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CCRC can continue collecting fees pending litigation

September 30, 2015
by Nicole Stempak, Associate Editor
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The North Carolina Supreme Court declined to take on the case involving The Cedars of Chapel Hill, a continuing care retirement community (CCRC) emboiled in a class-action lawsuit alledging excessive fees.

For now, North Carolina Court of Appeals decision stands, and the CCRC will be allowed to continue collecting its membership and monthly overhead fees while the case is sent back to Orange County Superior Court for a possible jury trial instead.

The court will consider whether the community’s contract is “so oppressive that no reasonable person would make them on the on the one hand, and no honest and fair person would accept them on the other,” according to a Raleigh News & Observer story about the lawsuit.

At issue is the membership fees collected when a condominium at the CCRC is sold. The CCRC currently charges a fee of 10 percent of the gross purchase price. Residents also pay a monthly fee for certain amenities.

Residents have paid more than $35 million since 2004, according to Raleigh attorney Benjamin Kuhn who filed the original lawsuit on behalf of the two families in June 2011. Kuhn claims those fees violate state law. He now represents a class-action group of several hundred people.