Lifetime maintenance agreement, gift or will: how to get the right to the real estate of an elderly person in exchange for care

The choice of legal mechanisms for the transfer of real estate is often faced by elderly people who need care and support. In such cases, a lifetime maintenance agreement is one of the popular ways to ensure proper care in exchange for the transfer of ownership. At the same time, many people turn to alternative options, such as a gift or a will, which allow the transfer of property under different conditions. However, each of these options has its own risks and benefits, both for the property owner and the heirs.

Lawyers of the “Repeshko and Partners” Bar Association will help you understand the legal nuances of each of the options so that you can make the most informed decision.

Unfortunately, in connection with the military operations on the territory of Ukraine, the population is not only decreasing, but those who remain are mostly not young. Yes, according to the data of the UN Population Fund on 2023 year, population of Ukraine has 36.7 million people, of which more than 20% are people over 65 years old. In fact, there are much more elderly people, because the given data were not obtained through the population census, but according to secondary indicators. The events that are currently tearing our country apart have led to the fact that many of the elderly are left alone. The reasons for this are different – the death of relatives from military operations, the death of loved ones in military service in the ranks of the Armed Forces of Ukraine, or going abroad with a one-way ticket.

In turn, there are many individual citizens and entire families in the country who have lost their homes. It can be an apartment with windows facing the river that was blown up by a rocket, or an abandoned house with an apple orchard. The main and most terrible thing is that such people have nothing. In the conditions that have developed, they are trying to find a way out of the impasse and get at least some housing and confidence in the future. So, one of the options is to take care of an elderly person for the right to take ownership of their real estate.

It should be noted that even local citizens in calmer regions of the country do not reject such an option as a means of improving their financial situation. Here’s a real story: Kateryna got a job at “Miloserdya” – an organization that officially takes care of lonely elderly citizens, and received Zinaida Vasilievna as a ward, who, although she had only one sister among her relatives, did not maintain close communication with her – their personalities did not match. Kateryna worked at “Miloserda” for six months and resigned. It was at this time that Zinaida Vasylivna wrote a will at a notary, in which she bequeathed all her property – a house in a fairly small town – to Yevgenia, Kateryna’s daughter. Since that time, Zinaida Vasylivna was visited not only by “Mercy”, but also sometimes by Kateryna as a private person.

In less than two years, Zinaida Vasylivna died, and Evgenia became the owner of the apartment building. However, this method of obtaining real estate is not something new or exclusive. We were contacted by a client whose family has been caring for single grandparents since the 90s. She looked after really well – they themselves passed on information about a good carer, and the family thus got ownership of about twenty apartments in one of the cities with a million inhabitants.

What to do when there is a person who wants to look after someone for real estate and a single elderly person who wants to be looked after for real estate?

The main thing to do is to check everything well and arrange it correctly.

A person who wants to care needs to find out:

• whether the right of ownership of housing is fully or partially owned by a single person;
• whether the housing documents are properly issued for the person who wants to receive care;
• whether a single person is really ready to go to the notary tomorrow and draw up a care agreement properly;
• whether the single person has previously entered into a care agreement with someone.

The last point needs to be clarified due to the fact that there are individuals who have already tried to take care of ten people, but with each of them, after some time, the agreement was broken, because the red caviar seemed too small to a single person, and the meat was not cooked enough.

A lonely elderly person who wants to be looked after needs to find out:

• what kind of people are there who intend to take care of it, whether they have done it before and how successfully;
• what kind of help can be provided after discussing all the nuances: paying utility bills, personal assistance, buying medicine, providing cash, providing ready-made food, etc.

How to legally correctly draw up the specified agreement

There is an opinion among the population that these relations can be formalized in one of the following ways:

• donation contract;
• by will;
• lifetime contract.

From a legal point of view, only one option is correct – a lifetime maintenance contract. But not everyone and not always want to sign exactly him. So let’s weigh all the risks.

Gift contract. According to Article 717 of the Civil Code of Ukraine, “Under a gift contract, one party (donor) transfers or undertakes to transfer property (gift) to the other party (donee) free of charge in the future.” A contract that establishes the obligation of the donee to perform any property or non-property action for the benefit of the donor is not a gift contract.” The contract of donation of an immovable thing is concluded in writing and is subject to notarization.

So, as we can see, the donation contract is free of charge – the person who received the thing as a gift does not owe anything to the donor. Such an agreement is infinitely beneficial to the person who cares and extremely unbeneficial to the person being cared for. In addition, the donee (caregiver) becomes the owner of real estate immediately after leaving the notary and can sell, gift or mortgage it after five minutes. The fate of the donor in this case is under great question. Although from the point of view of the donee (caregiver), this version of the agreement is the most reliable in some cases. In addition, according to Article 728 of the Civil Code of Ukraine, “One-year statute of limitations applies to demands for termination of a gift contract.”

Will. According to Article 1233 of the Civil Code of Ukraine, “A will is a personal disposition of an individual in the event of his death.” Based on this norm, we see that the will is effective in the event of a person’s death. The will must be certified by a notary public. Everything that was “scribbled” on a piece of paper before death without a notary’s seal has nothing to do with the will. A will is extremely beneficial to the person being cared for. The fact is that the text of the will can be rewritten at least every day at a notary’s office – there are no restrictions, just pay the money. In addition, the person to whom the will is drawn up is not warned about the execution of the will in his favor, nor about its cancellation, as the testator himself will not say about this, and will not hand over a copy of the will in person. However, tomorrow he can deliver the will to your neighbor. When making a will, the testator remains the owner and remains so until the moment of death. Until that moment, he can freely dispose of his real estate, but there may be a situation when a will was written yesterday for a neighbor who is a caregiver, and today the apartment was given to a great-niece.

Another unforeseen moment is the mandatory share in the inheritance, which is directly provided for in Article 1241 of the Civil Code of Ukraine: “Minors, minors, adult disabled children of the testator, disabled widow (widower) and disabled parents inherit, regardless of the content of the will, half of the share that would belong to each of them in case of inheritance by law (mandatory share). The size of the mandatory share in the inheritance can be reduced by the court, taking into account the relationship between these heirs and the testator, as well as other circumstances that are of significant importance. Therefore, even if there is a will for the entire property, it is possible to become the owner of only a part of it in fact.

It is impossible to say categorically that these two options do not have the right to exist. Everything depends on the degree of kinship of the parties, the depth of trust, the presence of other relatives of various degrees of kinship, including the “seventh water on the jelly”, as well as the physical and financial components for court proceedings if necessary.

Lifetime maintenance contract. But the legislation directly provides for the case we are considering – Article 744 of the Civil Code of Ukraine: “Under a lifetime maintenance (care) contract, one party (the alienator) transfers ownership of a residential building, apartment or part thereof, other immovable property or movable property to the other party (the acquirer) , which has a significant value, in exchange for which the acquirer undertakes to provide the alienator with maintenance and (or) care for life.

The lifetime maintenance (care) contract is concluded in writing and is subject to notarization.

All types of material support, as well as all types of care (guardianship), with which the acquirer must provide the alienator, can be defined in the lifetime maintenance (care) contract. If the duties of the acquirer have not been specifically defined or in the event of a need to provide the alienator with other types of material support and care, the dispute must be resolved in accordance with the principles of justice and reasonableness. The acquirer is obliged to bury the alienator in the event of his death, even if this was not provided for in the lifetime maintenance (care) contract.  The acquirer may be obliged to provide the alienator or a third person with housing in the house (apartment), which was transferred to him under the lifetime maintenance (care) contract. In this case, the contract must specifically specify that part of the residence in which the alienator has the right to live. Material support, which must be provided to the alienator on a monthly basis, is subject to a monetary assessment. Such assessment is subject to indexation in accordance with the procedure established by law.

Although under a lifetime maintenance contract, the person who takes care of the property immediately becomes the owner of the property, but until the death of the alienator, a lien is imposed on the immovable property, which is removed only upon presentation of the death certificate of the alienator.

But here too there is a caveat! If the person providing care is married, then the property received for care is joint joint property of the spouses, because such assistance, be it medicine, food or money, is provided from the joint family budget.

A real court case: the grandmother entered into a lifetime maintenance contract with her grandson (her only close relative), while of course the previous documents certifying the right to ownership of the house remain in the notary’s archive, and the buyer receives the lifetime maintenance contract. The grandson wanted to own an apartment, but because of his age, he could not take care of his grandmother very well – there was also the question of who looked after and fed whom. After a while, the grandmother got tired of all this, plus the grandson felt like the owner of the situation, and the grandmother went to the notary with only one request – return my documents for the apartment! Of course, the notary sent the grandmother to court, and she had to explain for a long time to her constantly repeated mantra: “Just give me my documents for the apartment!”, that together with the documents, she had already given the ownership right to the apartment, it does not belong to her, and grounds are needed for its return .

The main practical recommendation for this agreement is to start a notebook. In this notebook, you need to write down the date when the person you are caring for was visited, what was brought and given to her (mashed potatoes, three chicken cutlets, a loaf of bread, half a kilo of cookies, half a kilo of candy) or where and for what she was taken. At the same time, it is advisable to immediately stick receipts for used medicines, products or for a new frying pan. All this must be signed by the person being cared for every time. This will be one hundred percent proof of proper care according to the terms of the contract.

There is an example when a completely decent and normal grandmother offered a neighbor to take care of her apartment back in the 90s. The sadness of the situation was that in the middle of the 2000s, a neighbor died, to whom the grandmother offered housing for care, and the grandmother was still alive long after that. Therefore, when embarking on this path of obtaining ownership of real estate, realistically assess your strength and financial capabilities, as well as heredity and the state of health of the person you intend to take care of.

We would also like to remind you that there are no agreements that cannot be challenged in court. The main thing in this matter is the grounds on which the document is contested. It is possible to say that the donation contract is fake, but in reality it was intended to be a lifetime maintenance contract, or it was misled by saying that a lifetime maintenance contract was being signed, but a donation was signed.

The will is disputed due to the fact that at the time of its signing, the person was not in control of his actions and could not evaluate them realistically, because he was under the influence of medical drugs or in connection with an extremely painful condition. A contract for lifelong care can be contested by a person who is provided with care due to the fact that it is not provided to him or is provided to him in an insufficient amount. And this is not a complete list of possible variations.