Frequently Asked Questions

I have acted as a lawyer for retirement village operators in New South Wales since 1985 and in Queensland since 2006. This has ranged from family businesses (like the Henry Kendall Group) through to major publicly listed companies (eg Lend Lease Primelife Limited).  

I have dealt with all the main types of residence rights – strata title, company title, leasehold title (assignable and non-assignable, registered and unregistered, long term and short term) and licence. This covers what are now called registered interest holders and what are now known as non-registered interest holders.

I have dealt with dispute resolution with the Disputes Committee under the former Retirement Village Industry Code of Practice (1995 to 2000) and in the Consumer Trader and Tenancy Tribunal under the current Retirement Villages Act (2000 to date).

As from 1 August 2011 I charge a fixed fee payable in two equal instalments, regardless of the type of residence right or the length of the documentation involved, as follows:

SERVICE

1.Sale of your current residence

• • Fee   $1,200
  • GST  $   120
  • Total $1,320

2. Acquisition of residence right in the retirement village

• • Fee   $1,500
  • GST  $   150
  • Total $1,650

3. Termination of residence right in the retirement village

• • Fee   $1,200
  • GST  $   120
  • Total $1,320

PAYMENT

Half of the above fee is payable on exchange of contracts, or on your deciding not to proceed with the transaction if I have provided advice to you.

The other half of the above fee is due on completion or cancellation of the transaction.

I reserve the right to revise the above fees in future.

Some FAQ’s about LIVING IN a retirement village

What follows is not legal advice based on specific facts or instructions. It is general guidance only and is not a substitute for legal advice. 

1. How can the operator vary village rules, or the services and facilities provided, at a retirement village?

Generally, a special resolution of residents voting in favour of the variation is required.

2. How can the operator vary the recurrent charges I have to pay for services and facilities in the village?

At least 60 days notice of the proposed annual budget for the forthcoming financial year must always be given to you.
If your recurrent charges are to be varied otherwise than in accordance with a fixed formula and the proposed increase exceeds the CPI, you should also receive a notice of variation of your recurrent charge at that time. The residents’ consent by a bare majority approving the budget and the notice is required before either can be implemented.
If your recurrent charges are to be varied otherwise than in accordance with a fixed formula and the proposed increase does not exceed the CPI, the operator must give you at least 14 days notice of the proposed recurrent charge, but no residents’ vote of approval is required. The same applies to a variation in accordance with a fixed formula.

3. Do I get to pay less recurrent charges if there is a budget surplus?

Generally speaking, yes. An audited surplus must be carried forward to the next financial year thereby reducing the amount of recurrent charges you would otherwise have to pay.
Alternatively, residents may vote to spend all or part of the surplus in a particular way or to distribute it equally.

4. Do I have to pay more recurrent charges if there is an audited deficit in recurrent charges?

Generally, no, the operator will have to bear any deficit from funds other than recurrent charges. There are limited circumstances where an operator may seek the consent of residents or of the Consumer Trader and Tenancy Tribunal to recoup a deficit from a surplus or otherwise from recurrent charges.

5. Am I responsible for the cost of repairs to, or replacement of, items of capital in my dwelling?

Yes, in two respects.
Firstly, you are personally responsible for items that you own (like your furniture) and for the rectification of damage in excess of fair wear and tear, if your contract is to this effect.
Secondly, you are collectively responsible with other residents for fair wear and tear via recurrent charges and (if established) the capital works fund. This applies to repairs and maintenance but does not extend to replacements.

6. Can I require the operator to attend to urgent repairs?

Yes, for certain types of ‘urgent work’, such as burst water pipes, serious roof or gas leaks. If you give the operator a reasonable opportunity to attend to the repair and it is not carried out, you may engage a contractor and the operator will be obliged to reimburse you for the reasonable cost.

7. Can I renovate my dwelling?

Generally speaking, yes, provided you first obtain all consents required by law and the written consent of the operator.

8. Can the operator enter my dwelling without my consent?

Yes, in the case of emergency, concern for the welfare of an occupant or to carry out urgent repairs. Prior notice is required to install a smoke alarm or replace its battery (2 days), to carry out general maintenance (7 days) or to carry out a general inspection but only under certain types of residence right (7 days).

9. Does the operator have to respect my privacy and autonomy?

Generally speaking, yes, as do other residents.

10. Can I appoint someone to represent me in dealing with the operator?

Yes, you may nominate a person in your village contract to be your agent to receive notices from the operator. You may appoint a person as your proxy to attend and vote on your behalf for a specific village meeting. You may also appoint a person to be your power of attorney to sign documents generally on your behalf.

11. Can I have someone else come to live with me in my dwelling?

Yes, if that person is (or becomes) your spouse or de facto. The operator may, or may not, consent to other people co-habiting with you. What rights (if any) these people have to remain in your dwelling after you die or permanently vacate the premises is complicated and depends on the circumstances.

Some FAQ’s about MOVING INTO a retirement village

What follows is not legal advice based on specific facts or instructions. It is general guidance only and is not a substitute for legal advice.


1. Do I really like the village, its location, the residents I have met, the services and facilities currently on offer and the particular premises I am considering moving into?

This is the most important question of all, and the only one I cannot help you with.

2. Is the village affordable to me? To check, can I have  Disclosure Statement with a price list of available dwellings and perhaps a copy of a blank contract to look at?

You may, just ask the sales staff for a copy. The Statement will tell you all the entry costs and current ongoing costs to live there, as well as fees and charges payable on leaving the village.

3. Can I have a copy of village accounts to assess the recent financial performance of the village?

You may, just ask the sales staff for a copy of the approved annual budgets and audited accounts for the last three years, and the current proposed annual budget (if it has not been approved). 

4. Apart from the initial entry price, what other entry fees and charges are payable when I move in?

The Disclosure Statement should list these. Normally, this will be a portion of the operator’s legal fees, any registration costs and recurrent charges in advance.

5. Should I then ask for a draft village contract to be sent to a legal advisor with significant prior experience in retirement village law?

Absolutely.  This is a major lifestyle and investment decision, which will have a significant impact on you if you later need to move to an aged care facility, or on your family if you die in the village.

6. Can I change my mind, cancel and get my money back?

Yes, but only in certain limited circumstances.  If you have not signed a contract you may do so. There is a seven business cooling-off period once the contract signed by you is received by the operator.  You can cancel within that time and get a full refund. There is also a 90 day settling-in period once you have moved in. This is a little more complicated. You get most of your money back, but you may have to wait until a new resident has moved into your dwelling after you have left, depending on the type of your residence right.

7. When can I move in?

Normally, you cannot move in until you pay the balance of the entry price and other entry fees, and then not within 14 days of a contract being received by you or your lawyer.  Sometimes exceptions are made on a case-by-case basis. It is a very stressful time so it is best if you can arrange alternative accommodation with friends or family for a night or two if needed.

FAQ’s about MOVING OUT of a retirement village

What follows is not legal advice based on specific facts or instructions. It is general guidance only and is not a substitute for legal advice.

1. For how long do I pay a DEPARTURE FEE after I permanently vacate my dwelling?

You don’t. 
It stops further increasing (or ‘accruing’) on the earlier of (a) the maximum accrual period in your contract or (b) on permanent vacation, calculated on a daily basis. The only exception is under a village contract that commenced prior to 1 July 2000 where the departure fee accrual period is still current. 
Typically, a ‘departure fee’ is a stated annual percentage of either the price you paid for your dwelling or the price paid by the next resident of your dwelling for a certain number of years (eg 3% p.a. for up to 10 years). Sometimes there is an additional lump sum component (eg $10,000 or 2.5%)

2. For how long do I pay RECURRENT CHARGES after I permanently vacate my dwelling?

For 42 days in relation to general services. 
Then you either pay no more or you pay the same share as the share of capital gain that you are entitled to until a new resident moves in. This sharing applies only if you occupy under (a) strata, community or company title or (b) leasehold title where the lease is registered, is for a term of at least 50 years (or life) and entitles you to at least 50% of the capital gain – what is now known as a ‘registered interest holder’.
In relation to optional services, you do not pay recurrent charges after permanent vacation or death.

3. What REPAIRS and replacements do I have to pay for after I permanently vacate my dwelling?

Generally, only for damage in excess of fair wear and tear. There are two exceptions to this. 
First, you are liable to pay for refurbishment including fair wear and tear if your contract commenced prior to 1 July 2000 and provides that you are responsible for refurbishment. This is subject to the operator obtaining three quotes for the relevant works, or you agree to use the tradespersons who ordinarily carry out maintenance in the village. 
Second, and conversely, you do not have to pay for any reinstatement if you a NOT a ‘registered interest holder’ (as described in (2) above) and no prescribed condition report was attached to your contract when you moved in.

4. What COSTS OF SALE do I have to pay for after I permanently vacate my dwelling?

If you are a ‘registered interest holder’ (as described in (2) above) you have to pay any commission charged by a licensed real estate agent that you engage.  That may or may not be the operator, or an entity related to the operator, as long as the agent is licensed.  Other costs of sale charged by the operator are to be shared in the same proportion as your entitlement to capital gain under your contract.
If are not a ‘registered interest holder’, you do not have to pay any costs of sale.

5. Can I choose a selling agent and set the LISTING PRICE for my dwelling?

Yes, if you are a ‘registered interest holder’ (as described in (2) above).
No, if you are not a ‘registered interest holder’ (as described in (2) above).

6. Are there any OTHER FEES or deductions I might have to pay the operator after I permanently vacate my dwelling?

Yes, if there are other fees or charges in your contract that are not otherwise disallowed by law in general or the Retirement Villages Act in particular. 
Common lawful examples are paying the operator’s lawyer’s costs in formalising the termination of your residence right, and fees variously described as a ‘termination fee’ or a ‘surrender fee’ that are not referable to the operator finding a new resident.

7. If I am due a refund by the operator following my permanent vacation of my dwelling, how is my REFUND CALCULATED?

In short, in accordance with your village contract but subject to the provisions of applicable legislation. An operator must provide you with a statement of the calculation of the refund when it is paid. This generally applies under most types of resident right except strata, community, company and assignable leasehold title.

8. If I am due a refund by the operator following my permanent vacation of my dwelling, WHEN is it payable to me?

Generally speaking, on the earlier of 
(a) when your contract provides for the payment to be made, or 
(b) within 14 days of when
(i) a new resident moves into, or pays the operator an entry price, for your dwelling, or 
(ii) a person moves into your dwelling with the consent of the operator (unless this is under a Residential Tenancy Agreement that expressly excludes the provisions of the Retirement Villages Act).

One exception is if you are NOT a ‘registered interest holder’ (as described in (2) above), then you are entitled to be paid the refund six months from permanent vacation even if no new resident has moved in by then. Any entitlement to capital gain is to paid later when a new resident does move in.

Note that most operators insist on your providing certified copies of certain documentation prior to payment (eg registered power of attorney under which a document is executed, grant of probate or letters of administration in the case of a deceased estate).

8. If I disagree with the AMOUNT OR TIMING of the payment of the refund by the operator, what can I do?

You, or your lawyer, should liaise direct with the operator to resolve the problem. If that is not satisfactory you may apply to the Consumer Trader and Tenancy Tribunal for mediation of the problem or, if that fails, an enforceable determination.
 

MOVING INTO THE VILLAGE

I will advise you in relation to the village contract for the residential premises in the retirement village you have chosen. This includes explaining your rights and obligations and arranging your acquisition of the residence right being offered to you. This includes all the conveyancing aspects of the transaction.

SELLING YOUR CURRENT PROPERTY

I can also act for you on the sale of your current residence. Most people are relying on this sale to raise the funds required to move into the retirement village. If you would rather leave the sale with your usual lawyer, that is fine and I will act on the acquisition of retirement village residence right. That is entirely a matter for you.

MOVING OUT OF THE VILLAGE

I can act for you when leaving the village to ensure this goes smoothly and that you are paying fees in accordance with your contract and the Retirement Villages Act so you get the correct refund amount. If you are moving to higher level of care I can also advise on this.

I have drafted many village contracts, and revised them in order to comply with changing regulatory requirements and in the light of decisions of tribunals and courts. 
I have carried out literally thousands of calculations to verify the amount of refunds due to residents on leaving a village.