The Parliamentary Committee review of the Retirement Villages Act 1999 (Qld) (Act) has been complete for some time now and the process of implementing the recommendations is slowly moving along.
Earlier this year the Minister for Housing and Public Works responded to the Parliamentary Committee’s report. In his response the Minister noted:
- 12 of the recommendations are supported by the Government and are to be implemented as a priority;
- 6 of the recommendations are supported but require consideration as to how they will be implemented; and
- 19 of the recommendations require further investigation and consultation with stakeholders as well as completion of any necessary Regulatory Impact Statement assessments.
Does this really matter for operators at the moment? Yes…irrespective of what happens, there are areas of priority that operators should consider and identify any associated risks for their businesses.
Whilst waiting for the implementation of prioritised recommendations, operators can be taking steps to ensure that there is as little impact as possible on their business when the recommendations are put into action.
We consider the focus areas and what operators can do to prepare for the coming amendments where possible.
What are the 12 prioritised recommendations and how could they impact operators?
Availability of certain rebates, subsidies and assistance are not available to residents of retirement villages
There is conflict between numerous laws as to whether or not a resident in a retirement villages is treated as an “owner” of the resident’s accommodation unit.
Implementation of this recommendation on the face of it is straight forward, however, the consequential amendments of the local and federal government laws to make these rebates, subsidies and assistance available to residents of retirement villages may take some time.
Operators should consider whether there is anything that they can do to existing and newly constructed villages to assist residents in obtaining these rebates (e.g. for electricity, water, etc).
Non-retirement villages being marketed or represented as being “retirement villages” as defined in the Act
Operators and managers should consider whether the retirement village they are operating is a “retirement village” as defined in the Act.
“Retirement village” is defined in the act as “…premises where older members of the community or retired persons reside, or are to reside, in independent living units or serviced units, under a retirement village scheme.
If you are concerned about whether the premises are in fact a retirement village and should be registered under the Act, please contact us and we can assist in resolving this issue.
Prospective residents obtaining legal and financial advice
It is common that prospective residents are advised to obtain independent legal advice on the terms of the residence contracts and their rights under the Act.
It is recommended that residents who choose not to obtain legal and financial advise sign a provision in a residence contract confirming they chose not to obtain the advice.
Despite this recommendation being implemented, operators should consider implementing their own procedure in this regard from a risk management perspective.
It is also recommended that the Public Information Document be amended to include a provision highlighting the importance of obtaining independent legal and financial advice. Implementation of this recommendation would involve publication of a new approved Public Information Document.
When the new Public Information Document would have to be used by operators will be unknown but there may be a transition period and/or a drop dead date by which all Public Information Documents issued to prospective residents must be in the new form.
Generally the lead in time for such a change will provide operators with adequate time to prepare new form Public Information Documents for distribution to prospective residents.
Clarifying who, and what, the dispute resolution process in the Act applies to
The uncertainty of the application of the dispute resolution process is to be clarified. That is, whether it applies only to disputes between a resident and operator about a residence contract or whether it is intended to extend to:
- any dispute between an operator and a resident; and
- disputes between residents.
The outcome of this recommendation may require some procedure changes for operators but what those may be remains to be seen.
Clarify operators’ obligations regarding charging fees to prospective, current and former residents for selling rights to reside
Whilst it seems to be suggested that this recommendation be implemented through publication of a fact sheet, there may be amendments required to the Act to close the loopholes that may exist.
Operators should consider how their sales process is structured (e.g. though a separate entity which controls the sale and charges a commission to a resident on the sale) and whether this should be changed pending implementation of this recommendation.
Reinstatement of accommodation units
It is intended to make operators and residence aware of their respective obligations regarding reinstatement works for units in a village.
The publication of a fact sheet by the Department is the first step in the process of clarifying obligations regarding reinstatement works.
The key step of amending the Act will be implemented following consultation with stakeholders and completion of a Regulatory Impact Statement (if required).
Operators should consider their processes for determining what reinstatement work is required to be undertaken to reinstate an accommodation unit to a “marketable condition” and whether they are acting reasonably in the circumstances.
Public Information Documents
The Department is to review the current form of Public Information Document to improve the layout of information, reduce the length and complexity, simplify, remove unnecessary repetition, ensure information is provided in plain English and that key terms and considerations are included.
There is little that can be done to prepare for what may be the new form Public Information Document. Implementation of this recommendation may take some time with residents, operators and peak organisations likely to have feedback on the format proposed by the Government.
It is also recommended that Public Information Documents be provided to prospective residents at least 10 business days before an application to reside is completed, before any contract is signed and before any funds are paid to an operator.
There has been no indication on whether implementation of this recommendation would also permit prospective residents to waive this requirement or how it is proposed to interact with the current cooling-off period under the Act.
When the 10 business day period is implemented Operators will need to consider processes and procedures that are currently in place to ensure that residents are provided with the full 10 business days before committing to the village.
Operators should keep in mind that the prioritised recommendations will be implemented.
You can look at current policies and procedures to ensure that you are doing all that you can from a risk management perspective (e.g. with recommending that residents obtain legal advice) and to reduce the impact when the recommendations are implemented.