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Friday, May 6, 2011

Kate Sheppard residents plan legal action

Kate Sheppard residents plan legal action

Last updated 05:00 04/05/2011
Residents from an earthquake-damaged Christchurch retirement village are taking legal action to try to recover the value of their lost homes.

Kate Sheppard Retirement Village residents say they have been left homeless and broke after the village closed.

They have been told to expect payouts well under the value of their villas and apartments, leaving most unable to afford to buy elsewhere.

Like the elderly in similar complexes, the residents had bought a licence to occupy their units.

The Avondale village is owned by Christchurch businessman Lance Bunting, and residents paid a weekly fee for costs, including insurance.

Clive Murden, the son-in-law of village resident Doreen Endacott, said residents' families would get their first look at the village's insurance policy today and would then meet lawyers.

The residents' contracts with the village say they will get back the original price of their unit, less a set percentage.

In some cases, this will be less than half the market value because of inflation.

"They have been told they will get the same payment as if they had terminated the contract or died, but this was an act of God and they did not decide to move out," Murden said.

"No-one will talk to us – not the Government, the insurers, the EQC [Earthquake Commission] or the owner.

"These residents need someone to step in and solve this."

He hoped to hear from more residents, who were now "scattered to the winds", staying with friends or family around the country and even overseas.

Lawyers had indicated the case was "not as cut and dried" as first thought, Murden said.

"Because [residents] have a contract and have paid insurance, we believe they have an insurable interest," he said.

The insured value of the complex has been estimated at between $25 million and $30m. The retirement village is a separate business from the rest home on the site, which also closed after the February quake.

Doug Guthrie, whose mother-in-law was a resident of the village, said the families needed to band together, but he did not hold out hope of successful legal action.

Guthrie said his mother-in-law was feeling isolated living with him and his wife in the country because they worked.

"She thinks she has lost everything and she doesn't know what to do," Guthrie said.

"Like everyone else, she won't have enough money to get another home because of the shortfall.

"This will leave most people high and dry."

Terry Waghorn, whose mother, Joyce, lost her unit at Kate Sheppard, said he expected insurance payouts would be months away and believed there was "little hope" of getting more than the legal entitlement.

Bunting said he was still "working through issues" with insurers and was keeping residents informed.

He did not want to comment on how much residents would be paid out for lost homes.

"We just don't have all the facts yet.

"It's quite complicated, but people are entitled to get whatever advice they like," Bunting said.

"Obviously they are frustrated."

Bunting has a majority interest in another retirement village under construction in Papanui.

- The Press

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