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Each of the four types of lodge accommodations required
payment of an entry fee and monthly rent in accordance with a
rental contract. Petitioner could revise the monthly rent with a
minimum of 30 days' notice to the lodge residents. Separate
payments were made for the meal service, medical costs, and other
services. The rental contract did not specify the length of the
agreement. The rights to terminate the contract of both
petitioner and the resident were similar to those rights under
the apartment rental contract.
The entry fees and monthly rent (exclusive of meals) for the
lodge units during 1988 were as follows:
Type of Unit Entry fee Monthly Rent
Single Room $25,000 $425
Studio Apartment 26,500 452
Expanded Studio 35,000 632
One Bedroom 52,000 844
Petitioner collected the entire entry fee before the resident
moved into a lodge unit. If the entry fee was received more than
60 days prior to the date of occupancy, the contract called for
petitioner to credit the resident with interest at the rate of 10
percent per annum for the period between the date of deposit and
the date of occupancy.
If the prospective resident terminated the contract prior to
occupancy, petitioner refunded the entry fee plus any interest,
less a discount of 5 percent of the entry fee. If the tenant
terminated the contract or died within the first 20 years of
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