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Other supported and independent accommodation

Other kinds of supported and independent accommodation for older people are generally provided on a private basis. They include supported residential services and independent living units or serviced apartments in retirement villages, which are regulated under state legislation.

Supported residential services

Providers of supported residential services (SRSs) in Victoria are now regulated by the (the Supported Residential Services (Private Proprietors) Act 2010 (Vic) (“SRS Act”) and Supported Residential Services (Private Proprietors) Regulations 2012 (Vic) . The purpose of these laws is to protect the safety and wellbeing of residents by establishing minimum standards for the accommodation and care provided in these facilities.

Section 5(1) of the SRS Act defines a SRS as premises where accommodation and personal support are privately provided or offered for persons for fee or reward, whether or not the premises are registered under the Act, but does not include a residential care service or a state funded residential care service.

For further information about SRSs, visit the Department of Health website (see below).

Supported Residential Services Unit
Department of Health
Tel: 9096 7467; 9096 8907
Email: srs@health.vic.gov.au
Web: www.health.vic.gov.au/srs

The Office of the Public Advocate provides a Community Visitors Program. Community Visitors are volunteers who are appointed for an inquiry role into the standard of facilities and care provided by SRSs to residents. They can receive complaints from residents and follow them up. For further information see “Community Visitors Program“ in Chapter 16.2: Advocacy and “Contacts“ in Chapter 16.1: Disability Overview, or go to the website at www.publicadvocate.vic.gov.au.

Retirement villages

The retirement village industry is a rapidly growing sector. In Victoria, the Retirement Villages Act 1986 (Vic) (“RV Act”) was amended by the Retirement Villages (Amendment) Act 2004 (Vic) (“RV Amendment Act”), and all amendments became fully operative on 1 August 2006.

The RV Act defines what constitutes a retirement village and seeks to give protection to residents. It requires the land owner to register a retirement village Notice on the title to village land before entering into any contract or agreement with a potential resident and also requires the land owner or manager to provide a disclosure statement to the intended resident in a form prescribed by the Act.

In parts 3 and 5 it gives additional protection to “non-owner residents”, i.e. those residents who do not hold an estate in fee simple as registered proprietors; in particular it gives them a charge over the title to the village land to protect their interest.

Provided all of the residents are aged care recipients under the AC Act, “residential care facilities” within the meaning of the Act are not subject to the RV Act.

Many retirement village owners retain ownership of all land in the village and offer the prospective resident a lease or licence of a unit or apartment for life or for a fixed long-term period in return for payment of a substantial sum of money, which is often referred to as a loan or ingoing contribution. Most loans or ingoings will be repayable subject to deductions after the resident dies or leaves the village. Often repayment is delayed until resale or reletting of the resident’s unit; but in the case of agreements relating to “non-owner residents” entered into after 1 August 2006, the village owner or manager is required to repay the amount due to the resident within six months after the non-owner resident has delivered up vacant possession unless schedules 1 or 2 and schedules 3 or 4 of the Retirement Villages (Contractual Arrangements) Regulations 2006 (Vic) (“RV(CA) Regulations”) are incorporated into the agreement.

In the case of an owner resident, they must be repaid within 14 days after settlement of a re-sale or after a new owner takes up residence if their agreement has been entered into after 1 August 2006.

The RV(CA) Regulations require a village owner to repay some or all of the ingoing contribution to a non-owner resident earlier if the moneys are to be used for an accommodation bond in a residential care facility within the meaning of the AC Act. Retirement village contracts or agreements entered into prior to 1 August 2006 are not affected by the amendments.

The RV Act does not regulate the financial terms of any contract that a village owner and a resident can enter into. It is important that a potential resident obtains legal advice before signing any documents. The RV Act requires that a potential resident be given the “residence documents” at least 21 days before signing, and in some cases also gives the potential resident a further cooling off period of three days after signing.

If it is proven that a person has been given false or misleading information they may be able to avoid the contract even after they have settled and entered into the village.

All retirement villages are required to provide information to Consumer Affairs Victoria to enable that body to maintain a register of retirement villages. Any member of the public may inspect the public information recorded in the register.

Fees and charges

The RV Act restricts the right of the manager to increase ongoing maintenance charges above the consumer price index (CPI) unless the increased charge has been approved by a resolution of a majority of the residents or is approved by resolution of the Residents’ Committee. The Australian Consumer Law and Fair Trading Act 2012 (Vic) (ACL) applies to services or goods provided under a residence contract and to the acquisition of a residence right irrespective of the amount of the price paid.

Most retirement village agreements provide for the resident to pay a deferred management fee on leaving the village. This will usually be a percentage of the resale or reletting ingoing or of the original ingoing calculated according to the number of years the resident has occupied their unit in the village. Most calculations of deferred management fees cease after 10 years, but this is not always the case.

An outgoing resident may also be required to pay repair and refurbishment costs of the unit, which will be deducted from the amount they receive when leaving the village.

Village owners are no longer allowed to charge residents for personal services for more than 28 days after the resident vacates the village, and non-owner residents are allowed to be charged maintenance charges only up to a maximum of six months from the date on which the resident leaves the village. However, owner residents are still required to pay maintenance charges until settlement of any resale of their unit.

Other charges may involve a commission to the village manager for reletting the resident’s unit, although in respect of agreements entered into on or after 1 August 2006, non-owner residents can advise the village owner that they wish the premises to be sold through an independent estate agent under schedules 1 or 2 of the RV(CA) Regulations. Owner residents who entered into contracts after 1 August 2006 are also entitled to use independent estate agents to sell their units, and the village manager is required to co-operate or face resolution of the dispute by VCAT. The incoming resident must agree to sign a management contract.

Annual meetings and reports

The RV Act requires the village manager to convene an annual meeting of residents. The village owner is required to present an annual report, which must be audited unless, at the annual general meeting held in the preceding year, the residents have voted by special resolution to dispense with the auditing requirements.

Disputes

Disputes between residents or between residents and village owners or managers are to be dealt with by mediation, and Consumer Affairs Victoria is the first reference point for residents (see “Consumer Affairs Victoria“ in Chapter 12.4: Consumer Remedies, for more information and contact details).

Village managers are required to set up an operating dispute resolution and complaints handling system to deal with disputes between residents and complaints against the operator and to work with Consumer Affairs Victoria in this area.

Proxies and power of attorney

Proxies are no longer allowed to be sought or accepted by village operators from residents (unless they are relatives) and any provision in a contract (new or existing) requiring a resident to give a proxy to the village manager or owner is void. The enforcement provisions under part 10 of the FTA apply to retirement villages.

The village operator is not permitted to require a resident to give it power of attorney unless the power of attorney was already given in an agreement signed prior to 1 August 2006.

Proposed new regulations

It is anticipated that the Retirement Villages Amendment (Records and Notices) Regulations 2013 and Retirement Villages Amendment (Contractual Arrangements) Regulations 2013 will come in to operation in approximately March 2014. These Regulations will be made pursuant to the Retirement Villages Amendment (Information Disclosure) Act 2013, which will commence on the same date as the Regulations.

The proposed Regulations will result in retirement village operators being required to provide a fact sheet to any prospective resident (at the time of enquiry) and a detailed disclosure statement prior to commitment by a proposed resident.

The Retirement Villages Amendment (Contractual Arrangements) Regulations 2013 will prescribe matters that must or must not be included in residence contracts and management contracts, and prescribe certain terms and the layout of certain residence contracts and management contracts.

General laws

Other, more general, legislation applicable to older people’s supported accommodation includes the Australian Consumer Law and Fair Trading Act 2012 (Vic), which, among other things, deals with misleading, deceptive or unconscionable practices in trade and commerce (see Chapter 12.3: Consumer Protection Legislation). Note also that the Australian Competition and Consumer Commission may investigate cases of widespread and significant detriment to consumers.

Other supported and independent accommodation :: Last updated: Sun Jun 30th 2013