Revised Section 11 of the Illinois Mechanics Lien Act

Recently, the Illinois Mechanics Lien Act underwent extensive technical revisions that will become effective January 1, 2006. The section of the Act that is the most “clarified” is Section 11 which sets forth what statements must be contained in a foreclosure complaint, what parties need to be named, and what notices need to be provided.

As originally drafted, Section 11 stated that the foreclosure complaint must contain a brief statement of the contract on which it was founded, the date the contract was made, the date when the contract work was completed, and if warranted the reason for not being completed. The complaint also had to contain the amount due and unpaid. Since a company’s contract(s) upon which its claim is founded may include many contracts which have been incorporated by reference, some confusion existed as to whether all such contracts must be identified. The revised Section 11 provides that the claimant is only required to describe its own contract.

Section 11 also provided that the plaintiff had to make all parties interested in the property and all parties of whose interest he or she is notified or has knowledge, parties defendant. Under the revised Section 11, the description of “parties” is clarified to include the following:

• Necessary Parties – These are the owner of the premises, the contractor, all persons in the chain of contracts between the claimant and the owner, all persons who have asserted or may assert liens against the premises under this Act, and any other person against whose interest in the premises the claimant asserts a claim;
• Unknown Necessary Parties -These are necessary parties whose claims or interests are not disclosed by a document recorded at the time a proper lis pendens of the action has been recorded (or if the action is instituted as a mortgage foreclosure, at the time a proper notice of foreclosure has been recorded);
• Unknown Owners – These are persons other than Unknown Necessary Parties who may have an interest in the premises, but whose identities are unknown to the claimant; and
• Permissible Parties -These are any other persons having a legal, equitable or possessory interest in or claim to the whole or any part of the premises. Failure to make any such Permissible Party a party to the action, however, does not defeat the lien, but the claim of each claimant asserting a lien claim under this Act in the action is subject to the interest of such Permissible Party not made a party, and the action does not adversely affect the interest of any such Permissible Party not made a party and not served with notice by summons or publication in the action as provided in the Act.

Additionally, before revision, Section 11 stated that summons must be issued and served as in other civil actions. Revised Section 11 is similar, but more explicit. It sets forth in significant detail how the claimant is to give notice to Necessary Parties, Unknown Necessary Parties and Unknown Owners.

Finally, the original Section 11 allowed a party in interest to be made a party to the pending foreclosure suit anytime before final judgment. The revised Section 11 maintains this same rule, but states that joinder shall not give that party any substantive rights not otherwise provided by law, or excuse failure to comply with the provisions of any applicable law.

The revised Section 11 can be found at 770 ILCS 60/11.

Should you have any questions or require additional information, contact Randolph Ruff at (312) 558-1228, or e-mail the Client Services Department, which will direct you to a firm attorney in your region.

Note: This article was published in the November 1, 2005 issue of the Construction eAuthority.