United States District Court, D. Minnesota
MARLENE H. BIXBY, MARTHA ROGERS, WILLIAM NICKLES, and ELEANOR NICKLES, Plaintiffs,
LIFESPACE COMMUNITIES, INC., d/b/a Friendship Village of Bloomington, Defendant.
P. Sheu, BEST & FLANAGAN LLP, for Plaintiff Marlene
G. Chandler, BRIGGS & MORGAN, P.A., for Plaintiff Martha
E. Fearon, GRAY PLANT MOOTY, for Plaintiffs William and
F. DeVincke, MALKERSON GUNN MARTIN LLP, for defendant.
ORDER GRANTING PLAINTIFFS' MOTION FOR PRELIMINARY
R. TUNHEIM CHIEF JUDGE
Marlene Bixby, Martha Rogers, and William and Eleanor Nickles
(collectively, "Plaintiffs") seek to enjoin a
redevelopment that would demolish the townhomes in which they
live. Defendant Lifespace Communities, Inc.
("Lifespace"), owns and operates Friendship Village
of Bloomington (the "Village"), the residential-
retirement development in which Plaintiffs live. Lifespace
plans to redevelop the Village, and the approved
redevelopment plans require demolishing Plaintiffs'
negotiated with Lifespace to live in their respective
townhomes for life. Now, Plaintiffs seek to enjoin Lifespace
from terminating its contracts with them, from demolishing or
destroying their townhomes, and from taking steps toward any
redevelopment affecting their homes, including selling
interest in the planned redevelopment by collecting deposits
on the new units. Because the Court will find that Plaintiffs
are likely to prevail on the merits of their claims and will
suffer irreparable harm absent a preliminary injunction, the
Court will grant Plaintiffs' Motion for Preliminary
Injunction and enjoin Lifespace.
is an Iowa non-profit corporation with its principal place of
business in Iowa. (Compl. ¶ 4, Mar. 23, 2018, Docket No.
1.) Lifespace was the Village's developer and continues
to own and operate the Village. (Id.)
Bixby is an 81-year-old Minnesota resident. (Id.
¶ 1.) She lives at 8168 Parkview Lane, Bloomington,
Minnesota (the "Bixby Property"), which is a
townhome in the Village. (Id.) Bixby and her late
husband entered into a Residency Agreement with Lifespace in
2012. (Id. ¶ 11.) They paid Lifespace an
entrance fee of $652, 392 and an initial monthly fee of $4,
148. (Id. ¶ 16.) The Residency Agreement gave
them the right to occupy the Bixby Property for their
lifetimes, subject only to limited exceptions. (Id.
¶ 11.) The property is and has been Bixby's
homestead since 2012. (Id.)
Rogers is an 83-year-old Minnesota resident. (Id.
¶ 2.) She lives at 8174 Parkview Lane, Bloomington,
Minnesota (the "Rogers Property"), a townhome in
the Village. (Id.) Rogers and her late husband
entered into a similar Residency Agreement with Lifespace in
1998. (Id. ¶ 12.) They paid Lifespace an
entrance fee of $375, 000 and an initial monthly fee of $ 1,
344. (Id. ¶ 17.) The Residency Agreement gave
them the right to occupy the Rogers Property for their
lifetimes, subject only to limited exceptions. (Id.
¶ 12.) The property is and has been Rogers's
homestead since 1998. (Id.)
Nickles is 87 years old, and Eleanor Nickles is 81 years old.
(Id. ¶ 3.) The Nickels are married Minnesota
residents and live at 8176 Parkview Lane, Bloomington,
Minnesota (the "Nickles Property"), a townhome in
the Village. (Id.) The Nickles entered into a
Residency Agreement with Lifespace in 2002. (Id.
¶ 13.) They paid an entrance fee of $394, 000 and an
initial monthly fee of $2, 693. (Id. ¶ 18.) The
Residency Agreement gave them the right to occupy the Nickles
Property for their lifetimes, subject only to limited
exceptions. (Id. ¶ 13.) The property is and has
been the Nickels' homestead since 2002. (Id.)
The Residency Agreements
Residency Agreements between Plaintiffs and Lifespace are
titled "Return-of-Capital" agreements. (Decl. of
Marlene H. Bixby ("Bixby Dec!.") ¶ 3, Ex. 1
(Bixby Return-of-Capital Agreement ("BA")), Mar.
26, 2018, Docket No. 8; Decl. of Martha Rogers ("Rogers
Decl") ¶ 3, Ex. A (Rogers Return-of-Capital
Agreement ("RA")), Mar. 26, 2018, Docket No. 9;
Decl. of Eleanor Nickles ("Nickles Decl") ¶ 5,
Ex. A (Nickles Return-of-Capital Agreement ("NA")),
Mar. 26, 2018, Docket No. 10.) The Residency Agreements refer
to the Plaintiffs as "Residents" and to Lifespace
as the "Sponsor." (BA at 6; RA at 2; NA at 6.) Each
Residency Agreement requires the Sponsor "to make
available to Resident, for as long as Resident lives and
subject to the terms of this Agreement, a living unit in the
Village described as follows: [description of each Plaintiffs
townhome], and to provide, for the Resident's lifetime,
the services, utilities and furnishings described . . .
below." (BA at 6; RA at 2; NA at 6)
The Residency Agreements lay out various costs, including an
"entrance fee," paid by Plaintiffs "[i]n order
to reside at the Village for life and to receive the services
described above." (BA at 7; RA at 3; NA at 7.) The
entrance fees were determined by the location and type of
unit selected by each Plaintiff. (Compl. ¶ 19.)
Plaintiffs' townhomes are standalone buildings comprised
of two units with an attached two-car garage, two bedrooms, a
large sunporch, and a walk-out to a grassy space and pond.
(Id.) Each unit has more than 1, 640 square feet of
living space. (Id.) The Residency Agreements also
set forth monthly fees to be paid by each Plaintiff and note
that the fee may be increased "if [Lifespace], in its
sole discretion, deems it necessary to meet the financial
needs of the Village and to provide the services to the
residents." (BA at 8; RA 3; NA at 8.)
Nature of the Rights
Residency Agreements state that "Resident may reside in
the Living Unit for as long as Resident is capable of meeting
the requirements of living unit occupancy or this Agreement
is terminated by Resident or [Lifespace]." (BA at 8; NA
at 9; see also RA at 3 (using similar language).)
However, "Resident is not given exclusive possession of
the Living Unit in the Village as against [Lifespace]"
and each Residency Agreement "is not a lease or easement
and does not transfer or grant to Resident any interest in
real property owned by [Lifespace]." (BA at 8; RA at 3;
NA at 9) The Bixby and Nickles Agreements also require the
Residents "to make application for and receive homestead
classification for the Living Unit." (BA at 8; NA at 9.)
Residency Agreements can be terminated by Residents after
they move in for any reason with 120 days' written
notice. (BA at 13; RA at 5; NA at 14.) Lifespace may only
terminate the Residency Agreements "for just
cause," which is defined differently in each Residency
Agreement but generally includes failure to pay associated
fees, concerns regarding Resident's physical or mental
health, disturbance, or violation of operating procedures.
(BA at 14-15; RA at 5-6; NA at 14-15.) ...