Mortgagee sale leaves elderly homeless

Photo: JOHN KIRK-ANDERSON

Shocked Christchurch seniors have been told to vacate their retirement village units because the owner has failed to meet mortgage payments. Gary Campbell is the owner of the retirement villages.

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Shocked Christchurch seniors have been told to vacate their retirement village units because the owner has failed to meet mortgage payments.

The eight residents, most in their 70s and 80s, of Crossdale Courts in Curletts Road, Riccarton, thought they were secure for the rest of their lives but now face an uncertain future as a legal fight begins. The wrangle over the one-bedroomed units, which fall outside the Retirement Villages Act passed last year, again raises issues about the security of many retirement village residents, especially as a tighter economy starts to squeeze heavily mortgaged property owners.

Resident Pat Brown, who has had his unit for five years, said the situation was a "sad scenario which came out of the blue".

"I thought I had a roof over my head for the rest of my life.

"I thought I was secure, but this is very worrying for all of us. It's never far from my mind.

"This is a pretty good little community, but some are not in the best of health and this is worrying the bloody tripe out of them," he said.

"They are not sleeping at night. People are just devastated. You just can't do this to old people," said another resident, who did not want to be named.

The letter from the mortgage company telling the bad news was personally delivered two weeks ago, with residents being told they must vacate within three weeks.

The residents have paid between $40,000 and $60,000 for the right to occupy the units for as long as they remain independent. Under the contracts, the payments were a loan to the owner which the owner had to repay minus 5 per cent when they vacated. They also pay a monthly service fee between $140 and $180.

Now the residents face losing their initial outlay as well as their occupancy rights. "But we are not moving. Nobody crosses the door," Brown said.

Age Concern Canterbury chief executive Andrew Dickerson said he was extremely concerned for the residents.

"I haven't heard of a case as bad as this and I hope it's not the start of things to come. It shows that people thinking about entering these contracts need to seek specialist legal advice," he said.

The units are owned by Crossdale Properties Limited, a company belonging to former police detective sergeant Gary Campbell, who bought the units, a former motel, while still in the police force. Crossdale mortgaged the eight units in 2006 to Cashmere Capital Limited, which advanced $1.1 million over the property. The titles to the units are also subject to a further four or five other mortgages or encumbrances.

Crossdale owns another 15 units in the complex but they are not subject to the Cashmere Capital mortgage.

The company failed to make repayments in September last year, despite efforts by Campbell to refinance and, through Campbell, has also borrowed from the residents outside the occupancy contracts and these monies are also overdue.

The lawyer for Cashmere Capital, Ernie Tait, said he had to be careful what he said because the matter was likely to end in court. His clients had given Campbell at least two months to meet his mortgage obligations and had been led to believe the residents were tenants paying a weekly rent.

"Cashmere Capital is just acting under its rights as mortgagee. Unfortunately, the residents have been caught in the middle because of an agreement they had with Mr Campbell which is not noted on the title."

The units would be auctioned, he said.

The residents are represented by lawyer Leo Steele but he declined to comment.

Initially, Campbell said he would meet The Press but then changed his mind, saying his solicitor had told him not to comment. He spent yesterday with his lawyer, Grant Cameron, who is trying to arrange a refinancing package.

Campbell lives in a plush Fendalton mansion, which is subject to two mortgages and two caveats, and drives a near-new Mercedes 4WD. His company, Abbotsleigh Retirement Home Limited, also owns a resthome in Invercargill. It is also heavily mortgaged.

A spokeswoman for Senior Citizens Minister Ruth Dyson said MP Jim Anderton's office was trying to arrange a meeting.

- © Fairfax NZ News