care, loyalty, and good faith, and to treat the owners as well as they would treat themselves. Boucher v. 111 East Chestnut Condominium Ass’n , 2018 IL App (1st) 162233, ¶ 36. Defendants’ alternative theory of the case was that they were protected by the business judgment rule. That rule protects directors against liability where they have been careful and diligent in performing their duties, and have not been guilty of bad faith, fraud, illegality, or gross over- reaching. Palm v. 2800 Lake Shore Drive Condominium Ass’n , 2014 IL App (1st) 111290. ¶ 111. The Appellate Court likewise rejected that theory, because the essence of the complaint against the defen- dants was that they engaged in precisely that kind of misconduct. Bottom line in Kai : Because the theory of breach of fiduciary duty was held to be well taken, the Appellate Court concluded that plaintiff could proceed with her cause
of action for breach of fiduciary duty and also with her causes of action for construc- tive fraud and civil conspiracy. Dismissal of those three counts was reversed. The court stated that a fourth cause of action, for rescission, also would be proper; how- ever, because of the passage of time the court held that it would not reverse as to that count. Nevertheless, Kai represents a substantial victory for condominium until owners and a substantial defeat for condominium deconverters. Unpublished rules Finally, one other aspect of Kai is impor- tant. Defendants extensively relied upon an unpublished Rule 23(e) decision, Hughes v. Cloonlara-Hughes Ltd Partnership , 2016 IL App (2d) 150715-U. Such decisions prior to January 1, 2021 are not to be cited as precedent or for their stare decisis effect. The Appellate Court admonished defen- dants with the oft-repeated statement that
Supreme Court Rules are rules, not sug- gestions; that they have the force of law; and they must be obeyed and enforced as written. Accordingly, the court disregarded all portions of defendants’ arguments based on Hughes. Let this be an admonishment to legal researchers everywhere: When you find a pre-2021 absolutely perfect decision with a -U at the end of the citation, don’t waste your time; just turn the page and keep searching. Richard Lee Stavins practices law in Chi- cago, where he con- centrates on trial and appellate litigation. He is a shareholder at Rob- bins, Solomon & Patt Ltd., a 50-year CBA member, and serves on the Editorial Board of the CBA Record.
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