Arthur Koumoukelis and Lucinda Smith

COVID-19 Ministerial exemptions under the NSW Retirement Villages Act

Arthur Koumoukelis and Lucinda Smith

June 9, 2020

Aged Care Legislation Updates Retirement Villages

Recent changes to the Retirement Villages Act 1999 (NSW) (Act) under sections 204 and 205, now allow the Minister for Better Regulation and Innovation to grant exemptions from compliance with specified provisions of the Act which would otherwise require non-compliance with a public health order issued under the Public Health Act 2010 (NSW) related to COVID-19 (Public Health Orders). On 27 May 2020, six exemption orders were made by the Minister and are available here.

Each Exemption (except one) is effective for a limited period, starting from 29 May 2020 and ending on 26 September 2020. The exception is the Budget and Expenditure order which starts 29 May 2020 and expires on 31 December 2020.

The Exemptions all refer to three specific Public Health Orders set out below but the definition of Public Health Order in the Exemptions means they can apply to any Public Health Order issued that is relevant to the operation of the retirement village. The importance of this is that one of the Public Health Orders listed in the Exemptions has in fact already been superseded by a later Public Health Order that would apply.

In order to rely on the Exemptions, village operators have to identify the relevant Public Health Order and determine if complying with a specified provision of the Act would contravene that Public Health Order.  If it does, then the operator would apply the provisions of the Exemption to deal with how they are to comply with the provisions of the Act.

The specific Public Health Orders referred to in the Exemptions are:

  1. Public Health (COVID-19 Spitting and Coughing) Order 2020 
  1. Public Health (COVID-19 Restrictions on Gathering and Movement) Order (No 2) 2020, this order however has been revoked and replaced with Public Health (COVID-19 Restrictions on Gathering and Movement) Order (No 3) from 1 June 2020
  1. Public Health (COVID-19 Self-Isolation) Order 2020

The conditions prescribed for each Exemption are set out below.

The objective of each Exemption is to exempt the operator from liability for non-compliance with the specified provisions of the Act in circumstances where the operator is acting pursuant to a Public Health Order.

Ministerial Order 1 – Services & Facilities

This order exempts the operator from liability for non-compliance with the following provisions of the Act:

  • section 60 variation in services or facilities provided at village;
  • section 61 operator not to reduce or withdraw certain services and facilities; and
  • section 62 consequence of unlawful variation in services and facilities.

For example, the operator may need to vary availability of a library, pool or other common area within a retirement village in accordance with social distancing requirements under a Public Health Order.

This exemption allows the operator to temporarily vary/reduce the services and facilities of a retirement village without the consent of the residents. The operator has to notify all residents in writing of any such decision, explain the reasons and relevant provisions of the applicable Public Health Order within 3 days after the decision was made. The operator also has to inform all prospective residents of any such decision by attaching a notice to the disclosure statement.

Ministerial Order 2 – Meeting Requirements

This order exempts the operator from liability for non-compliance with the following provisions of the Act:

  • section 41 new operator to convene meeting of residents;
  • section 69A right to request residents current village contract information meeting; and
  • section 72 meeting between Residents Committee and operator.

For example, the operator may be required to convene a meeting of residents under the Act which is in excess of the number of people permitted to gather in one place in accordance with social distancing requirements.

This order allows a proposed new operator to choose not to convene a meeting of the residents in person or convene an alternative meeting (which is defined, such as audio link; audio-visual link) instead or convene a meeting of the residents in person if certain conditions are met. Similar provisions apply to a meeting of the operator and a Residents’ Committee.

The operator may choose not to convene a meeting in person with a resident to explain the resident’s current village contract information, notwithstanding that a request in writing has been made by a resident. However in such case, the operator must convene an alternative meeting within 30 days of the request for the meeting being received by the operator. A meeting in person to discuss a resident’s current village contract information is possible if certain conditions are met.

Ministerial Order 3 – Village Rules

This order exempts the operator from liability for non-compliance with the following provisions of the Act:

  • section 51 amendment of village rules.

For example, the operator may need to make a temporary rule regarding access to facilities such as pool, gym and common areas within a retirement village or relating to the visitors and guests of a resident. Noting however that these facilities are themselves the subject of changes to the Public Health Orders.

This order allows the operator to make temporary amendments to village rules specified in Schedule 1 to this order, without the need for a special resolution of the residents or any other resident consent process. The operator must notify all residents in writing of such a decision prior to or within 3 days after the decision was made.

Ministerial Order 4 – Budget Processes & Expenditures

This order operates:

to exempt the operator from liability for non-compliance with the following provisions of the Act:

  • section 72A annual management meeting to be held by operator;
  • section 107 residents’ consent to variation;
  • section 114 residents’ consent to expenditure; and
  • section 118C annual consent by residents for appointment of an auditor,

to exempt the residents from liability for non-compliance with the following provisions of the Act:

  • section 107 residents’ consent to variation;
  • section 114 residents’ consent to expenditure; and
  • section 118C annual consent by residents for appointment of an auditor.

For example, the operator is not allowed to give effect to a proposed annual budget unless the residents consent to the proposed budget. This normally involves a meeting of the residents which may not be possible for larger villages because of social distancing requirements.

This order provides that residents’ consent to a proposed annual budget (or an amended annual budget) must be given in a way that does not contravene a Public Health Order and in accordance with Ministerial Order 6 – Consents of Residents. The residents will have 45 days to consider a budget notice.

Residents’ consent to a variation of recurrent charges by non-fixed formula exceeding a variation in CPI (section 106) must be given in a way that does not contravene a Public Health Order and in accordance with Ministerial Order 6 – Consents of Residents. The residents will have 45 days to consider section 106 notice.

Residents’ consent to the appointment of an auditor of the village accounts must be given in a way that does not contravene a Public Health Order and in accordance with Ministerial Order 6 – Consents of Residents. The operator has to provide each resident with the usual consent request notice under the Act and the residents will have 45 days to consider and notify the operator of their decision.

This order also allows the operator to hold an annual management meeting of the residents no more than 6 months (instead of 4 month under the Act) after the end of each financial year. The meeting may be in person or by means of audio or audio-visual link.

Ministerial Order 5 – Access to Retirement Villages

This order exempts the operator from liability for non-compliance with the following provisions of the Act:

  • section 169 operator not to interfere in sale; and
  • section 177 operator not to interfere in letting.

in addition to the following provisions of the Retirement Villages Regulation 2017 (NSW) (Regulations):

  • clause 11(2)(d) and (e) of Schedule 3A.

For example, if the operator interferes with a resident’s right to sell, let or sublet their residential premises, the resident may apply to the tribunal for relief. This is despite the fact that the operator may be acting pursuant to a Public Health Order.

This order allows the operator to introduce control measures (rule; guideline; action; activity) that temporarily limit or remove access to villages or parts of villages by residents and non-residents, in relation to the sale, letting or subletting of premises, notwithstanding that such control measures may interfere with a resident’s right to sell, let or sublet their residential premises in the village.  Access to vacant units is specifically referred to as being potentially easier and more appropriate to access.

The operator has to notify all concerned residents and real estate agents known to the operator, of a decision to introduce such control measure within 3 days after the decision was made.

Ministerial Order 6 – Residents Consent

This order exempts the residents and operator of a retirement village from liability for non-compliance with the following provisions of the Act:

  • section 9 consent of residents; and
  • Schedule 1 consent of residents,

as well as the following provisions of the Regulations:

  • Schedule 6 provisions relating to consent of residents.

This order allows the operator to take a residents’ vote in relation to a measure or action by means of written ballot, postal ballot, teleconference, video-conferencing, email or other electronic means while participating in a meeting (e.g. a voting website), email or other electronic means before the meeting, or their combination as decided by the residents.

For further information, please contact a member of our national Health, Aged Care and Retirement Village team.

Authors

Arthur Koumoukelis | Partner | +61 2 8248 3437 | akoumoukelis@tglaw.com.au

Lucinda Smith | Partner | +61 2 9020 5748 | lsmith@tglaw.com.au

Maryna Roganova | Senior Associate | +61 2 8248 5881 | mroganova@tglaw.com.au