of and hold their interests subject to the stated rights and restrictions in furtherance of a
plan to promote and protect the cooperative ownership and enhance the value of the property.
Holtgren contends that there can be no independent use of his units F, G, H, and I, because there
is no building on the vacant land. This argument misses the point. The question is the intended use
of the property. The intention that portions of the property be for independent use was set forth in
the declaration. Specifically, the declaration identified all nine units (improved and unimproved)
as “units,” granted all nine units identical rights and obligations, and assigned all nine units unique
identifiers, square footages, and percentages of common elements.
¶ 30 Holtgren maintains that the definition of a unit is ambiguous given the entirety of the
declaration and amended declaration. He points to section A of article II of the declaration,
providing that “[e]ach unit consists of the space enclosed and bounded by the horizontal and
vertical planes set forth in the delineation thereof” on the attached plat of survey. Holtgren argues
that a vacant lot cannot be enclosed and bounded by horizontal and vertical planes. He also argues
that the statement in the recital to the declaration’s amendment—that the dimensions for the
unimproved units are subject to change—amplifies the ambiguity. We disagree that the definition
of unit is ambiguous and further note that any purported ambiguity would be resolved against
Holtgren, as the drafter of the declaration. See Sherwood Commons Townhome Owners Ass’n v.
Dubois, 2020 IL App (3d) 180561, ¶ 31.
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2022 IL App (2d) 210440-U¶ 31 Preliminarily, without citation to authority, the association argues that the recital in the
declaration’s amendment has no operational effect (although it did not raise the same challenge to
reliance upon the intent recitals in the initial declaration). The association is correct that “[r]ecitals
to a contract provide explanations of the circumstances surrounding the execution of the contract
but are not generally binding on the parties and are not an effective part of their agreement unless
referred to in the operative portion of the agreement.” In re Marriage of Woodrum, 2018 IL App
(3d) 170369, ¶ 109; see also Toepper, 204 Ill. App. 3d at 489 (declining to resolve whether recitals
in a developer agreement were binding where the language in the recitals did not resolve the central
issue of whether the developer rights were assignable). That being said, recitals reflect the parties’
intention and create a context through which the operational portion of the document can be better
understood. Hagene v. Derek Polling Construction, 388 Ill. App. 3d 380, 385 (2009). Ultimately,
the argument is merely academic here, because the language upon which Holtgren relies does not
render the definition of a unit ambiguous in any event.
¶ 32 The undisputed intent of the declaration was to submit the property to the Act and the
attendant rights and restrictions of cooperative ownership in a condominium unit. Units F, G, H,
and I are defined in the declaration, delineated on the plat of survey, and listed in the inventory.
The provision that “[e]ach unit consists of the space enclosed and bounded by the horizontal and
vertical planes” and the ability to change the dimensions of the unimproved units in no way impacts
the clear designation or design and intention for independent use of the parcels. Indeed, Holtgren’s
position is illogical. If the unimproved units were not in fact units, then there would have been no
reason to identify and itemize them in the manner set forth in the declaration.
¶ 33 Moreover, there is no provision anywhere in the declaration stating that the construction of
an improvement to the property is a condition precedent to unit status. The declaration does not
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2022 IL App (2d) 210440-Uspecify or limit the physical character of a unit. We cannot read into the declaration a limitation or
condition not expressed therein. See Siena at Old Orchard Condominium Ass’n, 2017 IL App (1st)
151846, ¶ 67. It is the straightforward definition of unit set forth in the Act and declaration—a part
of the property designed or designated and intended for independent use—that dictates our holding
that Holtgren’s undeveloped units are subject to assessments.
¶ 34 Holtgren persists in arguing the unfairness of being assessed as if there were a “15,000
square foot building” on the lot (the total square footage of Holtgren’s units F, G, H, and I is
14,880), notwithstanding that he receives no benefit from the undeveloped units. However, the
declaration expressly provides in section I of article XV that nonuse or abandonment of the unit
does not exempt a unit owner from liability for assessments. In addition, the common expenses
identified in the declaration includes exterior maintenance of the lots—a value even for
undeveloped units. There is simply nothing in either the Act or declaration that allows Holtgren to
escape liability for assessments based upon his own nondevelopment of the units.
¶ 35 We further note that, according to the ownership percentages set forth in the inventory of
units attached as exhibit B to the declaration, the proportionate shares of assessments for
Holtgren’s units F, G, H, and I are 7.19%, 6.85%, 14.38%, and 14.38%, respectively, totaling
42.8%—almost half of the proportionate shares. Holtgren offers no explanation for who would be
responsible to cover that percentage of assessments, if not him. There is nothing in the Act or the
declaration to suggest that the other unit owners could be saddled with the additional percentage
of assessments in the event of nondevelopment of the remaining units. In fact, section 4(e) of the
Act provides that the percentage of ownership interest in the common elements allocated to each
unit in the declaration “shall remain constant unless otherwise provided in this Act or thereafter
changed by agreement of all unit owners.” (Emphasis added.) 765 ILCS 605/4(e) (West 2018); see
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2022 IL App (2d) 210440-UHuskey v. Board of Managers of Condominiums of Edelweiss, Inc., 297 Ill. App. 3d 292, 295-96
(1998) (“Common interest ownership goes to the essence of an owner’s property interest in the
condominium. The percentage of common interest ownership impacts the unit’s owner’s property
taxes, the amount of annual and special assessments, as well as the resale price of the unit.”).
¶ 36 In this regard, we note that the initial declaration contemplated one building with nine units,
while the amendment to the declaration contemplated two buildings—with five units in the
constructed building on lot 14, and four units in the building to be constructed on lot 1. Neither
party acknowledges or addresses this distinction. Regardless, while the amendment provided that
the dimensions of the building to be constructed on lot 1 were subject to change, the amendment
did nothing to change the overall calculation of ownership percentages explicitly set forth in
exhibit B to the declaration. To the contrary, the amendment explicitly provided that, “[e]xcept as
expressly set forth herein, the declaration shall remain in full force and effect in accordance with
its terms.”
¶ 37 Holtgren cites cases from other jurisdictions to support his position that undeveloped
condominium units are not subject to assessments. See, e.g., SE Property Holdings, LLC v.
Rookery III, No. 11-0629-WS-B, 2013 WL 69030, at *10-11 (S.D. Ala. Jan. 3, 2013) (statute
defining unit as “ ‘[a] physical portion of the condominium designated for separate ownership or
occupancy’ ” did not exempt unbuilt units yet allowed for a modified definition in the declaration;
the declaration defined unit as having boundaries consisting of “ ‘innermost planes of the interior
finished surfaces’ ”); Tara Manatee, Inc. v. Fairway Gardens at Tara Condominium Ass’n, 870
So. 2d 32, 36 (Fla. Ct. App. 2003) (holding that a developer was not required to fund deferred
maintenance reserves for unbuilt condominium units, where the Florida statute addressing reserve
accounts set forth a formula based upon the remaining “useful life” of each item).
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2022 IL App (2d) 210440-U¶ 38 Ultimately, a review of the jurisprudence reflects that the determination of whether an
undeveloped unit is subject to assessments hinges on the respective statutory language and
provisions in the declaration. See 15B Am. Jur. 2d Condominiums § 33 (“Whether an unbuilt unit
in a condominium is subject to the general assessment for common expenses depends generally on
the particular declaration controlling the condominium.”); see also Buchholz v. Waterville Estates
Ass’n, 934 A.2d 511, 513, 516 (N.H. 2007) (holding that the association was authorized to collect
association dues and assessments from tax sale purchaser of unimproved lot in condominium
development); Aluminum Industries Corp. v. Camelot Trails Condominium Corp., 535 N.W.2d
74, 78 (Wis. Ct. App. 1995) (reasoning that the statutory definition of unit included condominium
land on which construction had not yet begun).
¶ 39 The Wisconsin Appellate Court’s decision in Aluminum Industries is illustrative. The issue
in Aluminum Industries was whether a condominium property on which no construction had taken
place was a unit subject to assessment for common expenses under the Wisconsin Condominium
Ownership Act (Wisconsin Act) (Wis. Stat. §§ 703.02(15) and (17), 703.16(2)). Aluminum
Industries, 535 N.W.2d at 75. The trial court granted summary judgment in favor of the owner
(and successor-in-interest to the developer) of the undeveloped condominium property on its
claims for a declaratory judgment and permanent injunction to restrain the condominium
association from placing liens on the property due to the owner’s nonpayment of assessments. Id.
at 77. The trial court reasoned that a unit is “ ‘a constructed unit’ ” and that the owner’s “ ‘fifteen
unbuilt units *** are phantom units.’ ” Id. The trial court further explained that “ ‘[t]hey’re unbuilt
spaces of air and *** as such they are dissimilar in nature with those types of units which are
constructed for the purposes of assessment.’ ” Id.- 15 -
2022 IL App (2d) 210440-U¶ 40 While the appellate court affirmed summary judgment in the owner’s favor, it did so on
other grounds and explicitly disagreed with the trial court’s rationale. Id. Turning to the relevant
statutory provisions, the appellate court noted that a unit was defined as “ ‘a part of a condominium
intended for any type of independent use, including one or more cubicles of air at one or more
levels of space or one or more rooms or enclosed spaces located on one or more floors, or parts
thereof, in a building. A unit may include 2 or more noncontiguous areas.’ ” Id. (quoting Wis.
Stats. § 703.02(15)). Given the lack of any language limiting the definition’s application to
constructed units, the court reasoned that, “[c]learly and unambiguously, therefore, that definition
includes condominium land intended for construction but on which construction has not been
started or completed.” Id. at 78. Accordingly, the court concluded that “the statutory definition of
‘unit’ encompassed a property on which there is no constructed unit.” (Emphasis in original.) Id.
at 79 (citing Hatfield v. La Charmant Home Owners Ass’n, 469 N.E.2d 1218, 1221-22 (Ind. Ct.
App. 1984) (developer who held title on uncompleted and unsold units was a unit owner and thus
subject to the same assessments as any other unit owner) (citing Brooks v. Palm Bay Towers
Condominium Ass’n, 375 So. 2d 348, 349-50 (Fla. Ct. App. 1979) (developer was a unit owner
obligated to pay proportionate share of common expenses))).
¶ 41 However, the Wisconsin Act also provided that “ ‘[f]unds for the payment of common
expenses and for the creation of reserves for the payment of future common expenses shall be
obtained by assessments against the unit owners in proportion to their percentage interests in the
common elements or as otherwise provided in the declaration.’ ” (Emphasis added.) Id. at 77
(quoting Wis. Stat. § 703.16(2)). The declaration there “otherwise provided” that the property
would not be assessed prior to construction of dwelling units. Id. at 79. Namely, the declaration
required that assessments be paid on dwelling units only, as reflected by various provisions therein
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2022 IL App (2d) 210440-Umaintaining a distinction between the land versus dwelling or living units and planned units versus
built units. Id. at 79-80. Thus, the court held that unit owners were not subject to assessments prior
to construction of a dwelling unit on their property. Id. at 81.
¶ 42 In contrast to the statutory scheme and declaration at issue in Aluminum Industries, here,
the Act provides that “[i]t shall be the duty of each unit owner including the developer to pay his
proportionate share of the common expenses [in the same ratio as the percentage of ownership in
the common elements set forth in the declaration] commencing with the first conveyance.”
(Emphasis added.) 765 ILCS 605/9(a) (West 2018). There is also nothing in the declaration stating
that only improved or dwelling units are subject to assessments. Rather, all units are treated
identically in the declaration. Accordingly, there is no basis upon which to exempt Holtgren’s units
from assessments. Thus, the trial court did not err in granting the association’s motion to dismiss
the second amended complaint with prejudice.
¶ 43 III. CONCLUSION
¶ 44 For the reasons stated, we affirm the judgment of the circuit court of Lake County.
¶ 45 Affirmed.
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