The life maintenance contract is becoming an increasingly relevant tool in the modern legal field, where social changes and demographic processes require new approaches to the protection of the rights of persons who find themselves in a special situation. This contract is not only a legal agreement, but a real life contract between the parties. It is able to determine both financial obligations and ethical and social aspects of relationships. However, the complexity of this legal instrument raises a number of questions: how predictable can be the legal status of the parties during the entire term of the contract? What mechanisms ensure the protection of the rights and interests of the parties? And most importantly, how to avoid situations when the contract becomes a source of disputes and legal conflicts?
Lawyers of the “Repeshko and Partners” Bar Association commented on the legislation and the correctness of concluding a lifetime maintenance contract, as well as analyzed its application, practical consequences and possible risks.
The main idea of a lifetime maintenance contract is to establish long-term obligations that cover not only material support, but also the guarantee of a decent standard of living. The war in Ukraine not only separated many families, so there are rare cases when elderly people are left alone in the country with their problems and troubles. Someone’s daughter left for Canada with her husband and children and has no intention of returning, and someone’s son died defending his native land. At the same time, not everyone has other close relatives (sisters, brothers, nephews, grandchildren, etc.), and if they do, they are not always eager to help an elderly relative or to help just like that, for a family connection alone.
There are already known cases when, left in such conditions, several friends-grandmothers found a rather interesting way out of the situation – they all together decided to live in the apartment of one of their friends, and to rent out their own apartments, distributing the received funds to everyone, or to cover their current needs. It is said that they even travel together on these funds. However, this option is not suitable for everyone, because not everyone has such like-minded girlfriends, not everyone has the desire to live together with a stranger, and the state of health of many is such that it is not suitable for traveling – at least someone would go to the store and cook a plate of soup.
Here it will not be superfluous to mention that there is a contract of lifetime maintenance. Article 744 of the Civil Code of Ukraine it has been established that under a lifetime maintenance (care) contract, one party (the alienator) transfers to the other party (the acquirer) ownership of a residential building, apartment or part thereof, other immovable property or movable property of considerable value, instead of which the acquirer undertakes to provide the alienator with maintenance and (or) care for life.
This contract is suitable in the case when there are relatives of a close degree of kinship who do not want to provide help just like that, as well as when an outsider wants to provide help in general, but wants to receive a significant bonus for the help, usually in the form of real estate. Although the law does not limit what exactly the expropriator can provide in exchange for assistance, usually the subject of such a contract is real estate – an apartment or a residential building. At the same time, in accordance with the norm of the law, it can be a vehicle, valuables, and any other valuable property.
Therefore, first of all, what an elderly person needs to make sure of, if he has decided to enter into a lifetime maintenance contract, is the title documents for real estate. There are many cases when, for example, it is not the daughter who comes after the mother, but the granddaughter after the mother and after the grandmother, to process the inherited real estate. Or a spouse bought a house in marriage for the husband, then he died, and the wife continues to live in it. That is, citizens simply live in a house or apartment for decades, pay utility bills, and do not think about anything else. That is why, to begin with, it is necessary to put the legal documents in order. Where the property is jointly owned, i.e. without determining the shares, these same shares must be determined between the co-owners at a notary or through the court.
All this is necessary due to the fact that the lifetime maintenance contract must be concluded with a notary. Moreover, some seniors think that the notary is simply taking their real estate title deeds into custody. No. This is not so! By signing a lifetime maintenance agreement with a notary public, you transfer ownership of your real estate to the person who will provide care. The purchaser will already be registered as the owner of the property in the real estate register, but the property will be seized (prohibition of alienation) until the death certificate of the elderly person is presented to the notary. Thus, the acquirer takes ownership of the alienator’s property from the moment the agreement is concluded, but cannot dispose of it (donate, sell, exchange, etc.) until the alienator’s death.
From this point of view, there are two news – good and bad. Good – the property transferred to the acquirer under the contract of lifelong maintenance (care) cannot be levied during the life of the alienator. And the bad – loss (destruction), damage to the property that was transferred to the acquirer is not a reason to terminate or reduce the scope of his obligations to the alienator. And one more thing – for some it is bad, and for some it is good – the property received by one of the spouses under a life maintenance contract during the period of marriage is the joint joint property of both. At the same time, it is assumed that maintenance is provided from the funds of the joint marital budget through joint efforts.
Now regarding the contract itself directly. According to the first part Article 749 of the Civil Code of Ukraine the contract of lifelong support (care) can specify all types of material support, as well as all types of care (guardianship), with which the acquirer must provide the alienator. According to the rules Article 751 of the Civil Code of Ukraine material support, which must be provided to the alienator on a monthly basis, is subject to a monetary assessment. But now we will talk about what is not written in the law – these are purely practical tips that are necessary for those who have decided to take care of someone for real estate. Yes, there are single grandparents. But they are lonely until they die. After death, it turns out that they have great-nephews, third cousins, and many others. Then the legal proceedings begin on the subject of whether the conditional grandmother was in her right mind when she entered into the contract.
There is another option – an elderly person is not satisfied with care – sour oranges or red caviar only on holidays. Here they are already starting to ask the question that after many years of care they want to terminate the contract due to improper care. Moreover, in such a case, it may be the case that the same grandmother wants to bargain for better conditions of care, or there are other persons behind this who want to get the grandmother with real estate, offering her really better care. Therefore, the first thing to do is to get the elderly person full medical care, including a psychiatrist. The certificates obtained will be a guarantee of common sense and mental state of the person. In the future, this will exclude legal delays due to the person’s incapacity at the time of the conclusion of the contract.
In the future, as precisely as possible, write down in the life maintenance contract exactly what assistance and for what amount of funds will be provided. Do not be afraid of this clause – it will protect all parties to the agreement. Here you can, for example, note the following:
- products and medicines in the amount of UAH 3,000 are provided every month, while each year the specified amount increases by 10% from January 1 (taking into account inflation),
- once a year, the following clothes are bought and given: shirt, pants, sweatpants, sweater, dress, etc.;
- once a week, the buyer does a full cleaning of the apartment, including wet cleaning;
- once a year, the buyer washes all the windows in the apartment, closes the curtains;
- if the alienator is in the hospital, the acquirer visits him every other day, bringing food and clean clothes.
The specific list of assistance will depend on what exactly the acquirer is ready to provide and what the alienator wants for his real estate – it can be only funds, or only assistance, or both.
In accordance with the law, 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. Purchasers under the lifetime maintenance contract can be several natural persons, in which case their obligation to the alienator is joint and several, and they become co-owners of the property transferred to them under the lifetime maintenance (care) contract, under the right of joint co-ownership. The buyer of the property under the contract can be such a person who can and is able to provide the alienator with the material security stipulated by the contract. So, for example, a person who, according to medical indicators, needs external care, an incapacitated person cannot be the acquirer.
The next step is to start a notebook, in which all the assistance provided will be recorded and the appropriate receipts will be pasted. At the same time, the pages of the notebook must be numbered and stitched. It is better if there are two identical notebooks – one for the acquirer and the other for the alienator. The entry in the notebook should look like this:
“12/22/24 – the following products were brought: loaf, 2 packs milk, 0.5 kg of butter, 1 kg of rolled biscuits, 3 kg of potatoes. The total amount spent is UAH 150, the check is pasted, the alienator has a signature.
28.12.24 – all the windows in the apartment are washed, the bed linen, curtains, tulle, alienator are washed – signature.”
All of the above will be needed if there is a question in court as to whether the alienator was properly cared for.
It is important to know that according to Art. 610 of the Civil Code of Ukraine a violation of an obligation is its non-fulfillment or fulfillment in violation of the conditions determined by the content of the obligation (improper fulfillment). According to the requirements Article 651 of the Civil Code of Ukraine modification or termination of the contract is allowed only with the consent of the parties, unless otherwise established by the contract or law. The contract may be amended or terminated by a court decision at the request of one of the parties in case of significant breach of the contract by the other party and in other cases established by the contract or the law.
Such a violation by a party of the contract is significant, when as a result of the damage caused by this, the other party is largely deprived of what it was counting on when concluding the contract.
Therefore, the lifetime maintenance contract can be terminated in two ways:
- Voluntarily. The parties go to the notary with whom the contract was concluded, the notary draws up the documents, the parties sign them, and the notary returns to the alienator his original title-establishing documents, which were selected when signing the lifetime maintenance contract.
- In court. A corresponding claim is submitted to the court, and after receiving a positive decision of the court on termination of the contract, the decision is brought to the notary with whom the contract of lifetime maintenance was concluded, and he returns the original documents and renews the entries in the real estate register.
According to paragraph 1 of the first part Article 755 of the Civil Code of Ukraine a lifetime maintenance (care) contract may be terminated by a court decision at the request of the alienator or a third party for whose benefit it was concluded, in case of non-fulfillment or improper fulfillment of his duties by the acquirer, regardless of his fault. In this case, the costs incurred by the acquirer for the maintenance and (or) care of the alienator are not subject to reimbursement.
Interpretation st. 755 CC indicates that the contract of lifelong support (care) can be terminated by a court decision, provided that the alienator proves the fact that the acquirer has violated his obligations under the contract of lifelong support (care), which can manifest itself in the form of incomplete or inadequate provision of care, assistance, food to the alienator or in the form of complete failure to perform the specified actions.
From the systematic analysis of the provisions of the specified norms and conditions of the contract, it can be seen that the basis for terminating the contract of lifetime maintenance is both complete non-fulfillment by the acquirer of the obligations assumed by him, and their improper fulfillment in comparison with the terms of the contract, regardless of the fault of the acquirer. At the same time, the obligation to prove the fact of proper fulfillment of the terms of the contract of lifelong maintenance, in accordance with part 3 Art. 12, ch. 1 st. 76 of the Code of Civil Procedure of Ukraine, relies precisely on the person who provides this maintenance.
Prescripts of ch. 1 Art. 756 of the Civil Code of Ukraine it is established that in case of termination of the contract of lifelong maintenance (care) due to non-fulfillment or improper performance by the acquirer of obligations under the contract, the alienator acquires ownership of the property that was transferred by him and has the right to demand its return.
The interpretation of paragraph 1 of the first part of Article 755 of the Civil Code of Ukraine indicates that a life-long support (care) contract can be terminated by a court decision, provided that the alienator proves the fact that the acquirer has violated his obligations under the life-long support (care) contract, which may manifest itself in the form of incomplete or inadequate provision of care, assistance, food to the alienator or in the form of complete failure to perform the specified actions.
Even the mere fact of monthly payments by the acquirer of funds for the maintenance of the property alienator cannot be considered as the proper fulfillment of the terms of the lifetime maintenance agreement and is a reason for its termination, if the terms of such an agreement provide for both the property maintenance of the alienator and the provision of care for him. This is confirmed by the Resolution of the Civil Court of Cassation of the Supreme Court dated 12.04.2018, case No. 759/14846/15-ts (proceedings No. 61-6294св18), the Resolution of the Civil Court of Cassation of the Supreme Court dated 15.05.2019, case No. 306/2548/14-ts (proceedings No. 61- 6315sv18).
It should be noted that hostile relations between the parties to a lifetime maintenance contract are grounds for terminating the lifetime maintenance contract. This is confirmed by the Resolution of the Civil Court of Cassation of the Supreme Court dated March 28, 2018, case No. 509/513/16-ts. The court examines this issue from the point of view that the alienator is counting on a comfortable old age, which is accordingly excluded in the event of hostile relations. Yes, practice knows a court case where the acquirer regularly morally abused the expropriator, in connection with which the police representatives were repeatedly called, who drew up the relevant protocols.
In case of impossibility of the natural person to further perform the duties of the acquirer under the contract of lifelong maintenance (care) for reasons of significant importance, the duties of the acquirer may be transferred with the consent of the alienator to a member of the acquirer’s family or to another person with their consent.
Thus, when deciding on the replacement of the acquirer, priority is given to members of his family. Another person can become the acquirer only with the consent of the alienator and the original acquirer. In the event of the death of a natural person-acquirer, the latter’s obligations under the lifetime maintenance (care) contract are transferred to those heirs to whom ownership of the property transferred by the alienator has passed.
If the heir by will refused to accept the property that was transferred by the alienator, ownership of this property may pass to the heir by law. If the acquirer has no heirs or they have refused to accept the property transferred by the alienator, the alienator acquires ownership of this property. In this case, the lifetime maintenance (care) contract is terminated.
A lifetime maintenance contract, as a legal instrument, opens up wide opportunities for ensuring social security and material support, but at the same time carries certain risks and challenges. Analyzing the experience of judicial practice, it becomes obvious that the successful conclusion of such an agreement requires careful study of all the nuances, consideration of individual circumstances and a clear definition of the rights and obligations of the parties.
