Section 901.4 - Refunds

901.4 Refunds. Any funds paid by or on behalf of a resident or prospective resident shall be refundable as follows:

(a) An application fee or other similarly designated processing fee shall be subject to the refund provisions specified in the contract.

(b) Entrance fee deposits shall be refundable as follows:

(1) Entrance fee deposits shall be fully refundable if the contract is cancelled within seventy two hours of its execution.

(2) If the prospective resident dies or through illness, injury or incapacity is precluded from becoming a resident under the terms of the contract, the contract is automatically rescinded and the prospective resident or his or her legal representative shall receive a full refund of all moneys paid to the operator, except for those costs specifically incurred by the community at the request of the prospective resident or representative and set forth in writing in a separate addendum to the contract, signed by both parties to the contract. In the event of a multiple party contract, the contract may remain in effect at the option of the remaining prospective residents, subject to the terms of the contract.

(3) If the contract includes more than one resident, and one of the prospective residents dies or through illness, injury or incapacity is precluded from being a resident under the terms of the contract, the remaining resident(s) may cancel the contract and shall receive a full refund of all moneys paid to the operator, except for those costs specifically incurred by the community at the request of the prospective resident(s) or representative(s) and set forth in writing in a separate addendum to the contract, signed by all parties to the contract.

(4) If the community is not substantially complete as evidenced by meeting the requirements of subdivision (e) (1-3) of Section 901.3 of this part within six months of the completion date specified in the initial disclosure statement which was issued to the prospective resident or his or her legal representative the resident or representative shall have the option of cancelling the contract. In this case, the resident or representative shall receive a full refund of all moneys paid including earned interest, except for those costs specifically incurred by the community at the request of the resident or representatives and set forth in writing in a separate addendum to the contract, signed by both parties to the contract.

(c) Subsequent to occupancy, the contract shall be cancelled upon death of a resident in a singly occupied unit; or at least a thirty day written notice by certified mail by the resident or his or her representative for any reason; or by the operator if the resident has willfully mismanaged assets needed for payment of monthly care fees. The resident may not be discharged for inability to pay the monthly care fee except where the operator can demonstrate willful mismanagement of assets needed to pay the monthly care fee by the resident. Upon receipt of the required notice or upon the death of the resident, the operator shall provide for refund of any funds received as follows:

(1) If the required notice is received or if the death of a resident in a singly occupied unit occurs within the first ninety days of occupancy, the refund shall be at least equal to the entry fee and any other prepayment less the actual cost of any services rendered and the actual cost of refurbishing the living unit for resale;

(2) If the required notice is received or if the death of a resident in a singly occupied unit occurs after the first ninety days of occupancy, any refund shall be not less than the entrance fee, except that the operator may retain no more than two percent per month of occupancy by the resident of such fee and no more than a four percent fee for processing; and

(3) Any refund made subsequent to occupancy must be made within thirty days of the resale of the living unit, but in no event later than one year after the unit has been vacated.

(d) Subsequent to occupancy, if a resident who is party to a multiple resident contract either dies or otherwise vacates the unit, the contract shall remain in effect at the option of the remaining resident(s), subject to the terms of the contract. In the event that the remaining resident(s) cancel the contract, refunds shall be provided subject to the provisions of subdivision (c) of this section..

(e) Any refund provisions not herein specified, shall be subject to the terms of the life care contract.
 

Effective Date: 
Wednesday, July 1, 1992
Doc Status: 
Complete