The recent July 2014 decision by the NSW Civil & Administrative Tribunal (NCAT) Alloura Waters Retirement Village Residents Committee v Living Choice Australia Pty Ltd  NSWCAT has provided clear and much needed guidance on commonly disputed budget issues and the role of the residents committee in the retirement village sector.
A residents committee made an application to the NCAT Tribunal (the Tribunal) in respect to the following complex matters of fact and law:
- Was the operator obliged to repay or reimburse recurrent charges because some expenditure items were not in accordance with the approved budgets?
- Were certain disputed expenditures properly characterised as "capital maintenance" or "capital replacement" as those terms are defined in the Retirement Villages Act 1999 (NSW) (the RVA)?
- Had the operator obstructed the residents committee in the exercise of its functions?
- Can the residents committee obtain orders under s93 of the RVA to direct an operator to carry out specified works?
In making its findings as to the specific items in dispute, the Tribunal also gave instructive commentary as to its approach to a range of commonly disputed issues in the retirement villages sector.
This commentary is summarised in the following table:
Click here to view table
A budgeting ‘cheat sheet’?
In addition to general findings, the Tribunal quite helpfully set out its findings as to whether a range of common expenditure items are in fact ‘repairs’, ‘maintenance’ or ‘capital replacement’ items. These findings may assist operators in preparing and resolving disputes in relation to budgets.
Operators may wish to review the case in whole here.