Hanson v. Tempe Life Care Village, Inc. – 7/12/2007

July 23, 2007

Arizona Court of Appeals Division One Holds That, Under The Terms Of The Contract Between A Resident And Her Retirement Care Facility, The Resident Is Entitled To A Full Refund Of Her Entrance Fee After Giving Timely Written Notice And Vacating The Facility.

The estate of Amy Hanson sought reimbursement for the entrance fee that Hanson had paid to her former care facility because she gave timely written notice to the facility and vacated her room. After the facility denied its requests, the estate filed an action for breach of the refund provisions of the residency contract. The trial court granted summary judgment for the facility and awarded attorneys’ fees without explanation or oral argument.

The Arizona Court of Appeals reversed. It held that, under the terms of the addendum to the residency contract, the estate was entitled to a refund of the entrance fee and was not responsible for monthly fees after the decedent had vacated the premises. According to the court, the facility’s proffered construction to the contrary was inconsistent with the terms of the parties’ addendum. Because the facility was no longer the prevailing party under A.R.S. § 12-341.01, it was no longer eligible to recover its attorneys’ fees. The court instead awarded the estate its reasonable attorneys’ fees incurred on the appeal.

Judge Irvine authored the opinion, which Judges Portley and Kessler joined.