Hinch Law

Update - just the day after I posted this, on 2/19/19, the governor signed this bill into law. Much has been written on both sides as to the pros and cons of the new $15 minimum wage and how it is phased in under the  Illinois Senate Bill 1 , which is currently pending signature by the governor and will soon be law. I’m not writing this post to chime in one way or the other about that. The reason for this post is to alert business owners about other provisions of the bill that have been less publicized but are very important. The current Illinois Minimum Wage Act  is codified at 820 ILCS 105. Section 7 of the Act now expressly authorizes the State to randomly audit employers for compliance. Section 10 authorizes the Department of Labor  to make emergency rules under the Administrative Procedures Act to implement the new law as appropriate for enforcement. Section 11 of the Act already provided for potential criminal charges against an employer (or ...

I represent some Illinois homeowners associations, and in the past year have seen several for which the association common areas received property tax bills and assessments as if they were privately owned parcels. In one case that was just resolved, I was able to help the association timely appeal the assessment, make our case before the county board of review, demonstrate the error to the county, and achieve a significant tax savings for the HOA and its residents (in that case, the assessed value went from in excess of $100,000 to essentially $0). Here's the reason why: In Illinois, the property tax code (See in particular 35 ILCS 200/10-35 ) contains a special provision for subdivision common areas, specifying that the assessed value of such parcels is fixed at $1.00. For such properties, the valuation of the individual lots in the subdivision is supposed to already account for the value of the common areas and any common area amenities. It does not matter how fancy is the ...

I've previously written about snow removal liability, and particularly the case of Murphy-Hylton v. Lieberman Management Services, Inc. , first at the appellate court and ultimately when the Illinois Supreme Court affirmed the appellate ruling. That case involved ice allegedly forming from a faulty downspout install, not merely removal of naturally accumulated snow. In Hussey v. Chase Manor Condo. Assoc . , the appellate court had occasion to revisit #snowlaw , specifically the Illinois Snow and Ice Removal Act , 745 ILCS 75/2, and its immunity provision. The case involved a plaintiff who slipped and fell while walking across an area that apparently had parking spaces but also excess paved area, which condo residents would walk across to enter the building.  The trial court had granted summary judgment to the association, finding this area to be equivalent to a "sidewalk." What exactly is a "sidewalk?" It's important because the Act grants immunity t...

A few years ago I wrote this post about liability issues for neighbors where a tree limb hangs over the property line.  A focus of the article was the Illinois appellate court ruling in Ortiz v. Jesus People U.S.A ., a case in which a large tree branch extended over a public sidewalk, and fell, injuring a pedestrian.  The appellate court affirmed a trial verdict finding the defendant liable - they negligently failed to meet their legal duty of reasonable care, and that the resulting injury was a foreseeable result. The Ortiz case arose in Chicago, an urban setting obviously. Two more recent cases further clarified the law of tree liability - for trees next to a road, and for trees located on a park-like property, such as a private golf club. In Belton v. Cook County Forest Preserve District , the plaintiff sued the District after a tree fell on on his car as he was driving on a road adjacent to the forest preserve. The trial court had granted summary judgment for the D...

A few years ago I wrote this post about public insurance adjusters and the law in Illinois, and the 2011 case of Golub and Associates v. State Farm Fire and Casualty Company . Thank you to all who commented on that post (and there were many!).  Based on the level of interest and the fact that the relevant statutes have been amended since the last post, I decided to write this update.   What's a public insurance adjuster?  See here for the full definition in the statute .  Basically, a public adjuster is hired to assist someone who has suffered a catastrophe or other loss or damage to property, in negotiating with the insurance company on behalf of the insured. To do so in Illinois, the public adjuster is required to hold a license.   The rules for obtaining and maintaining a license are provided in Article XLV of the Illinois Insurance Code ; this Article is also referred to as the "Public Adjusters Law," and became effective in 2011.  Since tha...

I previously wrote about the law of hold harmless or legal release contracts in Illinois, but an update of recent court cases is timely. The general rule has not changed. Illinois views such agreements as valid and legally binding, under the public policy of allowing freedom of contract.  But because Illinois also has a strong policy that a person should be liable for their own negligence, courts strictly construe such contracts against the benefitting party, and carve out some exceptions to enforceability. Generally a release is enforceable if (1) its terms are clear, explicit, and precise; (2) the release language (sometimes called the "exculpatory clause") encompasses the activity, circumstance, or situation contemplated by the parties to relieve the defendant from a duty of care; (3) it is not against settled public policy; and (4) nothing in the "social relationship of the parties militates against upholding the agreement." Regarding the final factor, co...

The Illinois Appellate Court 4th District case of Collins v. Noltensmeier provides an example of why power attorney agents need to tread very carefully when giving gifts to themselves.  After the principal (Billy) passed away, the case arose as a dispute between Billy's brother and niece (plaintiffs) and his long-term girlfriend/partner Patricia who also acted as his caretaker. Billy signed a will and power of attorney for property (using the statutory short form ) about a week before he passed away, naming Patricia as his POA agent, executor and sole beneficiary in his will. After Billy died and Defendant filed his will with the court, plaintiffs filed a will contest and a separate case against defendant for breach of fiduciary duty and wrongful conversion of Billy's IRA.  Apparently Patricia acting as POA agent for Billy had changed the beneficiary of his IRA, to herself. In court, Patricia defended herself by citing the wording of the Illinois statutory POA form, whi...

In Peraino v. Winnebago County , after summary judgment was awarded to the defendant, the plaintiff's attorney waiting until the last few minutes before the deadline to file a motion to reconsider.  That deadline landed on 1/3/17.  The attorney apparently attempted to upload the motion at 11:55 pm that day, but ran into issues getting the file to upload, such that it was not processed and date-stamped until 12:03 am on 1/4/17. On appeal, plaintiff's attorney relied on a local rule regarding e-filing technical problems.  There was a discussion about whether a user error was a technical problem within the scope of the local rule (the trial court ruled it was not). Ultimately though the appellate court noted the problem here was a new e-filing spin on a longstanding legal principle.  The 30 day deadline after final judgment lapsed, meaning the court no longer had jurisdiction over the case, and therefore could not provide the relief sought.  Similarly, the p...

What does "cause" mean?  In McManus v. Richards , an orthodontist was buying into a practice group, but four years into the buy-in contract, when she had paid for a 45% interest and was nearing equal partner status with the other orthodontist, she was fired for "cause."  The two doctors had apparently fallen out and the one buying in informed the other of her intent to dissociate from the practice, so she was fired preemptively.  She showed up to the office one morning, and the locks had been changed, computer passwords changed, and she was excluded access to patient records. As we often see with such ownership buy-in arrangements, there was a buy-in contract, but no separate employment contract.  The buy-in contract identified party rights to dissociate, voluntarily or in event of "cause," but "cause" was not defined.  The existing practice owner argued that in this case the word "cause" was merely as defined by the dictionary - ...

This is a continuation of my previous post on the topic of renewable energy project contracts.  The first post focused on contract drafting and review concerns for landowners to note. Again, wind and solar projects in particular have been moving forward through local government approvals lately.  Since my first post, the McLean County Board has, on a 10- 8 vote, followed the recommendation of its Zoning Board of Appeals and approved one wind proposal.  See this recent article from the Bloomington Pantagraph . In this post, I want to focus particularly on one of the contract issues I mentioned last time, as it affects certain third parties - namely, contract provisions regarding liens and lien rights that are within the easement agreement / lease.  These provisions typically indicate that the renewable energy system is personal property and not an improvement to the real property itself, and that as such will be exempt from the Mechanics Lien Act .  Thi...

Illinois appears to be undergoing a resurgence in renewable energy projects, in the form of wind farms and now solar farms.    It's only a month into 2018, and McLean County, Illinois has had several such projects in the news, from at least three different energy companies (both wind and solar).  The Bloomington Pantagraph  newspaper calls it a " renewable energy boom ."  The news has primarily been about local government land use hearings, at which evidence is heard regarding the effects and economic benefits of such projects.  There's some opposition being raised for various reasons, with the economic development of the projects and the big picture benefits of renewable energy raised as supporting arguments.  I'm not here to debate all that. These projects can be critical to landowner farmers and their families as a revenue stream that is not tied to the ups and downs of agricultural markets, but also can be realized without having to give up...

If you own an interest in an Illinois Limited Liability Company (LLC), good news!  Effective yesterday, certain filing fees have been significantly reduced.  See this press release from Secretary of State Jesse White's office for details as to the fee changes. If you have a current LLC, you are required to file Annual Reports with the State, and pay the annual filing fee associated with that.  This fee is being reduced from $250 to $75.  The fee is generally due on the anniversary of forming your LLC, which means the payment due date is different for each LLC.  The Secretary of State typically mails the Annual Report form out a few months in advance of the due date.   If your LLC annual report is due soon, you should doublecheck to ensure that you do not accidentally overpay the fee. For those who may have been holding off on forming a corporation or LLC due to cost concerns, this fee reduction is also great news! To file "Articles of Organizatio...

If your spouse died since 2011, the IRS earlier this year extended the timeframe you have to make a "portability" election by filing a Form 706 Estate Tax Return , until the later of either January 2, 2018 or the second anniversary of the decedent's date of death.  See Revenue Procedure 2017-34 . Here's what that means and why it is important . Remember the "fiscal cliff" issue from a few years back?  The federal estate tax used to have a sunset provision.  When that expired, Congress did not update it right away, but debated what to do, before finally enacting a law that made the estate tax permanent (not sunsetting). The estate tax exclusion, the threshold amount of wealth below which you would not owe any estate tax, was set at $5 million, with an adjustment each year for inflation. (For 2017 that number is $5.49 million, and the IRS has announced it will go up to $5.6 million for 2018.  For ease of reference, I'm going to stick to the round num...

In the recent case In Re: Estate of Lee , the Illinois Appellate Court , Third District, reviewed orders from the trial court requiring an accounting from the trustee, finding contempt for failure to comply by the deadline in the court order for the accounting, ordering the executor to bypass the trustee and make payments direct to the beneficiaries, and removing the trustee.  The appellate court affirmed the court orders, except reversing the contempt ruling and sanctions. The decedent (Sandra) died in 2005, leaving three minor children. She had a will that (in a common estate planning strategy for parents with minor children) included a testamentary trust as the means by which her children would receive their inheritance, and providing that each child would receive 1/3 of the trust assets at the age of 25.  The will appointed an executor (Jennifer) and a trustee (Kathleen) who appears to also have served as guardian (the opinion indicates the children lived with Kathl...

A recent Illinois appellate court decision chimed in on an interesting twist on the enforcement of non-compete agreements and when social media activity might cross the line and pose a violation. In Bankers Life and Casualty Co. v. American Senior Benefits, LLC , Bankers Life sued several former employees who had left the company and joined a competitor, allegedly in violation of their non-compete agreements.  The appeal resulted from a summary judgment award in favor of one particular employee, who was a sales manager in a Rhode Island office of the company, and focuses primarily on that employee's situation. A non-compete agreement must be reasonable in its time and territory restrictions to be enforceable at law.  In this case, the non-compete agreement provided that the employee would not compete with the company for two years after termination, within the sales territory of the Rhode Island office. From the appellate court opinion's summary of the allegations, the ...

The recent ruling of the Illinois Supreme Court , In re Estate of Thomas F. Shelton , presents the sad tale of a dispute between siblings over a family farm, and the fiduciary duties required of power of attorney agents.  Mr. and Mrs. Shelton both passed away in 2012.  Each named their daughter as executor of their estates, but in a "divide and conquer" approach to naming fiduciaries that is not uncommon for those with more than one adult child, Mr. and Mrs. Shelton named each other as primary agent for Power of Attorney for Property or financial matters, and their son as backup agent (the daughter was named as the second backup). (The opinion does not specify, but it is likely they each named each other as first choice for executor, but the backup order was reversed as to the son and daughter).  The POAs were signed in 2005, using the "statutory short form" POA for Property .  Fast forward then to late 2011, approximately one year before the death of both Mr...

I recently received a call on behalf of a former client who had apparently suffered some serious medical issues.  The gentleman who called informed me that, since I last communicated with the former client, he had signed a new Power of Attorney for Property ("POA") appointing the caller his agent.  He told me that they had not worked with an attorney in preparing this new POA but just "found one online." The agent sought to review/obtain a copy of the former client's file at my office, including his estate planning documents.  I asked the agent to send me a copy of the new POA so I could take a look at it. When I reviewed the new POA document, I saw the typewritten provision where the former client named the caller his agent.  I then checked to ensure the document had been signed by the principal, witnessed and notarized properly.   There were two attesting witnesses who signed the document - the named agent himself and his spouse (the spouse was also named...

Get ready for changes to the Illinois LLC Act .  Last year a bill to amend the statute was signed into law, but with its effective date deferred to July 1, 2017, and is now less than a month away.  This is a significant update to the statute and may potentially affect existing LLCs; it is worth taking a look at an LLC's current Operating Agreement in light of the changes, to see if any updates are in order.  For a complete review of all the changes, see the text/markup of the statute here . There are many changes to the statute, but I'd like to focus on one, particularly significant change.  LLCs will now be able to designate certain members having authority to act for the company.  This is a very significant change; existing LLCs may wish to revisit their management structure and operating agreements to see whether they could benefit by utilizing this new process. As part of the application to file Articles of Organization, Illinois LLCs are required to de...

Last winter I wrote about the First District Appellate court decision in  Murphy Hylton v. Lieberman Management Services, Inc . Here is that previous post .  After that decision, one of the parties petitioned the Illinois Supreme Court to hear the case, and the court granted the petition.  In the spirit of the season, the Illinois Supreme Court last week issued its decision , affirming the First District ruling. My previous post went through the case and potential liability and immunity under the Snow and Ice Removal Act ; I will not repeat that all here.  But essentially, the ruling (at both courts) finds that the Act, which provides immunity and limits liability for negligent removal of naturally accumulated snow and ice, does NOT apply to limit liability for negligently creating an unnatural condition that causes ice to accumulate.  In this case, the plaintiff alleged that a faulty downspout installation caused the ice accumulation.  The Court is...

I recently met with some new clients (a married couple aged 60-70) to review their estate plan.  They had met with another attorney who prepared wills for them within the past year.  As we went over their estate planning goals and their previous wills, the first thing we discovered is that the wills they had prepared did not provide the bequest and specific gift terms they were looking for, and which they thought had been written into their wills. The second thing that stood out was a paragraph like this that the clients did not realize had been written into their wills (I'm paraphrasing): "Joe and Jane Testators have retained Larry Lawyer to prepare their wills, and they want Ed Executor and their family to continue to retain Larry Lawyer to handle probate of their estates." Now don't get me wrong, obviously when I help clients with estate planning, I certainly hope to be able to continue to help their families with probate and other legal issues that arise whe...