Changes to the Retirement Village legislation came into effect on 1 April 2015 by way of the Retirement Villages Amendment Regulations 2015 (New Regulations) and the Fair Trading (Retirement Villages Code) Regulations 2015 (New Code).
The changes are aimed at providing residents with clearer information about fees and charges and raise the bar on operator accountability to residents.
The New Regulations include:
- specific worded provisions in residence contracts:
- provisions relating to the charges and fees a resident will pay across the term of the contract;
- details about personal and communal services and communal amenities the resident will receive or have access to if they move into the village;
- provision that the administering body may not vary a provision or availability of a communal service or communal amenity or introduce a new communal service unless the residents consent by way of special resolution;
- the right of a resident to carry out urgent repairs to the residence that are the responsibility of the administering body;
- if the residence contract relates to premises in an existing village a warranty that the premises will be in a reasonable condition when the resident takes occupation;
- prescribed worded form relating to termination and the residents right of occupation.
- Matters that must not be included in residence contracts (e.g. provisions giving the administering body or close associate a power of attorney, a requirement that exit fees be calculated on a pro rata daily basis.
Note: the prohibited provisions will commence on 1 October 2015 and will apply to all residence contracts. The New Regulations that apply to the content of residence contracts will commence 1 October 2015.
The New Code includes:
- Auditing financial statements (unless residents agree otherwise by special resolution).
- More comprehensive reserve fund budgeting and reporting (these provisions will apply to existing retirement villages from 2016/2017 financial year onwards).
- provisions providing that residents must be given detailed information about proposed refurbishment of residential premises and the charges associated with these where residents are contractually required to contribute to the cost of the work.
- Extending the State Administrative Tribunal’s existing jurisdiction to deal with refurbishment disputes.
- Residents voting at a meeting of resident can elect to vote by secret ballot.
- Capacity for residents to confer functions of a residents’ committee on an incorporated association.
Note: except for the budgeting and reporting requirements not applying to existing retirement villages until 1 July 2016, all other provisions of the New Code commenced 1 April 2015.