Compilation of Rules and Regulations of the State of Georgia › Department 120 - OFFICE OF COMMISSIONER OF INSURANCE, SAFETY FIRE COMMISSIONER AND INDUSTRIAL LOAN COMMISSIONER › Chapter 120-2 - RULES OF COMMISSIONER OF INSURANCE › Subject 120-2-51 - CONTINUING CARE PROVIDERS AND FACILITIES › Rule 120-2-51-.05 - Escrow Account, Escrow Agreement and Certain Minimum Provisions Required

Current through Rules and Regulations filed through June 27, 2024
(1) Any portion of the entrance fee paid by a
				resident or prospective resident to the provider shall be held in an escrow
				account which shall be governed by an escrow agreement, unless the provisions
				set forth in O.C.G.A. Section
				33-45-8 regarding the release of
				escrow funds have been met at the time the entrance fee for a resident owned
				living unit is paid by the resident to the provider. If an escrow agreement is
				required, such agreement shall include in writing at least the following
				minimum provisions:
(a) The purpose of the
				escrow agreement pursuant to O.C.G.A. Section
				33-45-8(a);
(b) Any portion of the entrance fee paid by a
				resident to the provider shall be held in an escrow account governed by the
				escrow agreement;
(c) Definitions
				set forth in O.C.G.A. Section
				33-45-1
et seq.
shall be incorporated into the escrow agreement;
(d) Any portion of the entrance fee paid by a
				resident or prospective resident to the provider is subject to the terms of the
				escrow agreement and shall be deposited by the provider with the bank promptly
				after receipt;
(e) The bank shall
				be appointed as escrow agent;
(f)
				The bank shall hold and distribute all entrance fees deposited with the bank in
				accordance with the escrow agreement;
(g) Any portion of the entrance fee paid by a
				resident or prospective resident to the provider that is held for ninety (90)
				days or more shall earn interest. Such interest shall be credited at least
				quarterly to the resident's account(s) and shall belong to the
				resident;
(h) The bank shall
				disburse funds from the escrow account payable to the resident or prospective
				resident upon the receipt of documentation signed by a representative of the
				provider certifying that such funds may be released in accordance with the
				terms of the escrow agreement and any applicable law or regulations, a copy of
				which shall be attached to the escrow agreement, or upon the bank's
				determination that such funds may be released to the resident in accordance
				with O.C.G.A. Section
				33-45-8. The bank may rely upon
				the total disbursement amount included in such signed documentation from the
				provider and shall have no obligation to verify the accuracy of any such
				documentation. Upon receipt by the bank of such documentation, the bank shall
				disburse funds to the resident or prospective resident within five (5) banking
				business days;
(i) The bank shall
				disburse funds from the escrow account payable to the provider upon the receipt
				of documentation signed by a representative of the provider certifying that
				such funds may be released in accordance with the terms of the escrow agreement
				and any applicable law or regulations, a copy of which shall be attached to the
				escrow agreement. The bank may rely upon the total disbursement amount included
				in such signed documentation from the provider and shall have no obligation to
				verify the accuracy of any such documentation. Upon receipt by the bank of such
				documentation, the bank shall disburse funds to the provider in accordance with
				the provider's instructions within five (5) banking business days;
(j) The bank shall be entitled to rely upon
				the written notices, instructions and directions of the provider and shall have
				no liability for any action taken based upon such reliance;
(k) The bank shall not be liable for the
				following if done in good faith: any errors of judgement, any act committed,
				any step taken or omitted, any mistake of fact or law, or for anything that the
				bank may do or refrain from doing in connection therewith. However, the bank
				shall be liable for its own negligence or willful misconduct;
(l) The bank may consult with legal counsel
				of its own choice should any dispute or question arise pursuant to the escrow
				agreement, or bank's duties thereunder. Should a dispute arise related to the
				proper disbursement of funds by the bank, the bank, upon ten (10) days prior
				notice to the provider, may file a suit in interpleader for the purpose of
				determining the rights of the parties to any funds held in escrow and may
				deposit such funds with the court. The provider shall reimburse the bank for
				its reasonable and legitimate legal expenses so incurred to the extent allowed
				by Georgia law;
(m) The escrow
				agreement may be terminated by either the bank or the provider. Upon
				termination, the bank shall deliver the escrow agreement and all funds held in
				the escrow account(s) (including any income earned thereon) and any and all
				related instruments or documents to a successor escrow agent. Such termination
				shall become effective upon the date such funds and any related instruments or
				documents are delivered to the successor escrow agent. Upon delivery of all
				funds and any related instrument or documents in accordance with this
				paragraph, the bank shall thereafter be discharged from any further obligations
				pursuant to the escrow agreement. All power, authority, duties and obligations
				of the bank shall henceforth apply to the successor escrow agent; and
(n) Contact information, including name and
				address, for the provider, bank and Department for notice, instruction and
				direction purposes.