[RPPTL LandTen] Arbitration Clauses in the residential setting

[Arlene C. Udick]

I have a client that executed a personal right to live contract in a
continuing care retirement facility.  The contract is clear that it is not a
lease nor an easement, I would describe it as a license.  There is a monthly
fee to live in one of the units.  There is also an Entrance Fee of almost
$400,000.00 of which he paid 10% when he signed the agreement.  The contract
was executed 1/30/2008.  There is no beginning date.  There might be
additional information that the client has not provided.

 

He was planning on paying the Entrance Fee with the proceeds from the sale
of his residence.  No surprise, his residence has not sold, despite being on
the market since 2008.  No contingencies.  He would like to cancel the
agreement.  There is a provision that allows him to cancel upon payment of
4% of the total Entrance Fee, which is deducted from his deposit.  This is
$16,000.

 

90% of the Entrance Fee is returned to him when he dies, or otherwise
cancels the agreement.  Now he wants out.  Could the argument of failure of
consideration work to void the contract?  He gets nothing in return for the
management holding or using those funds.   Your thoughts, please.  Thanks.
Arlene

 

 

Arlene C. Udick, Esq.

P.O. Box 2094

The Villages, FL 32158-2094

(O) 352-391-1888

(F) 352-391-9128

 

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