No problems in retirement paradise?
HONEYDEW – The Belvedere Retirement Village Group has come under fire for not paying out life right owners.
Family members of lessees in the Belvedere Retirement Village Group villages have complained that they are not receiving the money they are owed when their elderly relations no longer reside at the retirement villages.
Chris Paton, the son of a life rights owner, was one of the family members who complained when there was no indication of when the money owed would be paid after his father died.
Paton was paid out a few days after the payment date he was given (31 January 2016). This was approximately eight months after he had given up the unit.
Paton commented that the misleading factor is the ‘after 30 days’ clause in the contract. Paton said there are about eight to 10 people who he had spoken to, who had similar issues.
Juliana Steyn, the in-house attorney for Belvedere Retirement Group, explained the contract life right owners (retired persons) sign is based on the strict Act 65 of 88 of the Housing Development Schemes for retired persons.
Tenants are sold the life rights to a property, which is never transferred into the tenant’s name. The sum that is paid to Belvedere for the property is the equivalent of paying rent up front, in full. The lump sum is paid back when the tenant dies or moves out, and occasionally an amount is deducted for maintenance.
According to the above mentioned Act, the life right owners have the same rights as a lessee.
In the contract signed by the life right owners, it is stipulated the sum paid to Belvedere will be paid out ‘after 30 days’ within a reasonable time, where, according to Steyn, the longest time it has taken Belvedere to pay out is six months after the life right of the particular unit has been sold to a new life right holder and the whole new “loan” amount has been received.
In a case where the tenant needs the money desperately for hospital bills or frail care, arrangements can be made where there is no waiting period to receive the sum.
Steyn explained that six months is a reasonable time as a normal estate takes two to three years to wrap up. “We have 900 units and there has never been a person that has not been paid. Our clients do not normally complain. Children or family members can sometimes cause a problem,” Steyn added.
Steyn explained that problems can arise when family members attempt to take over a contract they did not sign. Additionally, to make demands, a family member would need the power of an attorney. In these cases, receiving the money can take more time. “Our track record shows nothing to be scared of,” Steyn concluded.
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