Proposed Amendments to the Queensland Retirement Villages Act
25 Aug 2017
On 10 August 2017, the Housing Legislation (Building Better Futures) Amendment Bill 2017 (the Bill) was introduced into the Queensland Parliament. The Bill was referred to the Public Works and Utilities Committee and the Committee is due to report to the Parliament by 28 September 2017.
The Bill if passed by the Parliament in its present form or substantially in its present form (Amending Act) will significantly amend the Retirement Villages Act 1999 (RV Act). The proposed amendments relating to the RV Act in the Bill are extensive, comprising 65 sections and 73 pages of the Bill.
Due to the extent of the proposed amendments, we will issue a series of brief summaries on the major changes proposed by the amendments affecting the Retirement Village Industry and operators. This is the first in the series.
There are some matters in the proposed amendments that will have a retrospective effect for operators. However, the only matter we are addressing today that has a retrospective impact on operators is the change in the timing of payment of exit entitlements which is explained below. We will raise other matters that have a retrospective effect for operators in future summaries on the proposed amendments.
- Village Comparison Document (VCD) – replaces the Public Information Document (PID)
- All operators of registered villages prior to the commencement of the Amending Act (Commencement) must prepare a VCD
- The VCD is to be published on the Scheme’s website (every operator must maintain a website) and be included in any promotional material
The VCD provides information about the Scheme to potential residents including:
- types of accommodation, facilities and services; and
- amounts payable by or to residents or the operator.
PIDs in effect before the Commencement will continue in effect for residence contracts in force before Commencement.
- New Prospective Costs Document for the Residence Contract – provides a summary to prospective residents of the estimated costs of moving in, living in and leaving the Village.
- New Unit Condition Reports: Start of Residency/End of Residency - a new process for operators and residents to complete condition reports on units at both commencement and termination of residence contracts.
- Residence Contract – operators must not enter into a residence contract until 21 days after the operator has given the prospective resident the residence contract, VCD and Prospective Costs Document.
However, there is an exception. A prospective resident may sign a residence contract in less than 21 days of receiving the residence contract, VCD and Prospective Costs Document if they have signed a waiver stating they have received legal advice from a lawyer about entering into the contract.
It is important to note that despite the above amendments, the Bill in its current form does not:
- remove the cooling-off provisions available to residents to rescind residence contracts; or
- alter the start dates of the cooling-off period.
- General Services Charge/General Services Charges Fund – for the first time these terms will be defined under the RV Act. The definitions do not result in any material change to how general services charges are currently treated by operators.
- Exit Entitlement – These amendments will require operators to pay residents their exit entitlement 18 months after the residence contract is terminated, unless to do so would cause the operator undue hardship. The amendment will apply to new and existing residence contracts ie where a resident has already left the village the 18 month period of payment of the exit entitlement will commence from the date of assent of the amendment, not the date of the resident’s departure.
An operator must pay the exit entitlement at the end of the 18 month period and if the parties do not agree on the resale value, the operator must obtain a valuation not more than 14 days before the payment date.
An operator may obtain an order fixing a later date to pay the exit entitlement (or pay by instalments), if QCAT is satisfied the:
- operator is unlikely to sell the unit prior to the end of the 18 month period;
- operator is likely to suffer financial hardship; and
- order would not be unfair to the former resident (QCAT may have regard to submissions from the former resident).
- Proposed Approved Forms – the Bill proposes that the Department of Housing and Public Works will issue approved forms for use by operators for the following documents:
- Village Comparison Document (VCD)
- Prospective Costs Document
- Unit Condition Reports
- Residence Contract
- Waiver - for the 21 day waiting period before entering the residence contract
- Maintenance Reserve Fund Budget
- Capital Replacement Fund Budget
- General Services Charges Budget
If you have any queries related to the content of this article, please contact us.
This article is for information purposes only and should not be taken as legal advice.