Holding 3: misuse of association funds is a derivative claim

Misappropriation of association funds is an injury to the association. Owners must sue derivatively; a direct individual claim fails even where the alleged misuse benefited one class of owners over another, because the funds belonged to the association. The court cited Poulet v. H.F.O. and Small v. Sussman.

This is now published authority a board can cite on a motion to dismiss, and it is the holding most likely to be used in the next twelve months. The typical Illinois owner suit — “the board spent our money on the wrong thing” — is pleaded directly, and Bogot says it should not be.

Holding 4: the master-association trap

This is the one that will surprise boards.

Under 765 ILCS 605/18.5(a), an association that exercises powers “for the benefit of the unit owners of one or more condominiums” is a master association governed by the Condominium Property Act — and, in the court's words, “the declaration's own characterization that defendants are not a master association is immaterial.”

The court further held the Common Interest Community Association Act, 765 ILCS 160/1-1, does not require severing condominiums from a mixed association.

Why holding 4 is a live compliance problem

Illinois has a large number of mixed communities — single-family homes, townhouses and one or more condominium buildings under a single umbrella association — and many of their declarations expressly disclaim master-association status. That disclaimer was often deliberate, drafted to keep the umbrella entity under the Common Interest Community Association Act rather than the Condominium Property Act.

Bogot says the disclaimer does nothing. The status turns on what the association does, not what its declaration calls it.

The consequence is that such an association may be subject to Condominium Property Act obligations it has never applied to itself — among them the Act's meeting, records, budget and reserve provisions, and the duties in Section 18.4. A board in this position should have counsel read Section 18.5(a) against its actual functions rather than against its declaration's recitals.

What the case as a whole means for boards

Follow your own formula. The through-line of all four holdings is that Haverford won because it did what its declaration said. Illinois courts this year have repeatedly punished associations for the opposite — a design committee that banned what its declaration permitted, a developer that used a scrivener's-error clause to enlarge its own rights, a board that liened for charges a court had said were not assessments.

An unequal deal is not an illegal deal. Owners who believe their share is unfair have a governance remedy — amend the declaration — not a judicial one.

What to watch next

No petition for leave to appeal appears in the Supreme Court's dispositions through September 9, 2026. This is published and precedential, and unless the Supreme Court takes it, it is the law.