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2012
THE LEGISLATIVE
ASSEMBLY FOR THE
AUSTRALIAN CAPITAL TERRITORY
RETIREMENT VILLAGES BILL
2012
EXPLANATORY
STATEMENT
Presented by
Mary Porter
MLA
RETIREMENT VILLAGES BILL 2012
Overview of the Bill
Retirement villages are
complexes, or parts of complexes, comprising residential premises (other than
residential aged care facilities covered by the Commonwealth Aged Care Act
1997) predominantly or exclusively occupied by retired persons.
This
Bill introduces legislative provisions into ACT law that regulate existing,
proposed and future retirement villages in the ACT. These provisions replace
the current regulatory scheme and are based on provisions in the NSW
Retirement Villages Act 1999.
Retirement villages in the ACT
operate under one of three main forms-
- Loan-licence agreements:
These agreements typically involve the payment of an ingoing contribution (or
‘loan’) by a resident for the right to live in the premises on a
long-term (or permanent) basis. The resident is typically entitled to a refund
of the ingoing contribution minus exit fees payable on vacation of the premises.
Some agreements also provide for a proportional share of the capital gain of the
unit. These are the most common types of agreements used by the retirement
village industry.
- Unit titled retirement villages: In unit
titled retirement villages, residents own their unit. Residents are bound by
the same requirements under the Unit Titles (Management) Act 2011 as
other unit owners in terms of ownership and maintenance of common property and
must comply with the rules of the owners corporation (also referred to as
‘articles’).
This Bill provides clear guidance to
residents in unit titled retirement villages as to how the provisions of the
Bill apply to their circumstances (for instance, the Bill provides that the
requirement to have village rules does not apply to unit titled retirement
villages, which have owners corporation rules in place).
- Other
agreements: Some residents obtain their right to live in a retirement
village under a residential tenancy agreement (under the Residential
Tenancies Act 1997) on a short term or long term basis. Some not-for-profit
organisations that operate retirement villages often offer low-cost rental
options for some residents.
This Bill provides for residential
tenancies agreements in retirement villages and for retirement villages that
offer a blend of accommodation options for residents (such as loan-licence
agreements for some residents and long-term residential tenancies agreements for
others).
Retirement villages are currently regulated by a mandatory Code
of Practice (the Retirement Villages Industry Code of Practice)
(“the Code”) under the Fair Trading (Australian Consumer Law) Act
1992. The Code is similar in form and substance to the NSW Retirement
Villages Industry Code of Practice which was prescribed by a regulation (now
repealed) made under the NSW fair trading legislation.
The Code sets out
basic higher-level principles about:
- basic resident
rights;
- disclosure requirements in advertising and sales promotion;
- the content of the village contract;
- a framework for dispute
resolution; and
- the establishment of a Code Administration
Committee.
In replacing the Code, this Bill builds on many of the basic
higher-level principles in the Code – introducing greater clarity in
relation to how those principles operate in practice.
This overview
sets out where the Bill adds to existing requirements or where the Bill
introduces new requirements. The substantive changes to the current scheme are
summarised broadly as follows:
Residents’ rights
Both
the Code and the Bill protect basic rights of residents in retirement villages.
These rights include the right to privacy, freedom of association, resident
input into the setting of budgets, the requirement for operators to exercise
sound management and certain resident rights that must be provided for in the
village contract.
Cooling off period
The Code currently
requires that residence contracts (hereafter referred to as “village
contracts”) include a cooling-off period of 5 days.
This Bill
increases the period to 7 days.
Content of village
contracts
Both the Code and this Bill require that the village
contract comprehensively details the terms of the village contract.
The
Bill introduces a new provision which allows standard-form contracts to be
prescribed.
Settling-in period
The Code does not currently
provide for a settling-in period.
This Bill introduces a new provision
which allows new residents to permanently vacate their premises within 90 days
of moving in without incurring liability for payment of departure fees. If a
resident permanently vacates their premises within 90 days of moving in they are
liable to pay to the village operator fair market rent for the period of their
occupancy and a reasonable administrative fee (up to a maximum of $200).
Under the Bill, the timing for payment of the refund depends upon the
type of village contract in place. Where the resident does not have a registered
interest in the premises, for example where they occupied the premises under a
loan or licence arrangement, they will be entitled to a refund of their ingoing
contribution within 14 days after termination of the village contract. Where the
resident purchased a registered interest in the premises, the resident is
entitled to a refund of the purchase price once the unit is re-sold or
re-occupied by another resident.
Safety and Emergency
Procedures
Under this Bill and the Code, village operators have a
duty of care in relation to village residents.
This Bill also requires
all operators to prepare written safety and emergency procedures and to take
reasonable steps to ensure that residents and staff are familiar with such
procedures. Operators are also required to conduct a safety inspection at
least once each year and report back to residents on the findings of these
inspections.
Selling capital items to residents
This Bill
prohibits village operators from selling capital items to residents or
attempting to pass on responsibility to individual residents for the maintenance
and replacement of capital items in their premises. Residents who have
previously bought capital items in their premises from the operator or had
agreed to be responsible for these items can notify the operator and pass
responsibility back. This should be done as soon as possible.
NOTE: This
does not apply to premises owned by a resident in a unit title, community or
company title scheme.
Liability for payment of recurrent charges after
vacating
The Bill provides that for residents who do not own their
units, the maximum period of time a former resident or their estate can remain
liable to pay recurrent charges after he or she vacates or passes away has
been reduced from 6 months to 6 weeks.
For residents who are owners,
after 6 weeks the recurrent charges must be shared between the outgoing resident
and the operator in the same proportion as they are to share any capital gains
under the
contract.
Protecting
refund entitlements
The Bill provides that (other than where a
resident is a registered interest holder) a statutory charge is created over the
retirement village land. The charge secures the entitlement of a refund of
residents’ ingoing contributions. The charge will be given priority over
certain other creditors in the event that a village needs to be sold due to the
insolvency of the
operator.
Investigation
and enforcement powers
The Bill provides that the Director-General
has the power to issue a public warning notice involving a particular
operator.
Access to dispute resolution through ACAT
The
Code currently provides for internal dispute resolution through dispute
resolution committees within retirement villages. There is also a Code
Administration Committee established under the Code to discuss and resolve
systemic issues in retirement villages.
This Bill allows access to the
ACAT by residents and operators for the resolution of disputes that may not be
resolved through internal dispute resolution processes.
Maintenance,
repair and replacement of capital items
The Code requires operators
to manage the retirement village in a sound manner. This Bill builds on this
principle by providing detailed rules about the repair, maintenance and
replacement of capital items in the retirement village.
Duty to
maintain maintain/repair/replace
The Bill makes it clear which
capital items are the responsibility of the village operator and which capital
items are the responsibility of the resident.
The Bill provides that
residents may be asked to contribute to the cost of replacement or repair if
they damaged the item. Residents do not have to contribute for fair wear
and tear of the item.
The Bill also requires that an operator directly
meets the cost of replacement. Recurrent charges must not be used to pay
for improvements to capital items or to repeatedly repair an item that it would
be more cost effective to replace.
Budgeting for maintenance and
repairs of capital items
The Bill requires that a capital works fund
must be set up if any recurrent charges are going to be set aside for longer
term maintenance. The costs of capital maintenance can be paid from the
recurrent charges or from the village’s capital works fund, if it has one.
If an operator intends to use recurrent charges or the capital works
fund for capital maintenance, the annual budget must list the proposed items of
work and their expected costs, and include any quotes obtained.
Recurrent
charges and the capital works fund cannot be used to substantially
improve a capital item beyond its original condition or to maintain or repair an
item of capital that it would be more cost effective to
replace.
Budgeting for replacing fixed capital
items
The Bill requires that the operator is responsible for
arranging and paying for the replacement of capital items which the operator is
responsible for (for example, hot water systems or a dishwasher installed by the
operator) out of its own funds.
Proposed annual budgets cannot include
an allowance for replacing such items, either directly or through depreciation.
The only exception is where an operator did not charge an ingoing contribution
for residents to gain entry to the village before commencement. In these cases,
the recurrent charges paid by residents can be used to fund the cost of
replacing capital items.
Urgent repairs
The Bill provides
that a resident may arrange for urgent repairs to be done and to be reimbursed
for the reasonable costs. The resident must first notify the operator of the
need for the repair and give the operator a reasonable opportunity to carry out
the work. Any work arranged by a resident must be done by a person with the
proper qualifications for the work, such as a licensed electrician or plumber. A
resident can apply to the ACT Civil and Administrative Tribunal (‘the
ACAT’) for orders if the operator does not reimburse
them.
Disputes about maintenance, repairs or
replacement
The Bill allows a resident who considers that the
operator is not maintaining or replacing items of capital for which it is
responsible when necessary to apply for an order from the ACAT. The ACAT has the
power to order the operator to carry out maintenance or replacement within a
specified time.
Fixtures and Alterations
The Bill provides
a right for a resident to add or remove fixtures or make alterations to the
premises with the consent of the operator, which cannot be unreasonably
refused.
Financial Accounts
The Code provides that
management must ensure that all financial accounts for the retirement village
have been prepared in accordance with recognised accounting standards. The Code
also requires retirement village operators to prepare audited annual
accounts of the village within 4 months of the end of each financial year
against budget.
The Bill prescribes certain information which must
be included in the annual accounts.
The Bill also introduces a
requirement for operators to prepare unaudited quarterly accounts of the
retirement village within 4 weeks of the end of each quarter, which must detail
the income and expenditure of the village for the quarter.
The Bill
requires the format of the accounts to correspond as closely as possible with
the layout of the proposed annual budget. The accounts should only contain
details of the income and expenditure of the village. Details of nursing homes
and hostels should be excluded.
The Bill requires that in general, the
annual accounts of the village must be audited each year. A person
qualified to audit accounts for the purposes of the Corporations Law must audit
the annual accounts.
The Bill provides that an audit is not necessary if
the recurrent charges collected in the village’s financial year total
$50,000 or less and the residents have consented not to have the accounts
audited. Quarterly accounts do not have to be audited.
The
auditor
The Bill provides that if the audit fees are to be paid by
the residents, the consent of residents is required to the appointment of an
auditor in the same way residents must consent to the expenditure of the
auditing fees and the fees must be itemised in the budget. This applies even
where one auditor audits the accounts of a number of villages for the same
operator. Residents’ consent is not needed if the same auditor as for the
previous financial year is reappointed or if the operator chooses to pay the
cost of auditing out of its own funds.
Giving copies of
accounts
The Bill requires copies of the quarterly accounts to be
given to the residents’ committee within 28 days after the end of the
quarter. After the 28 days, a resident may ask the operator for a copy of the
quarterly accounts, and the operator must provide this within 7 days.
Quarterly accounts do not have to be given to the residents committee if
the total recurrent charges collected in the financial year are $50,000 or less
and the residents have consented not to receive quarterly accounts.
The
Bill requires copies of the annual accounts to be given to the residents
committee, as well as any resident who asks for a copy, within 4 months after
the end of the village’s financial year. If there is no residents
committee, a copy of the annual accounts must be displayed on a notice board in
a common area for at least one month and be provided to any resident who
requests a copy.
Surpluses and deficits
The Bill
provides that where there is a surplus, the residents can consent to a proposal
for the expenditure of the whole or part of the surplus, or for the operator to
distribute the whole or part of the surplus to the existing residents in equal
shares. A proposal may be made by the operator or the residents committee (if
any).
The Bill also provides that a deficit may be carried forward to a
subsequent financial year to the extent that the deficit is caused by certain
urgent capital maintenance, or is caused by increases in the cost of utilities
(except telephones), statutory charges including rates and taxes, wages and
salaries increased under an award or industrial agreement, and public liability
and workers compensation insurance.
Resident
input
Both the Code and the Bill make provision for resident input
and residents’ committees in retirement
villages.
Residents’ committees
A residents’
committee is a group of residents, elected by their fellow residents, to
represent their interests and to carry out certain functions. Residents’
committees also provide a channel for communication between the residents and
the operator.
The Bill introduces a requirement that only one
residents’ committee may be established in a retirement village, however
the residents’ committee is able to form sub-committees.
The Bill
also introduces limits on who is entitled to be a committee member, the length
of time that a person can hold the same office in the committee and limits on
the number of proxies any person may hold at a meeting.
The Bill provides
that non-residents such as friends and family of residents, the operator,
employees or agents of the operator, residents of nursing homes, Commonwealth
subsidised hostels and nursing homes, or residents from another village, are not
eligible to be committee members.
The Bill also limits the term a person
can hold the same office, or hold an office performing the same (or
substantially the same) functions, on the residents committee to 3 consecutive
years, unless the village has less than 20 residents or the annual budget of the
village is less than $50,000 (or both). They will still be able to hold
other positions on the committee and be eligible to return to their original
position at a later stage.
The Bill introduces a limitation on proxy
voting, with the maximum number of proxies any person may hold for voting at a
residents committee meeting being limited to 2. Residents will be able to vote
at meetings by written ballot and will be able to submit postal votes on special
resolutions.
Functions of the residents’
committee
The Bill details the functions of residents’
committees. Residents committees have a wide range of functions and rights such
as:
• calling meetings of residents to consider and vote on matters
requiring residents’ consent or which affect the management and operation
of the village;
• reporting to the operator decisions made by residents
on matters requiring residents’ consent;
• applying to the ACAT
on behalf of some or all residents;
• requesting information from the
operator about proposed variations to recurrent charges;
• receiving
certain financial accounts from the operator;
• forming
sub-committees;
• proposing changes to the village rules or the village
services and facilities;
• acting as another contact point for
prospective residents;
• meeting with the operator upon reasonable
request;
• receiving notification from the operator when the retirement
village is recorded by the Registrar-General;
• receiving a copy of the
annual safety inspection report from the operator; and
• making
proposals for the distribution of money in the capital works fund that is not
needed to fund capital maintenance, and the surplus in the annual
accounts.
Annual management meetings and budget
consideration
The Bill extends the current right residents have to be
involved in the preparation of the village budget by requiring operators to
conduct annual management meetings with residents and to answer questions
submitted by residents either before or at the meeting. The Regulation to
the Bill lists matters that must be included on the meeting agenda.
The
Bill provides that other than in prescribed exceptional circumstances, village
operators are required to make good any budget deficit at the end of each
financial year. At the same time, operators have flexibility to vary expenditure
between line items. Residents can be asked to fund a deficit only if it is
caused by increases in certain costs specified in the Regulation. These are:
utilities (except telephones), rates and taxes, award wages and salaries, urgent
maintenance, and public liability and workers compensation insurance.
The
Bill also provides that where the operator and residents do not agree to pass a
budget, the ACAT may approve the deadlocked Budget.
Encouraging
recurrent charge increases to be at or below inflation
The Bill
encourages operators to keep increases in the recurrent charges payable by
residents at or below the rate of inflation. There is no need to gain
resident consent for such increases (the notice period is 14 days).
Closure of retirement villages
Both the Code and this Bill
recognise that in exceptional cases retirement villages may close. Before
closing, the operator needs to secure formal approval to terminate village
contracts.
Under the Code, an operator wishing to close the retirement
village must make an application to the Commissioner for Fair Trading, for
determination by the Contract Referee, for termination of a resident’s
right to occupy the premises. The operator must give 14 days written notice to
the resident before making such an application.
Under the Code an
application for termination can only be made on certain grounds, such as where
the management would, in the special circumstances of the application, suffer
undue hardship if the resident’s right to occupy was not
terminated.
This Bill provides for closure of a retirement village for
the purpose only of a change of use of the land (ie using the land for a purpose
other than as a retirement village). Before the ACAT can terminate any
retirement villages, a village operator must comply with strict procedural steps
set out in the Bill.
Firstly, the Bill requires all residents to be given
at least 12 months written notice of the operator’s intention to apply to
the ACAT to terminate residents’ contracts. The notice must be in a
prescribed
form.
If an
application is made to the ACAT for termination of a village contract, the ACAT
is to be satisfied that the operator has obtained alternative accommodation or
has offered it to all affected residents. Such accommodation must be of
approximately the same standard as residents’ current premises and must
not cost any more for residents to live
there.
If
the ACAT orders the termination of any residents’ contracts it may order
the operator to pay compensation to the affected residents for removalist and
utility expenses. The operator may also be ordered to compensate residents if
their new village will cost them more or if they will lose access to services or
facilities.
Unit titled retirement villages
This Bill
provides guidance to residents in retirement villages who own their units as to
how the requirements in the Bill are to apply to them. The Unit Titles
(Management) Act 2011 provides for the ownership and maintenance of common
property and requires residents to comply with the owner’s
corporation’s rules (also known as ‘articles’).
In a
unit titled retirement village, residents who own a unit pay contributions to
the owners corporation funds for the management and maintenance of the common
property and pay recurrent charges to the village operator.
Recurrent
charges cover services provided by the village operator, such as an emergency
call system, advertising, the village bus and auditing of the village
accounts.
Unit title levies are set by the residents each year at the
annual general meeting of the owners corporation. Recurrent charges, on the
other hand, are set out in the village contract between each resident and the
operator.
Clause Notes
This Bill is based on the NSW Retirement Villages Act 1999.
Wherever applicable, the below clause notes have been copied from the
explanatory notes to the equivalent NSW provisions.
Part 1 Preliminary
Section 1 Name of Act – states that the name of the Act is
the Retirement Villages Act
2012.
Section
2 Commencement – states that the Act commences on a day fixed by the
Minister by written notice. If a date is not fixed, the Act will automatically
commence after 6 months (see Legislation Act 2001, section
79).
Section 3 Dictionary – states that the dictionary at
the end of the Act is part of the Act.
Section 4 Notes –
states that a note included in the Act is explanatory and not part of the
Act.
Section 5 Offences against Act—application of Criminal
Code etc – states that other
legislation applies in relation to
offences against the Act, such as the Criminal Code 2002.
The
definition of ‘retirement village’ is set out in section 10.
Part 2 Objects and Important Concepts
Section 6 Objects of Act – provides for the objects of the
Act.
Section 7 Meaning of operator – sets out the
meaning of “operator” for the purposes of the Act, which
specifically excludes the owners corporation of a unit titled retirement
village, the body corporate of a community title scheme village or a managing
agent.
Section 8 Meaning of residence right –
provides a definition of “residence right” as being the
resident’s right to occupy their premises in the retirement
village.
Section 9 Meaning of sale, sale price etc –
provides that for a company title scheme (as defined in the Dictionary), a
reference to the sale, the contract for sale or the sale price of residential
premises is a reference to the residence right (as defined in section
9).
Section 10 Meaning of retirement village – sets
out the meaning of “retirement village” for the purposes of the
proposed Act. The definition makes it clear that certain premises that would
otherwise fall within the definition of that term are excluded from it (for
example, a building used or intended to be used predominantly for the provision
of residential care, within the meaning of the Commonwealth Aged Care Act
1997).
Section 11 Meaning of ingoing contribution
– sets out the meaning of “ingoing
contribution”.
Section 12 Meaning of registered interest
holder – sets out the meaning of “registered interest
holder” which includes residents whose residence right arises from a
registered long term lease (which is a lease of at least 50 years including any
option to renew or a lease that is for the life of the lessee) with a provision
that entitles the resident to at least 50% of any capital
gain.
Section 13 Meaning of capital gain – provides a
definition of “capital gain”.
Section 14 Meaning of
permanently vacating residence – specifies the circumstances in
which a person is taken to have permanently vacated residential premises in a
retirement village.
Section 15 Consent of residents –
deals with the granting of residents’ consent to a proposed measure or
action. The procedure for obtaining that consent is set out in schedule 1 to
the Bill.
Part 3 Representations and information about retirement villages
Section 16 Offence–advertising or promoting village before
development approval given- prohibits the promotion of a proposed
retirement village, and the sale of occupation rights in it, before any
development consent required for the village has been
obtained.
Section 17 Offence–advertising without approval for
facilities – prohibits any representation by the operator of a
retirement village (or a person intending to carry out development for the
purposes of a retirement village) that a residential care facility (such as a
nursing home) will form part of, or be associated with, the village unless any
necessary authorisation for the facility has been obtained.
Section
18 Exceptions to prohibitions on advertising - provides for exceptions to
proposed sections 16 and 17. It provides that a person is not guilty of an
offence under either of those sections merely because the person carries out
market surveys in relation to the proposed development before the relevant
consent or authorisation is obtained, or because he or she advertises the
relevant development application in accordance with the requirements of the
Planning and Development Act 2007.
The section includes a note
which refers the reader to section 58 of the Criminal Code 2002 in
relation to the defendant’s evidential burden in establishing an exception
or excuse provided for in the law which provides the offence.
Section
19 Offence–representation that complex is retirement village -
prohibits any representation by the operator of a complex containing residential
premises that the complex is a retirement village unless the complex falls
within the definition of “retirement village” in section
10.
Section 20 Offence–giving information inconsistent with
disclosure statement – prohibits information being given to a
prospective resident that is inconsistent with information in the disclosure
statement given the prospective resident.
Section
21 Offence–information about services and facilities – prohibits
an operator from representing that a service or facility is provided or
available at or to a retirement village, or is associated with the village, if
the service or facility is not so provided or available or associated.
A
resident may apply to the ACAT for an order directing the operator to pay
compensation if a service or facility mentioned in the contract is not provided
or made available by the date stated in the contract, or if there is no date in
the contract, within a reasonable time.
Section 22 Offence –
making certain representations in promotional material – prohibits
certain representations being made about the village or the village
contract.
Section 23 General inquiry document – requires the
operator of a retirement village to provide a prospective resident with a
general inquiry document within 14 days of request or expression of interest
which gives a brief explanation of the premises, services and facilities and
complies with any requirement prescribed by regulation.
Section
24 Disclosure statement – requires the operator of a retirement
village to give a prospective resident a disclosure statement within 14 days of
request or expression of interest containing detailed information about the
village. The statement must be in the form, and contain the information,
prescribed by the Act and regulation.
Section 25 Offence–failure
to attach disclosure statement to village contract – makes it an
offence for an operator to enter into a village contract with a prospective
resident and fail to attach a copy of the disclosure statement to the village
contract.
Section 26 Offence–entering into village contract less
than 14 days after giving disclosure statement – makes it an offence
for an operator to enter into a contract with a prospective resident less than
14 days after giving the prospective resident a disclosure statement.
Section 27 Orders for provision of general inquiry document or
disclosure statement – provides that where an operator has failed to
provide a prospective resident with a general inquiry document or disclosure
statement, the prospective resident may apply to the ACAT for an order directing
the operator to provide the general inquiry document or disclosure
statement.
Section 28 Information to be given to prospective
residents - provides that the director-general may approve the form and
content of information that must be given to a prospective resident by
notifiable instrument. It is an offence for an operator to fail to provide a
prospective resident with the approved information with or before the general
inquiry document is provided.
Section 29 Copies of certain documents
to be made available – requires the operator of a retirement village
to have available (or at a place of business in the ACT) copies of various
documents relating to the village. The documents include a site plan for the
village, examples of the village contracts that an incoming resident may be
required to enter into, audited accounts of the village for the previous 3
years, and the village rules. Copies are to be given to prospective residents
on request. Failure to meet these requirements is an offence.
Section
30 Certain documents to be given on request – requires that where a
prospective resident requests a copy of the documents mentioned in section 29,
the operator must provide them within 7 days. Failure to do so is an
offence.
Section 31 Orders for documents – provides that a
prospective resident may apply to ACAT for an order directing the operator to
comply with give copies of the documents if the operator has failed to do
so.
Part 4 Entry into retirement villages
Section 32 Definitions–pt 4 – provides for definitions of
terms used in part 4 of the Act.
Section 33 Offence –
requesting or accepting waiting list fees – makes it an offence for an
operator to request or accept payment of a waiting list fee, except where the
fee is not more than $200 and the operator has a written policy setting out how
the waiting list operates and gives a copy of the policy and a receipt to the
person paying the waiting list fee.
The section includes a note
referring to the reader to section 58 of the Criminal Code 2002 in
relation to the onus of proof for the exception in section
34(2).
Section 34 Repayment of waiting list fees – prospective
resident enters village contract – requires the operator to refund any
waiting fees paid by a resident if the prospective resident enters into a
village contract with the operator, unless the operator deducts the amount from
any ingoing contribution paid by the resident.
Section 35 Repayment of
waiting list fees – prospective resident does not enter village
contract – requires the operator to refund the waiting list fee paid
by a prospective resident who does not later enter into a village contract
within 14 days after receiving a written request from the
person.
Section 36 Orders for repayment of waiting list fees
– provides that a person who paid a waiting list fee can apply to the ACAT
for an order directing the operator to repay the fee, which may additionally
include interest.
Section 37 Offence – requesting or accepting
holding deposit – makes it an offence for an operator to request or
accept payment of a holding deposit for residential premises occupied by a
resident.
Section 38 Offence – failure to keep deposits in
trust – makes it an offence for an operator to fail to give any
holding deposit or deposit under a village contract to a trustee to hold on
trust.
Section 39 Repaying etc holding deposits and ingoing
contributions - requires any holding deposit paid in relation to
residential premises in a retirement village to be held in trust until the
prospective resident concerned enters a residence contract with the operator of
the village (or the operator is notified in writing that he or she does not
intend to enter such a contract or has died).
A deposit paid under a
residence contract is (unless the contract relates to the sale of premises and
provides for the manner in which the deposit is to be held) to be held in trust
until final payment is made under the contract.
Section 40 Orders for
repayment of holding deposits and ingoing contributions – provides
that a person entitled to a refund may apply to the ACAT for an order directing
the operator to repay the amount.
Part 5 Village contracts
Division 5.1
General
Section 41 Resident to enter village contract - prohibits the
operator of a retirement village from allowing a prospective resident of the
village to occupy residential premises in the village before the person enters
into a contract (being a residence contract or a service contract) with the
operator. The prohibition does not apply in respect of a person who occupies the
premises together with a person who has entered into such a contract, or who
enters into a residential tenancy agreement with the operator.
If the
operator contravenes the proposed section, any continuing liability of a former
occupant of the premises to pay recurrent charges or departure fees in respect
of the premises ceases on the date that a person enters into occupation of the
premises, and the operator must make any required refund of the former
occupant’s ingoing contribution (and make any other payment that is
required, under a village contract, to be made to the former occupant) no later
than one month after that date.
Section 42 Retirement village land to
be registered under Land Titles Act – requires an operator to lodge a
notice with the registrar-general that the land consisting of the retirement
village is used as a retirement village. It is an offence to fail to comply
with this requirement.
Notice must be given before entering into any
residence contracts. A new notice must be given if the information in a notice
is no longer accurate.
Section 43 Operator must give copy of
retirement village notice – requires the operator to give a copy of
the notice required to be given to the registrar-general to be given to the
residence committee (if any) and each person with a registered interest in the
land to which the notice relates.
Section 44 Application to remove
retirement village notice from register – provides that a person may
apply to the registrar-general for a notice to be removed. The
registrar-general must remove the notice from the register if satisfied that
there are no residential premises on the land and no amounts outstanding that
are payable under a village contract.
Section 45 Inconsistency between
village contract and disclosure statement - provides that, if any term of a
village contract is inconsistent, to the detriment of the resident, with the
information contained in the disclosure statement provided to the resident
concerned, the contract is to be construed as if it contained the information in
the statement, rather than the inconsistent term (unless the inconsistent term
is a term of a standard contract prescribed by the regulations).
If there
is a dispute as to whether a term is inconsistent, the resident may apply to the
ACAT for an order deciding the dispute.
Section 46 Village contracts
must be in writing – provides that a village contract is not
enforceable by an operator against a resident unless in
writing.
Section 47 Operator must allow time for reading of village
contract – provides that it is an offence for an operator to enter
into a residence contract with a person less than 14 days after providing the
person a copy of the village contract.
Section 48 No restriction on
right to obtain independent advice – makes it an offence for an
operator to restrict a person from obtaining independent advice before entering
a village contract with the operator or to require a resident or prospective
resident to use the services of a legal practitioner or other adviser nominated
by the operator.
An operator who requires a resident or prospective
resident to use the services of a legal practitioner or advisor nominated by the
operator, the operator must also reimburse the resident the costs of those
services. A resident or prospective resident may apply to the ACAT for an order
directing the operator to pay the amount.
Section 49 Amendment or
replacement of village contract – voids any purported variation of a
village contract (and any termination of a village contract and entry into a new
one) unless the resident who is the other party to the contract concerned has
obtained a certificate from a legal practitioner (of the resident’s
choosing) stating that the practitioner has explained the effect of the proposed
variation (or the new contract) to the resident and the resident appeared to
understand the explanation and to consent to the variation or the new contract.
The provision does not apply if the resident concerned requested the variation
or the new contract.
Section 50 Offence – failure to obtain
certificate for amendment or replacement of village contract – makes
it an offence for an operator to purport to amend a village contract or end a
village contract and enter into a new contract with the same party and the
resident has not obtained a certificate.
Section 51 Costs of obtaining
certificate - specifies that the reasonable costs of obtaining the
certificate are payable by the operator of the retirement
village.
Section 52 Costs of preparation of village contracts -
provides that the costs of the preparation of a village contract between the
operator of a retirement village and a resident of the village (except as
provided in the previous section) are to be borne equally by the operator and
the resident. Any registration costs (under the Land Titles Act 1925)
associated with a lease, and any duty payable on the lease, is payable by the
resident.
Section 53 Cooling-off period - allows a resident of a
retirement village to rescind a village contract at any time within the period
of 7 business days after entering it (the cooling-off period) unless, in the
case of a residence contract, the resident has commenced to live in the
residential premises concerned.
Section 54 Rescission of village
contract on grounds relating to disclosure statement - permits a resident of
a retirement village to apply to the ACAT for an order allowing the resident to
rescind any village contract to which the operator of the village and the
resident are parties on the grounds that the disclosure statement was false or
misleading in a material particular or was not provided to the resident in
accordance with the proposed Act. The application may be made at any time within
the period of 3 months after the resident occupies residential premises in the
village.
The ACAT is precluded from making the order sought in certain
circumstances (for example, if it is of the opinion that the resident is in
substantially as good a position as he or she would have been had the operator
complied with the proposed Act in respect of the disclosure
statement).
Section 55 Effect of rescission - provides that a
notice of rescission of a village contract takes effect on service of the
notice, and that a rescinded village contract is taken to be
void.
Section 56 Consequences of resident’s rescission of
service contract - sets out the consequences of rescission of a service
contract. If the service contract only is rescinded (leaving the residence
contract on foot), the parties are to try to renegotiate the service contract.
If they cannot agree, the ACAT may, on application of either party, make an
order setting out the terms of the new contract.
Section
57 Consequences of resident’s rescission of residence contract - sets
out the consequences of rescission of a residence contract. Generally,
rescission of a residence contract operates to rescind the service contract and
any associated village contract. The rescinding party is to be repaid all money
paid by or on behalf of that party under the rescinded contract.
If the
rescinded contract relates to premises that are subject to a community land
scheme, company title scheme or unit titled scheme the rescinding party must
execute any necessary instruments and deliver up any necessary documents to
enable the re-registration of the shares or title in the name of the operator
under the rescinded contract.
Any costs associated with the rescission
are payable by the operator. However, claims for compensation or other
adjustments may be made to the ACAT (if, for example, the rescinding party had
the benefit of possession of the residential premises
concerned).
Section 58 Consequence of resident’s rescission of
other village contract - sets out the consequences of a rescission of a
village contract other than a service contract or a residence contact. The
rescinding party is to be repaid all money paid by or on behalf of that party
under the rescinded contract. Claims for compensation or other adjustments may
be made to the ACAT.
Section 59 Condition report for certain
residential premises - prohibits the operator of a retirement village from
allowing a prospective resident of the village to occupy residential premises in
the village unless the operator prepares, and gives to the prospective resident,
a report relating to the condition of the premises at the commencement of the
prospective resident’s occupation of the premises.
A copy of the
report must be annexed to the first village contract that the prospective
resident enters into with the operator. However, the requirement does not apply
to all residence contracts. (For example, a residence contract under which the
resident will own the premises concerned is excluded from its
operation.)
Section 60 Operator to give residents and prospective
residents copies of village contracts - requires the operator of a
retirement village to ensure that the other party to a village contract has a
copy of the contract signed by the operator. A copy of a village contract signed
by the resident or prospective resident of the village must be given to the
resident or prospective resident if the contract is not entered into at the time
the signed copy is given to the operator.
The proposed section also
requires the operator to lodge for registration any sublease that is to be
registered under the Land Titles Act 1925 within one month after it is
returned to the operator in registrable form. The resident is also to be
provided with a copy of the fully-executed lease within 14 days after the
sublease is returned to the operator after its registration.
It is an
offence to fail to comply with the requirements of this
section.
Section 61 Contractual rights of residents against new
operator - provides that a contract between the operator of a retirement
village and a resident of the village is enforceable against any operator for
the time being of the village, except an operator who is merely a landowner in
the village.
Section 62 New operator to convene meeting of
residents - requires a person who is to become a new operator of a
retirement village (if the person is to manage or control the village) to
convene a meeting of the residents and to report at the meeting on the
person’s financial ability to operate the village and on his or her plans
for its future management and operation. It is an offence to fail to comply
with this requirement.
Section 63 Renovations and alteration of
fixtures or fittings – provides that a resident of a retirement
village may add, remove or alter fixtures and fittings, and make renovations to
residential premises, with the consent of the operator of the retirement
village. The operator must not unreasonably withhold consent. The consent of
the operator is not required in respect of certain alterations or
renovations.
Section 64 Renovations and alteration of fixtures or
fittings–ACAT orders – provides that a resident may apply to the
ACAT for an order allowing the addition, removal or alteration of a stated
fixture or fitting in his or her premises, allowing a stated renovation to his
or her premises or amending a condition to which the operator’s consent is
subject. The ACAT may make an order if the withholding of the operator’s
consent or a condition of the consent was unreasonable.
Section
65 Renovations and alteration of fixtures or fittings – limitation of s 64
and s 65 – provides that sections 64 and 65 are limited insofar as a
resident must obtain necessary consent under territory law or to obtain
development consent under the Planning and Development Act
2007.
Section 66 Prescribed matters in village contracts
– enables regulations to make provision for or with respect to matters
that must be included in, and matters that must be excluded from, contracts
relating to retirement villages.
Section 67 Standard form of village
contract – enables regulations to prescribe a standard form of village
contract.
Section 68 Effect of noncompliance with standard form
contract – provides that a village contract for which a standard form
is prescribed and that is entered into after the day when the form is prescribed
is void to the extent it is not in or to the effect of the standard form
contract.
A standard term not included in a village contract is taken to
include the standard term and an amendment to a standard term has no
effect.
The section also provides that a residence right given to a
person under a village contract is not voided by the section, and that the
parties may contract additional terms provided they are not in contravention
with the Act or another territory law or inconsistent with a prescribed
term.
The ACAT can order that an additional term is void if the ACAT is
satisfied the term is in contravention of the Act or another territory law or
inconsistent with the standard terms.
Section 69 Provision for payment
of ingoing contributions – provides that a village contract that
provides for an ingoing contribution may also provide that the contribution must
be paid by instalments at intervals stated in the contract and for interest
payable on the unpaid amount to be worked out as prescribed by
regulation.
Section 70 Parties to minimise loss from breach of village
contract – provides that the rules of law relating to mitigation of
loss or damage on breach of a contract apply to a breach of a village
contract.
Division 5.2 Settling-in period for residents
Section 71 Meaning of end of the settling-in period–div 5.2
– provides a definition for the term “end of the settling-in
period” for the division.
Section 72 Ending of village contract
during settling-in period – provides that a resident of a retirement
village may terminate a village contract before the end of the settling-in
period.
Section 73 Liability of former occupant if village contract
ended during settling-in period – provides that a resident who
terminates a village contract before the end of the settling-in period is only
required to make certain payments under the contract.
Section
74 Operator to refund certain payments made by resident – provides
that the operator is required to refund certain payments made by the resident
under a village contract that is terminated in accordance with the division, and
in certain cases, the proceeds from the sale of the premises.
Section
75 Time for making of payments – sets out the time within which a
refund must be paid after termination under the division. If the amounts are
not paid within the required time the operator or former occupant may apply to
the ACAT in relation to the refund.
Section 76 Former occupant not
required to pay certain amounts – provides that a resident who has
terminated a village contract under the division is not required to pay certain
fees.
Part 6 General management of retirement
villages
Division 6.1 Village rules
Section 77 Application–div 6.1 – provides that the
division does not apply to residents who own their units. There is a note in
the section informing the reader that the body corporate’s by laws (for a
community title scheme) or the owners corporation’s rules (for a units
plan) apply to residents who own their units.
Section
78 Subject-matter of village rules – provides for the making of
written rules relating to the use, enjoyment, control and management of a
retirement village.
Section 79 Village rules to be consistent with
other laws - provides that a village rule is of no effect to the extent that
it is inconsistent with any law.
Section 80 Model village rules -
permits the regulations to prescribe model village rules that may be adopted in
respect of a retirement village.
Section 81 Operator may make village
rules for new villages - allows an operator of a retirement village to make
village rules for proposed villages and villages that do not have any
residents.
Section 82 Village rules for existing villages - allows
village rules to be made for existing retirement villages that do not have any
rules in the same way that village rules may be amended.
Section
83 Proposed amendment of village rules - provides for the amendment of
village rules (at the instigation of either the operator of the village or the
residents) with the consent, by special resolution, of the
residents.
Section 84 Operator’s objection to proposed amendment
of village rules - allows the operator of a retirement village who objects
to an amendment to the rules proposed by the residents to apply to the ACAT for
an order prohibiting the proposed amendment.
Section
85 Operator’s concern that amendment will impose additional cost
– requires the operator to seek the residents’ consent to an
amendment of the approved annual budget if an amendment to the rules which has
been consented to by the residents increases costs on the operator above that
approved in the budget.
An operator can apply to the ACAT for an order
amending the budget if the residents do not consent.
Section 86 Other
applications to ACAT about village rules - allows the operator or a resident
of a retirement village to apply to the ACAT for an order concerning a village
rule whose validity is in dispute or that the operator or resident considers to
be unjust, unconscionable, harsh or oppressive. The Tribunal is empowered to set
aside the rule, to modify it or to uphold it.
Section 87 Compliance
with village rules - requires the operator and residents of a retirement
village to comply with the village rules.
Section 88 Compliance with
village rules by people other than operator and residents - requires the
operator and residents to use their best endeavours to ensure compliance with
the village rules by certain other persons (such as tenants of the operator or
resident or other persons in the village at the invitation of the operator or
resident).
Division 6.2 Certain obligations of operators
Section 89 Offence–certain people not to be operators -
prohibits any involvement of certain persons (such as a person who is insolvent
under administration within the meaning of the Corporations Law) in the
promotion or sale of residence rights in a retirement village. It also prohibits
their being an operator of a retirement village or being in any way concerned in
the management or control of a retirement village.
Section 90 Operator
to provide secure premises - requires the operator of a retirement village
to ensure that the village is reasonably secure.
Section 91 Operator
to provide safe premises – requires the operator to ensure that the
village generally is reasonably safe.
Section 92 Operator to provide
village emergency system on request - requires the operator of a retirement
village, on the request of the residents, to provide or arrange for a village
emergency system. A resident may apply to the ACAT for an order directing that
the operator provide or arrange for an emergency system.
Section
93 Offence – failure to provide emergency and home care service vehicles
access to retirement village – makes it an offence for a retirement
village to fail to take all reasonable steps to ensure that emergency and home
care service personnel have unimpeded vehicular access to the premises at all
times and that residents, local emergency and home care service agencies are
consulted and kept informed about any arrangements made to secure that
access.
Section 94 Change in services or facilities provided at
village - provides for variations (at the instigation of either the operator
of a retirement village or its residents) in the services or facilities provided
in the village by or on behalf of the operator. The variation may not be made
unless the residents of the village, by special resolution, consent to
it.
Section 95 Operator not to reduce or withdraw certain services and
facilities - prohibits the operator of a retirement village from reducing or
withdrawing a service or facility (despite the consent of the residents) if the
development approval for the village requires that it is to be provided for the
life of the village unless the development consent is amended to allow
it.
Section 96 Consequence of unlawful change in services or
facilities - allows a resident of a retirement village to apply to the ACAT
for various orders if the operator of the village reduces or withdraws a service
or facility from the village (unless agreed to by special resolution of the
residents). The order sought may be, for example, for the reinstatement of the
service or facility or for the payment of compensation.
Section
97 Operator not to require residents to patronise particular businesses -
prohibits the operator of a retirement village from restricting the rights of a
resident of the village to purchase goods and services from a person of the
resident’s own choosing.
Section 98 Operator not to demand power
of attorney - prohibits the operator of a retirement village from requiring
a resident or prospective resident of the village to give the operator, a close
associate of the operator or a person nominated by the operator a power of
attorney in favour of the operator, a close associate or nominated
person.
The proposed section also terminates, on the commencement of the
proposed section, any such power given before the commencement of the proposed
section and voids any such power given after the commencement of the proposed
section. However, the proposed section does not apply if the person who gave the
power is a relative of the operator.
Division 6.3 Certain rights of residents
Section 99 Operator to respect rights of residents - requires the
operator of a retirement village to respect the rights of residents of the
village. In particular, the proposed section prohibits any interference by the
operator with the residents’ peace, comfort, autonomy and self-reliance.
It also obliges the operator to use the operator’s best endeavours to
ensure each resident lives in an environment free from harassment and
intimidation.
A resident can apply to the ACAT for orders relating to a
failure by an operator to meet these requirements.
Section
100 Restriction of operator’s access to residential premises –
makes it an offence for an operator, or person authorised by an operator, to
enter residential premises while a resident has residence rights in the premises
except in certain circumstances.
The operator can apply to the ACAT for
access, and a resident can apply to the ACAT for a contravention of the
provision.
Section 101 Right to appoint agent - provides for the
appointment of a person as the agent of a resident of a retirement village for
the purpose of receiving notices or other documents to be given to the resident
under a village contract or the proposed Act.
Section 102 Residents to
be given access to information about them - requires the operator of a
retirement village to give a resident (on request) access to any information
about the resident that the operator holds, and to give the resident a copy of
the information if the resident requests it.
Section 103 Residents
committees and organisations - provides for the establishment of a Residents
Committee in a retirement village for the purposes of the proposed Act. Other
committees of residents may be established for other purposes.
Section
104 Membership of residents committee – provides that a resident must
not hold the same office, or hold an office performing the same (or
substantially the same) functions, on the Residents Committee for the retirement
village for more than 3 consecutive years except as provided by regulation. The
election of a person to office in contravention of the proposed section is
void.
Section 105 Regulations about residents committee - allows
the regulations to make provision for or with respect to the election, functions
and procedure of Residents Committees and sub-committees. The regulations may
also prescribe model rules that may be adopted by a Residents
Committee.
Section 106 Meetings between residents committee and
operator - requires the operator of a retirement village to meet the
Residents Committee (or a representative of the Committee) of the village on the
reasonable request of the Committee, and vice versa.
Section
107 Operator must hold annual management meeting – provides that the
operator of a retirement village is to hold an annual management meeting within
4 months of the end of a financial year for the retirement
village.
Section 108 Operator must give notice of annual management
meeting – provides that it is an offence for an operator to fail to
give 14 days notice of an annual management meeting of the time and place of the
meeting and the agenda. The notice must also include an invitation to submit
written questions to the operator at least 7 days before the meeting and other
questions at the meeting. Regulation may prescribe matters that must be on the
agenda.
Section 109 Annual management meeting–chair –
requires the operator or representative of operator authorised to answer
questions on the operator’s behalf to chair the annual management
meeting.
Section 110 Questions to be answered at annual management
meeting – provides that the operator, or operator’s
representative, is to respond to requests for information at that meeting or as
soon as practicable afterwards.
Section 111 Villages without residents
committee – requires the operator of a village that has no residents
committee to call a meeting of the residents if requested to do so by residents
from a majority of occupied premises for a complex with fewer than 10 occupied
premises or the greater of 5 residents or 10% of residents (whichever is the
greater) for a village with 10 or more occupied premises.
Section
112 Meetings of residents - makes it clear that the residents of a
retirement village have the right to meet for the purpose of considering and
voting on various matters affecting the village. It is an offence for an
operator to interfere with this right.
Section 113 Attendance at
meetings of residents - limits the attendance of persons other than
residents at meetings of residents of a retirement village. The proposed section
also makes it clear that a resident is not obliged to attend, or to vote at, any
such meeting.
Section 114 Meetings of residents–attendance by
investigator – provides that it is an offence for an operator to
prevent or hinder an investigator attending a meeting where the residents have
consented to the investigator attending a meeting of the
residents.
Section 115 No restrictions on voting - voids any term
of a village contract that purports to bind a resident to a particular system
for the conduct of meetings and voting. It also voids any covenant (or contract
or arrangement) under which a particular vote of a resident (or the
resident’s failure to vote) on any matter relating to the village attracts
a penalty.
Section 116 Proxies - enables a resident of a
retirement village to appoint a person as the proxy of the resident for the
purpose of voting on the resident’s behalf at meetings of the
residents.
Section 117 Certain limitations on proxies - limits the
number of proxies that a person may hold for the purposes of the proposed Act.
It also specifies the way in which a person’s appointment as another
person’s proxy may be revoked, and provides for its termination if it is
not revoked.
Section 118 Effect of certain votes - provides that
any vote or resolution of the residents of a retirement village that purports to
oblige the operator of the village to abandon or amend plans for further
development of the village or to cease to act as the operator of the village is
not binding on the operator.
Section 119 Notice of intention to
vacate - provides that a resident of a retirement village cannot be required
to give more than one month’s notice in writing of an intention to vacate
his or her residential premises in the village.
Division 6.4 Right of certain relatives to become
residents
Section 120 Relative to ask to enter into residence contract -
provides that certain relatives of residents of residential premises in a
retirement village who are living in the premises with the resident at the time
that the resident vacates may ask the operator to enter into a residence
contract in relation to the premises (unless the resident is, or was a
registered interest holder (other than a long-term sublessee) or taken to be a
resident under s 8(2).)
Section 121 Application to ACAT by relative of
resident – provides that if the operator does not enter into a
residence contract with a relative’s request under section 120, the
relative may apply to the ACAT for an order directing the operator to enter into
the contract.
Section 122 Application to ACAT by operator in relation
to possession of premises by relative or resident – provides that the
operator may apply to the ACAT for an order requiring vacant possession if a
residence contract is not entered into under section 120 and the vacant
possession has not been given up to the operator.
Section
123 Application to ACAT by operator in relation to possession of premises by
other person – provides that the operator may apply to the ACAT for an
order requiring vacant possession for a person other than a person in section
120.
Division 6.5 Certain obligations of residents
Section 124 Residents to respect rights of other people - provides
that it is a term of every residence contract that the resident will respect the
rights of other residents of, and other persons in, the village.
Division 6.6 Administrators, receivers and managers
Section 125 Application for order appointing administrator -
allows the director-general to apply to the Supreme Court for an order
appointing a specified person as an administrator of a retirement village. Such
an application may be made only if the Director-General is of the opinion that
the well-being or financial security of the residents of the village concerned
is at risk or the Director-General reasonably believes the operator is wilfully
and repeatedly acting in contravention of an ACAT or court order or the village
is the subject of an order under the section.
Section 126 No
application without consent - provides that an application is not to be made
unless the person the subject of the application consents to the
appointment.
Section 127 Order may exempt administrator from certain
obligations – provides that the order of appointment may exempt the
administrator from complying with stated obligations of the
operator.
Section 128 Effect of appointment - prohibits an
operator of a retirement village from exercising any of the functions of the
operator that the administrator is authorised to exercise while the order
appointing the administrator is in force in respect of the village. The proposed
section also requires a person appointed as the administrator to comply with all
the obligations of an operator of the village in respect of the functions that
the administrator is authorised to exercise (unless the terms of the
administrator’s appointment exempt the administrator from that
requirement).
Section 129 Expenses of administration –
provides that the costs incurred by an administrator are payable from recurrent
charges and any other funds that would be made available to the operator if the
administrator had not been appointed.
The section also provides that the
Territory is not liable for any expenses incurred by the administrator or any
liability of the operator.
Section 130 Administrator may amend village
contract - provides that an administrator appointed under the principal Act
has power, with the consent of the Director-General, to vary the approved annual
budget, recurrent charges payable or the services offered by the village to
assist in finding a new operator for the village and to maintain the financial
viability of the village.
Section 131 Revocation of appointment
– provides that the appointment of an administrator may be revoked or
amended by the Supreme Court.
Section 132 Receivers and managers -
requires any person appointed as a receiver, or a receiver and manager, in
respect of an operator of a retirement village to comply with the
operator’s obligations under the proposed Act as if the person were the
operator (unless the terms of the appointment exempt the person from that
requirement).
The section provides that it does not apply to the extent
that it is inconsistent with the Corporations Act.
Section 133 Protection from liability–administrator, receiver or
receiver and manager – provides that an administrator, receiver or
receiver and manager is not civilly liable in the exercise of a function under
the Act or in the reasonable belief that the conduct was in the exercise of a
function under the Act.
Part 7 Financial management of retirement villages
Division 7.1 Preliminary
Section 134 Financial year of retirement village - requires the operator of a retirement village to determine a financial year for the village.
Division 7.2 Capital maintenance and replacement
Section 135 Meaning of capital item–div 7.2 – sets out the meaning of “capital item” for the division with reference to the capital items that the operator is not responsible for.
Section 136 Meaning of urgent–div 7.2 – defines the term “urgent” for the division in terms of repairs or replacement of capital items.
Section 137 Operators obligations–capital maintenance or replacement – sets out the obligations of the operator of a retirement village with respect to certain capital maintenance and replacement.
Section 138 Residents obligations–capital maintenance or replacement - sets out the obligations of a resident of a retirement village with respect to capital maintenance and replacement including an obligation for a resident of a retirement village to reimburse the operator of the village in respect of any damage (other than fair wear and tear) caused by the resident to an item of capital for which the operator of the retirement village is responsible.
Section 139 Resident may carry out urgent work
- provides that a resident of a retirement village may carry out urgent capital
maintenance or replacement after giving the operator a reasonable opportunity to
carry out the work. The proposed section also provides that the operator is to
reimburse the resident for any reasonable costs incurred in carrying out
any
such work.
Section 140 ACAT may make orders for capital maintenance and replacement - provides that the ACAT may make orders for capital maintenance and replacement in certain circumstances.
Section 141 Funding of certain capital maintenance
and capital replacement - provides for the funding of capital maintenance
and replacement
generally.
Section 142 Capital maintenance to be included in proposed annual budget - requires that where the operator is required to supply residents with a proposed annual budget and the operator proposes to use recurrent charges or any part of the capital works fund for the cost of maintenance, the operator must include in the proposed annual budget each item of capital maintenance proposed to be carried out and the expected cost and any quotes obtained for each item, as well as provision for urgent capital maintenance.
Section 143 Capital works fund - provides for
the establishment of a capital works fund. A capital works fund is to be
established if recurrent charges are to be used for funding
capital
maintenance that will extend beyond the end of a financial
year.
Section 144 Misuse capital works fund amounts – makes it an offence to use a capital works fund for anything other than meeting the cost of capital maintenance or distributing any amounts not required for capital maintenance to residents in equal shares (where consented to by the residents) or for any purpose in the regulation.
The section also provides that where the residents have agreed to a proposal by the residents committee to distribute capital works fund amounts under the section, the operator can apply to the ACAT for an order that the distribution not be made, or an order approving or amending the proposed distribution.
Section 145 Retirement village to be insured – makes it an offence for an operator to fail to insure and keep insured the village.
Section 146 Sale of capital items to residents
– makes it an offence for an operator of a retirement village must not
sell an item of capital for which the operator of the retirement village is
responsible to a resident or prospective resident or enter into any other
contract, arrangement or scheme to pass responsibility (whether directly or
indirectly) for the capital
maintenance or replacement of any such item to
the resident.
Division 7.3 Recurrent charges
Section 147 Operator to pay certain recurrent charges – requires the operator of a retirement village to pay in relation to new residential premises in the village, an amount equal to the recurrent charges for general services payable under the village contract in relation to comparable (or the most nearly comparable) residential premises in the building.
Section 148 Amendment of recurrent charges - allows a service contract to provide for the variation of recurrent charges payable under it. The variation may be according to a fixed formula (such as in proportion to variations in the Consumer Price Index) or otherwise. If the contract does not specify the intervals at which the charges are to be varied, they must not be varied more frequently than once a year.
Section 149 Recurrent charge amended by fixed formula - requires the operator of a retirement village to give at least 14 days’ written notice of a variation in recurrent charges when the variation is made according to a fixed formula.
The section makes it an offence for an operator to increase the recurrent charges otherwise than in accordance with the fixed formula or the section.
Section 150 Recurrent charges amended otherwise
than by a fixed formula–not exceeding variation in CPI – The
proposed section provides that the operator of a retirement village is required
to give at least 14 days written notice to the residents of a retirement village
if the operator proposes to vary the recurrent charges payable by the residents
and the recurrent charges are to be varied otherwise than in accordance with a
fixed formula and the variation does not exceed the variation in the Consumer
Price Index for the period since the
recurrent charges were last varied.
Section 151 Recurrent charges amended otherwise
that by fixed formula–exceeding variation in CPI - requires the
operator of a retirement village to give at least 60 days’ written notice
of a variation in recurrent charges where the contract provides that the
recurrent charges are to be made otherwise than in accordance with a fixed
formula and the increase would be more than the CPI increase. It also allows the
operator to give a subsequent notice providing for a lesser increase (if any) in
the recurrent charges.
Section 152 Amending certain recurrent charges
otherwise than in accordance with Act – makes it an offence for an
operator to increase the recurrent charges under section 150 or 151 and the
increase is greater than any upper limits stated in the contract (if any) or not
in accordance with sections 150 or 151.
Section 153 Residents consent to
amendment - makes it clear that a variation notified under proposed section
106 does not take effect unless the residents consent to it or the ACAT so
orders.
Section 154 ACAT orders–recurrent charges - allows
the operator of a retirement village to apply to the ACAT for an order in
respect of a proposed variation in recurrent charges where resident consent is
required by the Act and where the residents do not consent.
The proposed section specifies the matters to which the ACAT may have regard
when determining such an application (for example, the general market level of
recurrent charges paid at similar retirement villages in the locality of the
retirement village concerned or a similar locality). The ACAT may order that the
variation is to take effect, with or without modification, or that it is not to
take effect.
Section 155 ACAT orders—refund of recurrent charges –
provides that a resident of a retirement village may apply to the ACAT for
an order directing the refund of overpaid recurrent charges.
Section 156
Failure to give receipt for payment of recurrent charges – requires
that a person who receives a payment for recurrent charges must give a receipt
for the payment to the person entitled to it.
Section 157 Reduction of recurrent charges in certain circumstances
– if a retirement village or destroyed or ceases to be usable, the
recurrent charges payable by the resident of the village are reduced
accordingly.
Division 7.4 Proposed and approved annual budgets
Section 158 Meaning of proposed annual budget—div 7.4 - is a
formal provision.
Section 159 Proposed annual budget - provides
that the operator of a retirement village must supply the residents of the
retirement village with a proposed annual budget at least 60 days before the
commencement of the financial year to which the budget
relates.
Section 160 Residents may consent to not receiving proposed
annual budget – provides that residents may consent to not being given
a proposed budget in certain circumstances, namely that if the total of the
recurrent charges collected by the operator of the village is less than $50,000
(or other prescribed amount) and the residents of the village consent to not not
getting a budget.
Section 161 ACAT order—proposed annual budget
– provides that a resident of the village may apply to the ACAT
for an order directing the operator to give the budget (where in breach of
s159).
Section 162 Residents consent to spending – provides
that the operator of a retirement village must have the residents‟ consent
for the spending stated in the proposed annual budget for the
village.
Section 163 ACAT orders—decisions about spending
– in the event of deadlock between residents and the operator, ACAT
may make an order in relation to the spending proposed for the financial
year.
Section 164 Proposed annual budget may provide for contingencies
– provides that a regulation may limit the amount a proposed annual
budget may allocate for contingencies.
Section 165 Spending to be in
accordance with approved annual budget – provides when is taken a
budget is taken to be the approved annual budget.
Section 166 Spending
otherwise than in accordance with approved annual budget – provides
offences for spending not in accordance with the approved annual budget. A
defence is provided where the contravention was a variation between items in the
approved annual budget and does not cause a reduction in the level of services
provided by the village or cause the total expenditure to exceed the amount
provided for by the approved annual budget.
Section 167 Amendment of
approved annual budget – permits the amendment of an approved annual
budget.
Division 7.5 Annual accounts
Section 168 Auditing of Accounts - requires the operator of a
retirement village to ensure that the accounts for the village are audited
annually by a person qualified to audit accounts for the purposes of the
Corporations Law. If the audit fees are to be paid by the residents of the
village, the fees must be itemised in the statement of proposed expenditure, the
name of the auditor to be appointed must also be itemised, and the
residents’ consent to that appointment must be obtained.
It also
requires the operator of a retirement village to ensure that village
quarterly accounts (which need not be audited) are provided to
residents.
Section 169 Copies of annual accounts to be given to
residents – requires copies of annual accounts to be given to
residents. It details the matters to be included within the
accounts.
Section 170 Accounts need not be audited in certain
circumstances – provides that the annual accounts of a retirement
village are not required to be audited if the total of the recurrent charges
collected by the operator of the village is less than $50,000 (or other
prescribed amount) and the residents of the village consent to not have the
accounts audited.
Section 171 Quarterly accounts need not be given to
residents in certain circumstances - provides that the operator of a
retirement village is not required to provide the residents of the village with
a copy of the quarterly accounts for the village if the total of the recurrent
charges collected by the operator of the village is less than $50,000 (or other
prescribed amount) and the residents of the village consent to not receive a
copy.
Division 7.6 Surplus or deficit of
accounts
Section 172 Meaning of surplus—div 7.6 – is a formal
provision.
Section 173 Any surplus to be carried over - provides that
any surplus in the annual accounts of a retirement village is to be carried
forward into the next financial year unless the
residents of the village
consent to a proposal for the expenditure of the surplus or consent to a
proposal that the whole or part of the surplus be distributed to the residents
of the village. The proposed section also provides that the Tribunal may order
that the surplus is not to be distributed to the residents.
Section
174 Making good of deficit - provides that the operator of a retirement
village is to make good any deficit in the annual accounts of the retirement
village and prevents the
operator from requiring the residents to contribute
to the making good of any such deficit except as provided by the
regulations.
Part 8 Disputes
Division 8.1
Preliminary
Section 175 Preliminary - provides that the proposed Part has
effect despite anything in the proposed Act or in any other law.
Division 8.2 Dispute resolution
Section 176 Disputes between operator and resident – allows the
operator of a retirement village or a resident of the village to apply to the
ACAT for an order in respect of any dispute between the operator and the
resident.
Section 177 ACAT jurisdiction – allows a resident
of a retirement village to apply to the ACAT for an order in relation to any
village contract to which the resident is a party if the resident considers the
contract to be harsh, oppressive, unconscionable or unjust.
The proposed
section also confers on the ACAT the same jurisdiction as the Supreme Court has
in proceedings in which relief is sought in relation to a contract between an
operator of a retirement village and a resident of the village.
This
section does not affect the jurisdiction of the Supreme Court in relation to
contracts between operators and residents of retirement
villages.
Section 178 Informal resolution of disputes –
makes it clear that the operator and residents of a retirement village may
establish other mechanisms for the purpose of attempting, informally, to resolve
disputes in the village. However, the proposed section voids any term of a
village contract that provides that the parties to the contract must attempt to
resolve disputes between them by any process other than the process provided for
under the proposed Act.
Division 8.3 The ACAT
Section 179 Jurisdiction – empowers the ACAT to exercise the
jurisdiction conferred on it by the proposed Act.
Section 180 No
monetary limit on jurisdiction of ACAT – makes it clear that the ACAT
is not limited in the amount of money it may order to be paid under the proposed
Act.
Section 181 ACAT orders – empowers the ACAT to
make various orders on application by the operator of a retirement village or a
resident of the village (for example, an order that requires the operator or
resident to comply with a requirement of the proposed Act or the regulations, an
order for compensation, an order that restrains any action in breach of a
contract or the village rules).
Part 9 Ending residence contracts
Division
9.1 General principles about ending residence contracts
Section 182 How and when residence right or contract ends – sets
out the circumstances in which, and the time when, a residence right or a
residence contract in a retirement village ends.
The residence right of a
resident who owns his or her residential premises ends only on the completion of
the sale of the premises.
A residence right arising from a contract that
is the form of assignable sublease ends when the sublease is assigned.
A
residence contract relating to any other residential premises in the village
(and the residence right under that contract) ends on disclaimer, on the death
of the resident, on frustration of the contract, if the resident abandons the
premises or delivers up vacant possession to the operator in various
circumstances or if the ACAT ends the contract.
Section 183 ACAT
cannot end certain residence contracts – makes it clear that the ACAT
does not have jurisdiction under the proposed Act to end a residence contract
relating to residential premises that are owned by the resident or to decide
any question as to the title to land.
Section 184 Notice of intention
to seek ending of contract – requires the operator of a retirement
village or a resident who intends applying to the ACAT for an order ending a
residence contract to give written notice of that intention to the other party
to the contract. The ACAT must not make an order ending the contract unless
satisfied that notice has been given.
Section 185 Ending of residence
contract if premises uninhabitable etc – provides for the ending of a
residence contract on frustration of the contract (for example, if the
residential premises the subject of the contract are rendered wholly or partly
uninhabitable otherwise than as a result of a breach of a village
contract).
Section 186 Ending of residence contract if premises
uninhabitable etc – application to ACAT – provides that a party
to a residence contract for residential premises in a retirement village who
receives a termination notice and thinks the premises are not in the condition
stated in the notice may apply to the ACAT for an order about the condition of
the premises. Clause 186 (3) sets out what the ACAT must do on receiving an
application.
Division 9.2 Ending by ACAT on application of
either operator or resident
The proposed Division empowers the ACAT to make orders, on the
application of either the operator or a resident of a retirement village, and on
various grounds, ending residence contracts relating to the village. In making
such an order, the ACAT must fix a date by which the resident concerned must
vacate the residential premises.
Section 187 Ending on medical grounds
– provides for ending of a residence contract on the grounds that the
residential premises occupied by the resident are unsuitable for occupation by
the resident because of the resident’s physical or mental
incapacity.
Section 188 Ending of residence contract on grounds of
breach of village contract or rules – provides for the ending of a
residence contract on the grounds that the operator or the resident breached his
or her village contract or a village rule in such a way (for example, so
seriously or so persistently) as to justify the ending of the contract. Either
party may apply to the ACAT for, and the ACAT may make, an order ending the
contract.
Division 9.3 Ending by ACAT on application of
operator
The proposed Division deals with the ending of residence contracts by the
ACAT on the application of the operator of a retirement village. In making such
an order, the ACAT must fix a date by which the resident concerned must vacate
the residential premises.
Section 189 Ending on grounds of
resident’s causing serious damage or injury – provides for the
ending of a residence contract on the grounds that the resident intentionally or
recklessly caused or permitted (or is likely intentionally or recklessly to
cause or permit) serious damage to any part of the village or injury to the
operator or an employee of the operator or any other resident.
Section
190 Ending on grounds of upgrade or change of use – provides for the
ACAT to make an order the ending of a residence contract on the grounds that the
operator requires vacant possession of the residential premises concerned to
carry out out substantial works to improve the village, or because the land on
which the village is situated is to be used for another purpose.
Division 9.4 Ending by Supreme Court on application of administrator
Section 191 Ending on grounds of retirement village ceasing to operate
– provides that the administrator of a retirement village may apply to
the Supreme Court for an order ending village contracts in relation to the
retirement village if there is no reasonable prospect of finding a new operator
for the village.
Division 9.5 Suspension or refusal of orders for
ending
Section 192 ACAT may suspend or refuse order for ending contract
– enables the ACAT to suspend the operation of an order setting a day
by when a resident whose residence contract is ended must vacate the residential
premises if it is satisfied that it is desirable to do so, after considering the
relative hardship likely to be caused to the resident and other residents of the
village. The proposed section also sets out the circumstances in which the ACAT
may refuse to make an order terminating a residence contract.
Division 9.6 Recovery of possession of premises
Section 193 Prohibition on certain recovery proceedings in courts
– provides that the operator of a retirement village does not have
standing to commence proceedings in the Supreme Court or the Magistrates Court
to obtain recovery of possession of residential premises in the village (except
as mortgagee of the premises).
Section 194 Person not to recover
possession of premises except by order – prohibits entry to
residential premises in a retirement village for the purpose of recovery of
possession of the premises by a person otherwise than in accordance with the Act
or another Territory law. In a proceeding for an offence against the proposed
section, the court may order compensation to be paid to the person against whom
the offence was committed.
Section 195 Enforcement of orders for
possession – provides for a sheriff’s officer to enforce an
order for possession of residential premises in a retirement village after the
ACAT has issued a warrant authorising the sheriff’s officer to do
so.
Section 196 Liability of resident remaining in possession –
makes a resident who fails to comply with an order of the ACAT setting a
date by which the resident must vacate residential premises in a retirement
village after the end of his or her residence contract liable to pay
compensation to the operator for loss caused by failure to comply with the
order. However, the operator must take all reasonable steps to mitigate the loss
and is not entitled to compensation for any loss that could have been avoided by
the taking of those steps.
Division 9.7 Abandonment of premises
Section 197 Application – div 9.7 – provides that the
proposed division applies only in relation toresidential premises the subject of
a residence contract under which the resident is not entitled to any repayment
of ingoing contribution, or any other payment, on termination of the
contract.
Section 198 Abandoned premises – enables the ACAT
to make an order, on application by the operator of a retirement village,
declaring that residential premises occupied by a resident of the village were
abandoned by the resident on a day stated in the order.
Section
199 Right of operator to compensation where resident abandons premises –
entitles the operator of a retirement village to apply to the ACAT for
compensation from the resident concerned for any loss caused to the operator by
the resident’s abandonment of the residential premises. However, the
operator must take all reasonable steps to mitigate the loss and is not entitled
to compensation for any loss that could have been avoided by the taking of those
steps.
Division 9.8 Uncollected goods
Section 200 Application – div 9.8 – provides that the
proposed Division does not apply in relation to residential premises that are
occupied by a resident who is a registered interest holder in relation to the
premises.
Section 201 Uncollected Goods Act does not apply –
provides that the Uncollected Goods Act 1996 does not apply to goods
left on residential premises in a retirement.
Section
202 Delivery of uncollected goods – enables a former resident of a
retirement village (or any other person having an interest in the goods
concerned) to apply to the ACAT for an order for the delivery of goods left
behind by the resident after the ending of his or her residence
contract.
Section 203 Disposal of uncollected goods –
enables the operator of a retirement village to apply to the ACAT for an
order relating to goods left behind by a former resident of the village whose
residence contract has been ended. Before doing so, however, the operator must
send notice of his or her intention to the former resident if the operator has a
forwarding address for the former resident.
Section 204 Title to sold
goods – provides that a purchaser of goods sold by an operator under
this division acquires a good title to the goods.
Section 205 Sale of
uncollected goods in contravention of this Act – provides that it is
an offence to sell, remove destroy or dispose of goods under section 203 (1)
otherwise than in accordance with this division.
Section
206 Protection from liability – operator – provides that the
operator of a retirement village does not incur any civil liability in relation
to the operator’s dealing with the goods in accordance with this division.
Clause 206 (2) provides that a person who has an interest in the goods may apply
to the ACAT for an order directing the operator to pay compensation to the
applicant.
Part 10 Matters relating to vacation of
premises
Division 10.1 Preliminary
Section 207 Meaning of permanently vacating residence – pt 10
– The proposed section provides that, for this part, a former occupant
who died or vacated residential premises in a retirement village in the
circumstances described in proposed section 120(1)(b) (Relative may ask to enter
into residence contract) is taken to have permanently vacated the premises on
the day the occupant died or vacated the premises.
Section 208 Meaning
of sale of residential premises – pt 10 – The proposed
section provides that a reference to the sale of the residential premises
by a registered long-term sublessee is taken to be a reference to the sale of
the residence right in respect of the premises.
Division 10.2 Recurrent charges
Section 209 Recurrent charges for optional services – provides
that a resident or former occupant of a retirement village who is absent from
the village for a period of 28 consecutive days is not liable to pay recurrent
charges in respect of personal services in respect of the remainder of that
period of absence. If the operator of the village and the resident or former
occupant cannot agree on the apportionment of recurrent charges between personal
services and general services, either of them may apply to the ACAT for an order
making that apportionment.
Section 210 Recurrent charges for general
services – registered interest holders – provides that a
registered interest holder’s liability to pay recurrent charges in respect
of general services arising after the registered interest holder’s
permanently vacates the premises ceases on the earliest of the following dates
(unless the contract between the operator and the resident or former occupant
provides for an earlier cessation of the liability):
(a) the date on which
the operator of the retirement village enters into:
(i) a village contract
with an incoming resident, or
(ii) a residential tenancy agreement with an
incoming tenant, in relation to the premises, or
(b) the date on which a
person takes up residence in the premises with the consent of the operator,
or
(c) if the operator buys the premises from the former occupant—the
date on which contracts for the purchase are exchanged, or
(d) if the former
occupant is a registered long-term sublessee, unless the contract between the
former occupant and the operator provides for an earlier day, the earlier of the
following:
(i) if the ACAT ended the residence contract—the date on
which the former occupant delivered up vacant possession of the premises,
or
(ii) if the former occupant delivered up vacant possession of the premises
to the operator after receiving notice of the operator’s intention to
apply to the ACAT for an order terminating the residence contract—the date
on which the former occupant permanently vacated the premises.
Section
211 Recurrent charges for general services – generally – is a
similar provision relating to non-registered interest holders. The dates for
cessation of liability are the same as in proposed section 210, except that the
paragraph referring to exchange of contracts for the sale of the premises is
omitted and a paragraph referring to the delivery of vacant possession
(otherwise than after termination of the residence contract by the Tribunal or
after receiving notice of the operator’s intention to apply to the
Tribunal for an order terminating the contract) is added. The maximum period of
time for which a non-registered interest holder can be liable for recurrent
charges for general services is 42 days after delivering vacant possession to
the operator.
Section 212 Time of payment of recurrent charges –
provides for the former occupant to elect to pay recurrent charges either
when the liability for them arises or at a later date (or partly as the
liability arises and partly at a later date).
Section 213 Interest on
recurrent charges – provides for interest on recurrent charges arising
after the former occupant vacated the residential premises if payment is not
made when the liability arises. A regulation may prescribe a maximum rate of
interest.
Division 10.3 Departure fees
Section 214 Meaning of departure fee – explains that
a departure fee is any fee calculated in relation to the period (or part of a
period) during which a person has or had a residence right in a retirement
village (and, in certain limited cases, in respect of a period after the
termination of the person’s residence contract), or a fee declared by the
regulations to be a departure fee.
Section 215 Meaning of village
contract – div 10.3 – provides that, for this division,
village contract means a village contract that provides for payment of a
departure fee.
Section 216 Payment of departure fee –
provides that any departure fee is payable to the operator of the retirement
village. It is payable out of the former occupant’s ingoing contribution
unless the former occupant owns or owned his or her premises (in which case, it
is payable out of the proceeds of the sale of the premises).
Section
217 Departure fees payable – provides a departure fee is not payable
to the extent that it is calculated in relation to a period occurring after a
former occupant has permanently vacated the residential premises.
Division 10.4 Repair and refurbishment of residential premises
Section 218 Meaning of refurbishment – div 10.4 –
defines refurbishment of residential premises the subject of a residence
contract as meaning (for the purposes of the Division) any improvement of the
premises in excess of that required to reinstate the premises to the condition
they were in (fair wear and tear excepted) at the commencement of their
occupation by the resident under the contract.
Section 219 Condition
of premises on ending of residence contract – requires a former
occupant (other than a registered interest holder) to leave his or her
residential premises as nearly as possible in the same condition (fair wear and
tear excepted) as the premises were in at the beginning of the residence
contract.
Provision is made for an application to the ACAT for an order
in relation to a dispute between the operator and the former occupant as to
whether the premises have been left in such a condition as to require repairs,
or a dispute about the cost of the repairs, or a dispute about
both.
Section 220 No refurbishment required – makes it clear
that a former occupant who entered into his or her residence contract on or
after the commencement of the proposed section is not liable to refurbish (or
pay for the cost of the refurbishment of) the premises.
Division 10.5 Sale or letting of premises by certain residents
Section 221 Application – div 10.5 – makes it clear
that the proposed Division applies only to residents of retirement villages who
have a registered interest in his or her premises in the
village.
Section 222 Options – requires an operator of a
retirement village who holds an option to purchase any residential premises in
the village from a resident to decide whether or not to exercise the option (and
to give the resident notice of that decision) no later than 28 days after the
resident permanently vacates the premises concerned. If notice is not given, the
option lapses. The provision overrides any term of the option.
Section
223 Sale of premises – allows a resident of a retirement village to
set the sale price for his or her residential premises, and to appoint a selling
agent of the resident’s choice (who may be the operator of the retirement
village). Any appointment of the operator (or a person of the operator’s
choice) as the selling agent, if made as part of the consideration for entry
into the village or otherwise at the operator’s request, is voided. The
proposed section sets out certain obligations of the selling agent (if the agent
is the operator or a person chosen by the operator), and requires the resident
to give the operator details of the selling agent if the resident appoints a
person other than the operator or a person chosen by the
operator.
Section 224 Operator not to interfere in sale –
prohibits the operator of the retirement village from interfering in the
sale.
Section 225 Costs of sale – provides that the operator
and the resident are to share the costs of the sale in the same proportion (if
any) as they are to share any capital gains on the sale. However, if the
resident appointed a person other than the operator or a person of the
operator’s choice as the selling agent, the resident is liable to pay the
selling agent’s commission.
Section 226 Buyer and operator to
enter contract – requires a vendor of residential premises in a
retirement village who is not the operator of the village to give the operator
sufficient notice of the sale to enable the operator to provide the purchaser
with the disclosure statement and other information that the operator is obliged
to provide to a prospective resident. The proposed section also makes a
contract for the sale of residential premises in a retirement village
conditional on the purchaser’s entering into a service contract with the
operator of the village. If the operator decides not to enter such a contract,
the operator must advise the vendor of that decision and of the reasons for it,
and must apply to the ACAT for an order declaring that the operator is not
obliged to enter into the service contract.
Section 227 Seller’s
application to ACAT concerning proposed buyer – provides that, if the
operator does not either enter into the service contract or apply to the ACAT
within 14 days after being notified of exchange of contracts for the sale, the
vendor may apply to the ACAT for an order directing the operator to enter the
contract concerned.
Section 228 ACAT decision in relation to proposed
buyer – provides that the ACAT, on application by the operator or the
vendor in regard to the service contract, must determine whether the
operator’s decision not to enter into such a contract is unreasonable in
the circumstances, having regard to the physical and mental capacity of the
purchaser and any other factor that the ACAT considers relevant. On making that
determination, the ACAT may make an order of the kind referred to in proposed
sections 226 and 227, as appropriate, regardless of whether that was the order
sought.
Section 229 Letting or subletting of premises –
allows a resident to let (or, in the case of a resident who is taken to be a
registered interest holder for the purposes of this section by virtue of
subletting) his or her residential premises in the retirement village under a
residential tenancy agreement to which the Residential Tenancies Act 1997
applies. Any such agreement must not be for a term of more than 3 years and the
tenant or subtenant must be a retired person.
The resident must provide the
operator with written details of the proposed agreement (and the proposed tenant
or subtenant) and must not enter into the agreement unless the operator has
consented in writing to it. The operator may refuse consent to a second or
subsequent agreement if the proposed term, when added to the term of any
preceding such agreement relating to the premises entered into by the same
resident, would exceed 3 years.
If the operator refuses consent in any other
case, the operator must advise the resident of that decision and of the reasons
for it, and must apply to the ACAT for an order declaring that the operator is
not obliged to consent to the agreement. If the operator does not apply for the
order within the time allowed by the proposed section (7 days after receiving
the written details the resident is required to provide), the operator is taken
to have consented to the agreement.
Section 230 ACAT decision in
relation to proposed tenant or subtenant – provides for the ACAT to
determine, on application by the operator in regard to the proposed residential
tenancy agreement, whether the operator’s decision not to consent to the
agreement is unreasonable in the circumstances, having regard to the physical
and mental capacity of the proposed tenant and any other factor that the ACAT
considers relevant.
The ACAT may order the operator to consent to the
agreement, or may declare that the operator is not obliged to consent to it. If
the ACAT orders the operator to consent, the operator is taken to have consented
to the agreement on the making of the order.
Section 231 Effect of
granting of residential tenancy agreement under this division –
provides that services under the service contract between the operator of a
retirement village and the resident are to be provided to a tenant or subtenant
of the resident as if the tenant or subtenant were the resident, and the
contract may be enforced accordingly. It also provides that the letting or
subletting of residential premises in accordance with the proposed Division does
not affect any right or obligation of the resident and the operator under a
village contract.
Section 232 Operator not to interfere in letting
– prohibits the operator of the retirement village from interfering in
the letting of the premises, with the limited exceptions outlined in the
section.
Section 233 No assignment or subletting – prohibits
a tenant or subtenant under the residential tenancy agreement from assigning his
or her interest under the agreement or subletting the premises the subject of
the agreement.
Section 234 Legal ability to sublet –
provides that, for the purposes of the proposed Division (and despite the
termination of the resident’s residence contract), a resident who is a
registered long term sublessee is also taken to possess a legal estate in his or
her residential premises such as to enable the resident to lease the premises
under a residential tenancy agreement.
Division 10.6 Payments to former occupants
Section 235 Payments to former occupants who were registered interest
holders – is concerned with final payments to former occupants who
owned their residential premises in a retirement village.
It requires the
operator of the village to make any payment required to be made to the former
occupant following the sale of the premises within 14 days after the earliest of
the following (unless the contract between the operator and the former occupant
provides for earlier payment):
(a) the date on which the operator receives
full payment under a residence contract with an incoming resident of the
premises,
(b) the date on which the operator enters into a village contract
with an incoming resident of the premises,
(c) the date on which the operator
enters into a residential tenancy agreement with an incoming tenant of the
premises,
(d) the date on which a person takes up residence in the premises
with the consent of the operator,
(e) if the operator buys the premises from
the former occupant—the date on which the operator completes the
purchase.
Section 236 Statements to former occupants who were
registered interest holders – this section applies if the operator
makes a payment to a former occupant under proposed section 235.
At the
same time as the payment is made, the operator is required to give the former
occupant a statement setting out various fees and charges (such as any departure
fee payable, any accrued or outstanding recurrent charges) and the amount of the
payment due to the former occupant. The statement must also show how the various
amounts were calculated.
Section 237 ACAT order – recalculation
of amount under s 235 – this section applies if the operator must make
a payment to a former occupant under section 235. Provision is made for the
former occupant to apply to the ACAT for the appropriate order if the payment is
not made within the time allowed by the proposed section or if the amount of the
payment is not calculated in accordance with the proposed Act and any relevant
village contract.
Section 238 Payments to former occupants who were
not registered interest holders – is concerned with final payments to
former occupants who were not registered interest holders.
It provides that
the date on which the operator of a retirement village must make any refund of
the former occupant’s ingoing contribution that is required, under a
village contract, to be made is the earliest of the following (unless the
operator and the former occupant agree on an earlier date or the contract
provides for earlier payment):
(a) the date that is 14 days after the date on
which the operator receives full payment under the residence contract of an
incoming resident of the premises,
(b) the date that is 14 days after the
date on which the operator enters into a residential tenancy agreement with an
incoming tenant of the premises,
(c) the date that is 14 days after the date
on which a person takes up residence in the premises with the consent of the
operator,
(d) if the Tribunal terminated the residence contract—the
date that is one month after the date of the termination,
(e) if the former
occupant delivered up vacant possession of the premises to the operator after
receiving notice of the operator’s intention to apply to the Tribunal for
an order terminating the residence contract—the date that is one month
after the date on which vacant possession was delivered,
(f) the date that is
6 months after the date on which the former occupant otherwise delivered up
vacant possession of the premises to the operator.
Any other payment that is
required, under a village contract, to be made to the former occupant and that
is dependent on the amount of the ingoing contribution of the incoming resident
is to be paid to the former occupant within 14 days after the earlier of:
(a)
the payment, under a village contract, of any money to the operator, by that
incoming resident, or
(b) the incoming resident’s taking up residence
in the premises.
At the same time as the payment is made, the operator is
required to give the former occupant a statement setting out various fees and
charges (such as any departure fee payable, any accrued or outstanding recurrent
charges) and the amount of the payment due to the former occupant. The statement
must also show how the various amounts were calculated.
Section
239 ACAT order – recalculation of payment under s 238 –
Provision is made for the former occupant to apply to the ACAT for the
appropriate order if the payment is not made within the time allowed by the
proposed section or if the amount of the payment is not calculated in accordance
with the proposed Act and any relevant village contract.
Section
240 Payments to executors and administrators – provides that if a
payment under the proposed Division is required to be made to the executor or
administrator of a former occupant’s estate and the operator of the
retirement village concerned is unable to ascertain the identity of the executor
or administrator, the operator may apply to the ACAT for an order directing the
operator to deal with the money as specified in the order.
Part 11 Protection of ingoing contributions paid by residents other than registered interest holders
Part 11 makes provision for the creation of a statutory charge over land
in a retirement village to ensure that a former occupant of a retirement village
(other than a registered interest holder) receives the amount to which they are
entitled under a village contract on the termination of that
contract.
Section 241 Application–pt 11 - provides that the
proposed Part applies to a village contract that provides for the refund of the
whole or any part of an ingoing contribution paid
by a resident of the
retirement village under a village contract.
The proposed section also
provides that the Part does not apply in respect of a village contract for
residential premises, the occupant of which is a registered interest holder in
respect
of those premises.
Section 242 Creation of charge -
provides that a statutory charge is created over the land
within the
retirement village on the day that a resident enters into a village
contract
to which the Part applies. The proposed section also provides that
the charge is not
created over land that is not registered as part of a
retirement village or which is held
by a resident as a registered interest
holder.
Section 243 Disposal of land subject to charge - provides
that it is an offence for a person to dispose of land that is subject to such a
charge otherwise than in accordance with an order of the Supreme Court. The
proposed section does not prevent the sale of the retirement
village as a
going concern.
Section 244 Effect of charge on successors of title
- provides that a statutory charge is not terminated by the transfer of title in
the land.
Section 245 Application for enforcement of charge -
provides that certain persons may apply for an order of the Supreme Court to
dispose of land that is the subject of a charge if it appears that it is
unlikely that the operator of the retirement village will be able to refund any
part of an ingoing contribution that a resident or former occupant is entitled
to be refunded.
Section 246 Order for enforcement of charge -
provides that the Supreme Court may, on the application for enforcement of a
charge, order that land subject to a charge be sold, order the appointment of a
person to act as an agent for the sale and decide the entitlements of residents
and former residents.
The section also provides that the Court may make
any other orders with respect to the
distribution of the proceeds of the sale
in accordance with the priority of interests prescribed in section 247 and make
any other order it considers appropriate.
Section 247 Priority of
interests - provides the order in which interests in land that is subject to
a charge are to be satisfied from the proceeds of the sale of that
land.
Section 248 Order not to disadvantage residents –
provides that the Supreme Court must not make an order under this part unless
satisfied that it would be in the best interests of the majority of residents to
do so.
Section 249 Removal of charge - provides that a charge
created under the part
remains in force until the village contract that
caused the creation of the charge has
been terminated and all of the
operator’s liabilities under that contract have been met
or the land
has been sold in accordance with an order under the part.
Part 12 Administration
This part deals with administrative functions of the Director-General,
such as the power to issue warning notices, conduct proceedings and intervene.
There is also a section granting the Director-General protection from
liability.
These provisions are modelled on provisions in the NSW
Retirement Villages Act 1999, and have been redrafted as appropriate
consistent with ACT legislative drafting style and practice.
Part 13 Miscellaneous
This part deals with miscellaneous provisions, such as charges, inconsistency
between this Act and the Civil Law (Sale of Residential Property) Act
2003, contracting out of the Act, determination of fees, approved forms and
regulation-making power.
This part also includes a requirement for the
Minister to review the operation of this Act as soon as practicable after the
end of the Act’s 2nd year of operation.
Part 14 Repeal
This part repeals the Fair Trading (Retirement Villages Industry) Code of Practice 1999.
Part 20 Transitional
This part deals with transitional arrangements for existing contracts, as
part of transitioning from the Code of Practice to the new legislation.
This part includes a transitional regulation making power, which permits
the making of a regulation to modify Territory law to make provision in relation
to anything that, in the Executive’s opinion, is not, or is not adequately
or appropriately, deal with in this part.
This part expires 5 years after
commencement date.
Schedule 1 Consent of residents
The schedule includes provisions relating to consent of residents (refer
section 15). The schedule deals with entitlement to vote, when votes are to be
taken, method of voting and special resolutions.
These provisions are
modelled on provisions in the NSW Retirement Villages Act 1999, and have
been redrafted as appropriate consistent with ACT legislative drafting style and
practice.
Dictionary
The dictionary contains definitions for defined terms used in the Act. The Legislation Act contains definitions for terms used more generally in ACT legislation.