Palm v. 2800 Lake Shore Drive Condominium Ass'n

929 N.E.2d 641, 401 Ill. App. 3d 868
Appellate Court of Illinois·Decided May 28, 2010·No. 1-08-2436·Published·Cited by 32 cases

Opinion

JUSTICE FITZGERALD SMITH

delivered the opinion of the court:

This cause of action arose when Gary Palm (Palm) sought production of various books and records from 2800 Lake Shore Drive Condominium Association (Association), pursuant to the City of Chicago Condominium Ordinance (Chicago Municipal Code §13 — 72— 080 (2009)) (the Ordinance). The Association did not comply. Palm subsequently brought suit against the Association, the board of directors of 2800 Lake Shore Condominium Association (Board), and Kay S. Grossman (Grossman), individually and as president of the Board (collectively, defendants). Defendants claimed that the Association did not have to comply with the Ordinance because it conflicted with existing Illinois law and, therefore, was invalid. The City of Chicago (City) intervened, alleging that the Ordinance was validly enacted according to its home rule power. The trial court granted Palm’s and the City’s (collectively plaintiffs’) motion for summary judgment in regard to the production of various records, finding that the Ordinance was valid and did not conflict with Illinois law. The trial court also granted interim attorney fees to Palm’s attorney. Defendants now appeal, alleging that (1) the trial court erred in granting summary judgment to plaintiffs because the Ordinance is invalid, (2) the trial court improperly awarded attorney fees at a rate of $300 per hour, (3) the trial court erred in refusing to consider defendants’ motion for sanctions, and (4) the trial court erred in granting Palm’s request for documents pursuant to the Association’s declaration. For the following reasons, we affirm.

I. BACKGROUND

The 2800 Lake Shore Drive building is a condominium building. There are more than 700 units in the association. Grossman had served as a member of the Board since 1982 and also as president of the Board. Palm is a unit owner and served on the Board from 1992 to 1998.

While serving on the Board, Palm allegedly became aware of various improprieties and departures from association bylaws, including (1) Grossman exceeded her authority by taking action without authorization from the Board, (2) Grossman and the Association’s counsel did not allow Board members access to Association documents, (3) Board members discussed condominium business, voted, and took action without giving proper notice to or opportunity for input from unit owners, (4) Grossman and management did not require bids on all contracts, (5) management awarded contracts to relatives or entities owned by relatives without proper notification to the Board, and (6) management did not hold “insider” contractors liable for faulty workmanship. Accordingly, Palm requested access to certain Association records. Grossman and the Association counsel denied him access to such documents, claiming that he did not have the right to inspect association records. Palm subsequently filed suit.

Palm filed his original complaint on January 13, 2000, naming the Association as the sole defendant. Palm’s single-count complaint asked the trial court to grant an order requiring the Association to allow him to inspect certain records, declaring members of the Board exempt from having to state a proper purpose in order to obtain records, and declaring that the Board may not take action except at an open meeting. The Association filed a motion to dismiss Palm’s complaint, alleging in part that his prayer for relief was inconsistent with Illinois’s Condominium Property Act (765 ILCS 605/1 et seq. (West 2004)) and the Ordinance. The trial court granted the Association’s motion to dismiss the complaint, without prejudice.

Palm then filed a first amended complaint against defendants. Count TV, the only count at issue in this appeal, alleged that the Association failed to produce books and records under the Ordinance, the Condominium Property Act, the General Not For Profit Corporation Act of 1986 (805 ILCS 105/101.01 et seq. (West 2004)), and the Association’s declaration. Defendants filed a motion to dismiss. The trial court entered an order requiring the parties to submit supplemental briefs on whether the City properly enacted the Ordinance under its home rule authority, or whether state law preempts the Ordinance. The parties filed supplemental briefs regarding such issue.

The trial judge, Judge Sidney Jones, entered a memorandum opinion and order on December 11, 2000, finding that Illinois law preempted the City’s home rule authority to enact the Ordinance, and thus, the Ordinance was invalid.

Palm then filed a motion to reconsider, and defendants filed a response. Soon thereafter, the City filed a petition to intervene in support of Palm’s position. The trial court allowed the City to intervene, but denied Palm’s motion to reconsider. Plaintiffs then each filed a second motion to reconsider, and defendants responded.

A new trial judge granted the plaintiffs’ second motion to reconsider. The new trial judge vacated the prior dismissal order and found that neither the Condominium Property Act nor the General Not For Profit Corporation Act preempts the Ordinance.

On January 31, 2003, the trial court entered summary judgment in favor of Palm on count IV and ordered the Association to immediately produce the requested documents to Palm.

Palm then petitioned the court for an award of interim attorney fees. Palm submitted that an hourly rate of $300 was reasonable and appropriate. Palm noted that he paid his attorney $200 an hour, which was a reduced hourly rate. Palm alleged that it is typical in litigation where attorney fees are recoverable pursuant to statute for an attorney and client to enter into a fee agreement where the client pays a reduced hourly rate, with the reasonable attorney fees to be determined upon the conclusion of the case. Palm filed an affidavit of retired Judge Kenneth Gillis in support of his contention that $300 was a reasonable hourly rate, based on the market value of the work done. In response to Palm’s petition, defendants argued that the court should not entertain issues regarding attorney fees until the conclusion of the litigation and that Palm was not necessarily the “prevailing plaintiff’ under the ordinance. Defendants filed a motion for sanctions against Palm for violation of the trial court’s January 20, 2006, order by disclosing in public filings the billing rate for the Association’s regular counsel. Defendants requested that, as a sanction, Palm’s request for interim attorney fees be denied. The trial court refused to consider defendants’ motion for sanctions and continued such motion generally.

On August 26, 2008, the trial court granted Palm’s petition for interim attorney fees and found him to be the prevailing party under the Ordinance. The trial court awarded Palm fees at a rate of $300 per hour for the period of time from November 1, 2001, to January 31, 2003. Defendants now appeal the January 31, 2003, order granting Palm summary judgment, and the August 26, 2008, order granting interim attorney fees.

II. ANALYSIS

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Palm v. 2800 Lake Shore Drive Condominium Ass'n, 929 N.E.2d 641, 401 Ill. App. 3d 868 (Ill. Ct. App. 2010).

929 N.E.2d 641 (Palm v. 2800 Lake Shore Drive Condominium Ass'n) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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