Chicago Partner Hal R. Morris and Chicago Associate Katelyn Rose Letizia secured an important victory for a condominium association client. In that case, the board of the association began considering implementing, by rule, restrictions on leasing. Under the Illinois Condominium Act, rules can be adopted or amended by the board after a special meeting of owners called for the purpose of discussing the proposed rule.
In the case, the board began this process, but two unit owners filed an action challenging the process and the enforceability of a rule limiting leasing. The unit owners claimed that the Declaration of Condominium granted a right to lease, subject to the association’s right of first refusal, and a rule limiting leasing would be tantamount to an improper attempt to modify the Declaration. Thus, the unit owners sought a finding that the leasing rule was unenforceable, ran afoul of the Declaration, and also sought to enjoin the association from passing and enforcing such a rule.
The case was filed on September 1, 2011 and the unit owners immediately moved for the issuance of a preliminary injunction. In response, Mr. Morris and Ms. Letizia objected to the request for preliminary injunction and also moved to dismiss on the basis that the case not only did not state a substantive claim but did not present a case or controversy. While briefing was being conducted on the motion to dismiss, the unit owners filed a motion for temporary restraining order for hearing one hour before the scheduled ruling on the motion to dismiss. On September 19, the trial court rejected the unit owners’ request for oral argument and denied the motion for temporary restraining order, denied the motion for preliminary injunction, and granted the motion to dismiss on the basis that the unit owners did not present a case or controversy and did not have standing. The net effect of the ruling was to permit the statutorily provided for procedure to adopt rules to go forward.