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Civil law. Part II. Lifetime annuity agreement (most important)

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32. LIFE RENTAL AGREEMENT

subject of a contract life annuity differs from the subject matter of a permanent annuity agreement only in the requirements imposed on the annuity. The requirements for property transferred into the ownership of the payer have not been changed.

Requirements for rent in a life annuity agreement:

▪ rent can only be expressed in monetary terms;

▪ the amount of rent is at least one minimum wage per month (clause 2 of Article 597 of the Civil Code), it can increase in accordance with the rules provided for in Art. 318 Civil Code;

▪ the rent payment period is at the end of each calendar month, unless otherwise provided by the contract (Article 598 of the Civil Code).

Period The life annuity agreement is limited to the period starting from the moment of conclusion of the agreement and ending with the moment of death of the recipient of the annuity.

The subject composition of the recipient of the rent is more limited in comparison with a permanent rent agreement: only a citizen can act as a rent recipient.

Subject composition of the payer the same: all subjects of civil law can act as a payer.

Recipient rights life annuity:

▪ demand from the payer payment of rent on time and in full;

▪ receive the share of a deceased annuity recipient (co-shareholder), if there were several annuity recipients;

▪ demand from the payer in case of improper performance of the contract:

a) the return of this property with an offset of its value against the redemption price of the rent (clause 2 of article 599 of the Civil Code);

b) redemption of property according to the rules provided for in Art. 594 of the Civil Code for the redemption price of a permanent rent, or termination of the contract and compensation for losses (clause 1 of article 599 of the Civil Code).

The right to receive a life annuity does not pass by inheritance and cannot be transferred by assignment of a claim during the lifetime of the recipient of the annuity.

Grounds for termination of the contract life annuity:

▪ death of the last annuity recipient (the death of the annuity payer does not terminate the obligation to pay annuity, it passes to the heirs of the deceased payer);

▪ the demand of the annuity recipient to repurchase the annuity in the event of a significant violation of the contract by the payer (clause 1 of Article 599 of the Civil Code) under the terms of Art. 594 Civil Code.

The loss of property transferred under rent does not terminate the contract, regardless of whether its transfer is for compensation or gratuitous.

For late payment of rent, the payer of rent shall pay to the recipient of the rent interest, the amount of which is determined by the rate of bank interest existing at the place of residence of the recipient of the rent on the day of fulfillment of the monetary obligation or its corresponding part, unless a different amount of interest is established by the rent agreement.

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