Palm v. 2800 Lake Shore Drive Condo. Ass'n

• Decision Date: 25 April 2013
• Docket Number: No. 110505.,110505.
• Citation: Palm v. 2800 Lake Shore Drive Condo. Ass'n, 2013 IL 110505, 988 N.E.2d 75, 370 Ill.Dec. 299 (Ill. 2013)
• Parties: Gary PALM, Appellee, v. 2800 LAKE SHORE DRIVE CONDOMINIUM ASSOCIATION et al., Appellants.
• Court: Illinois Supreme Court

2013 IL 110505

988 N.E.2d 75

370 Ill.Dec. 299

Gary PALM, Appellee,

v.2800 LAKE SHORE DRIVE CONDOMINIUM ASSOCIATION et al., Appellants.

No. 110505.

Supreme Court of Illinois.

April 25, 2013.

Mark D. Roth, Orum & Roth, LLC, Chicago, for appellants.

Gary H. Palm, Chicago, appellee pro se.

Mara S. Georges, Corporation Counsel, Chicago (Benna Ruth Solomon, Myriam Zreczny Kasper, Christopher S. Norborg, of counsel), for intervenor-appellee.

OPINION

Chief Justice KILBRIDE delivered the judgment of the court, with opinion.

[370 Ill.Dec. 301]¶ 1 The primary issue in this appeal is whether a City of Chicago ordinance allowing condominium unit owners to inspect condominium association financial books and records is a valid exercise of the City's home rule power. We affirm the appellate court's holding that the City's ordinance is valid and enforceable. We also affirm the appellate court's decision that the trial court did not err in awarding the plaintiff interim attorney fees.

¶ 2 I. BACKGROUND

¶ 3 Plaintiff Gary Palm owns a unit in the 2800 Lake Shore Drive condominium building in Chicago. He served on the board of directors of the condominium association from 1992 to 1998.

¶ 4 On September 15, 1999, Palm sent a letter to the president of the Association board of directors asking for production of specific documents and records related to the building's management. Palm explained that he needed the documents to investigate the board's actions, including whether: (1) the board awarded contracts improperly; (2) the board used improper investment and banking practices; (3) the board held unlawful private meetings; (4) board president Kay Grossman used Association funds without proper approval; (5) the 1998 board election was compromised by “irregularities or improprieties”; and (6) legal action should have been pursued against the builder.

¶ 5 When his request was denied, Palm filed a complaint seeking to examine, inspect, and copy the documents. The Association moved to dismiss the complaint, and the circuit court of Cook County dismissed it without prejudice.

¶ 6 Palm then filed a four-count first amended complaint. In count IV, the only claim at issue in this appeal, Palm challenged the denial of his request for production of documents. Palm sought an order compelling production of the documents under various laws, including a provision of the City's condominium ordinance. The ordinance allows condominium unit owners to inspect a condominium association's financial books and records within three business days of delivering a written request to examine the records. Chicago Municipal Code § 13–72–080 (2009).

¶ 7 The Association moved to dismiss the complaint under section 2–615 of the Code of Civil Procedure (735 ILCS 5/2–615 (West 2000)). On December 11, 2000, the trial court granted the motion to dismiss all four counts of the complaint, ruling that section 107.75 of the General Not For Profit Corporation Act of 1986 (805 ILCS 105/107.75 (West 2000)) preempted the City's ordinance and Palm was not entitled to the requested documents under that statute. The trial court allowed Palm 14 days to file a second amended complaint.

[370 Ill.Dec. 302]¶ 8 On December 19, 2000, Palm filed a motion to reconsider the dismissal of his first amended complaint. The City petitioned to intervene to defend the validity of its ordinance and submitted a brief in support of Palm's motion to reconsider. The trial court allowed the City to intervene.

¶ 9 The trial court entered an order on April 3, 2001, stating it had reconsidered the previous dismissal order. The trial court dismissed with prejudice counts I, II, and III of the first amended complaint. Count IV was dismissed without prejudice and Palm was given until April 17, 2001, to file a second amended complaint. The trial court denied the City's request for a finding under Supreme Court Rule 304(a) (Ill.S.Ct. R. 304(a) (eff. Feb. 1, 1994)) that there was no just reason to delay an appeal.

¶ 10 On April 17, 2001, Palm filed a motion to reconsider the order entered on April 3, 2001. A new trial judge was assigned due to the retirement of the original judge. The trial court granted Palm's motion in part, vacating the dismissal of count IV based on its finding that the City's ordinance was a valid exercise of its home rule authority and the ordinance was not preempted by a state statute. The Association's motion to dismiss was, therefore, denied.

¶ 11 The trial court later granted in part Palm's motion for summary judgment on count IV of his complaint. The Association was ordered to produce the requested documents as required by the City's ordinance.

¶ 12 Palm petitioned for an award of interim attorney fees, alleging that as the prevailing party he was entitled to fees under the ordinance. Palm submitted that $300 per hour was reasonable and appropriate. He acknowledged that he paid his attorney in accordance with a fee agreement at a rate of $200 per hour, but claimed it was a reduced rate. He asserted that when attorney fees are recoverable under a statute, it is typical for a fee agreement to provide for a reduced hourly rate with reasonable attorney fees determined upon completion of the case.

¶ 13 Palm's petition further alleged that the fee award would be retained by his attorney. According to the petition, Palm would receive no part of the award other than reimbursement of his actual payments to his attorney. Palm submitted an affidavit of retired Cook County Circuit Court Judge Kenneth L. Gillis, asserting that the rate of $300 per hour was “well within the prevailing market rates charged in comparable cases by Chicago attorneys of similar qualifications, skill and experience.”

¶ 14 On August 26, 2008, the trial court granted Palm's interim fee petition under the ordinance. Palm was awarded attorney fees at the rate of $300 per hour. The trial court certified for immediate appeal under Supreme Court Rule 304(a) the order granting Palm partial summary judgment on count IV of his complaint and the award of interim attorney fees.

¶ 15 The appellate court held that the Chicago ordinance authorizing inspection of the Association's records was a valid exercise of the City's home rule power and the trial court did not abuse its discretion in entering the award for interim attorney fees. Accordingly, the appellate court affirmed the trial court's judgment. 401 Ill.App.3d 868, 340 Ill.Dec. 990, 929 N.E.2d 641.

¶ 16 We allowed the defendants' petition for leave to appeal. Ill. S.Ct. R. 315 (eff. Feb. 26, 2010).

¶ 17 II. ANALYSIS

¶ 18 A. Jurisdiction

¶ 19 First, we identified a potential jurisdictional issue in our initial review of the briefs in this case. The briefs describe a complicated procedural background suggesting that the trial court may have entered a final judgment on April 3, 2001. The briefs indicate that the April 3, 2001, order denied the motion to reconsider the dismissal of the first amended complaint. According to the briefs, that order was followed by a second motion to reconsider filed more than 30 days later on May 8, 2001.

¶ 20 The jurisdictional concerns were raised by this court during oral argument, and we subsequently entered an order allowing the parties to file supplemental briefs addressing whether the circuit court lost jurisdiction before entering the orders subject to this appeal. The parties filed supplemental briefs clarifying that the April 3, 2001, order dismissed count IV without prejudice and with leave to refile. The parties assert that the order was not a final judgment subject to appeal and the trial court never entered a final order dismissing count IV of the first amended complaint. The parties, therefore, agree that the trial court did not lose jurisdiction before entering the orders subject to appeal in this case.

¶ 21 The jurisdictional concerns that arose in our initial review of this case centered on whether the April 3, 2001, order constituted a final judgment. A civil ruling is final if it terminates the litigation and fixes the parties' rights leaving only enforcement of the judgment. In re Detention of Hardin, 238 Ill.2d 33, 42–43, 342 Ill.Dec. 555, 932 N.E.2d 1016 (2010). A review of the record confirms that the April 3, 2001, order dismissed count IV of the first amended complaint without prejudice and with leave to refile. An order dismissing a complaint with leave to amend is not a final judgment. See Smith v. Central Illinois Regional Airport, 207 Ill.2d 578, 585–87, 280 Ill.Dec. 325, 802 N.E.2d 250 (2003). The order did not terminate the litigation or fix the parties' rights. Additionally, the order was subject to reconsideration by the trial court at any time prior to entry of a final judgment. See Towns v. Yellow Cab Co., 73 Ill.2d 113, 119–21, 22 Ill.Dec. 519, 382 N.E.2d 1217 (1978). Thus, after reviewing the record, we agree with the parties that the trial court did not lose jurisdiction before entering the orders subject to this appeal.

¶ 22 B. Validity of Ordinance

¶ 23 The central issue in this appeal is whether the Chicago ordinance allowing condominium unit owners access to association financial books and records is a valid exercise of the City's home rule power.¹ The defendants contend that the ordinance conflicts with and renders unenforceable within the City of Chicago portions of the Condominium Property Act ( 765 ILCS 605/1 et seq. (West 2000)) and the General Not For Profit Corporation Act of 1986. Those statutes require condominium unit owners to state a proper purpose for obtaining association financial books and records, require production of only 10 years of records, and allow an association 30 days to gather and produce the records. Under the Chicago ordinance, a unit owner is not required to state a proper purpose for requesting the records, there is no restriction on the age of the documents, and the documents must be produced within three business days of the request. The defendants contend...