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NSW Retirement Village Operators: COVID-19 - Temporary Compliance Relief

Donna Rayner, Rosemary Southgate, Rohan Harris & Sylvia Mansour

The NSW Minister for Better Regulation and Innovation, Kevin Anderson, recently made a number of Ministerial Orders (6) to provide temporary exemptions for non-compliance with certain provisions of the Retirement Villages Act 1999 (NSW) (“RV Act”) and the Retirement Villages Regulation 2017 (NSW) (“RV Regulation”) in circumstances where the operator is acting in accordance with an Order issued under the Public Health Act 2010 (NSW) (“Public Health Order”).

The Ministerial Orders refer to a number of Public Health Orders which applied at the time the Ministerial Orders were made.However, operators must ensure they are aware of the relevant Public Health Order that is in effect when seeking to rely on any of the exemptions in the Ministerial Orders as the Public Health Orders continue to change as the COVID-19 circumstances change.

All of the Ministerial Orders commenced on 29 May 2020 and the majority (5) continue in force until 26 September 2020 (“Prescribed Period”) except for the Retirement Villages (COVID-19 Budget and Expenditures) Order 2020 which commenced on 29 May 2020 and continues in force until 31 December 2020 (“Budget Prescribed Period”). Below is a summary of compliance exemptions under these Orders.

1 - Retirement Villages (COVID-19 Services & Facilities)
Order 2020

Temporary variation, reduction or withdrawal of services and facilities (sections 60 to 62 of the RV Act)
During the Prescribed Period, an operator will be exempt from complying with sections 60 to 62 of the RV Act if the operator temporarily varies, reduces or withdraws services and facilities usually provided at the village. In order to be exempt, the operator must give 3 days’ written notice to the residents, specifying the reason and period the decision applies. The operator is not authorised to make any variation to essential services or any services that impedes an operator’s obligation to provide safe premises.

2 - Retirement Villages (COVID-19 Meeting Requirements)
Order 2020

Meetings
During the Prescribed Period, an operator may choose:
  1. not to convene a meeting with a resident, the residents or a meeting with the Residents’ Committee; or
  2. to convene an ‘alternative meeting’ with a resident, the residents or the Residents Committee via audio-link or audio-visual link that enables communication between the relevant parties where:
    1. the operator believes on reasonable grounds holding such a meeting would pose a risk to the health and safety of residents and the operator in relation to COVID-19; and
    2. convening such a meeting in person would contravene a Public Health Order for COVID-19.
An operator may be exempt during the Prescribed Period as follows:
  • New Operator convening a meeting of residents (section 41(1) of the RV Act)

    If the new operator chooses to convene an ‘alternative meeting’ – the ‘alternative meeting’ must be held within 28 days before they become the operator and report on their financial ability to operate the village and their plans for the future management and operation of the village. 

    If the new operator chooses not to convene a meeting of the residents or hold an ‘alternative meeting’ – at least 28 days before they become the operator they must provide a written report on their financial ability to operate the village and their plans for the future management and operation of the village. This report must include an invitation for residents to submit written questions which the operator must respond to within 5 days.

  • Right to request resident’s current village contract information meeting (section 69A of the RV Act)

    If a request has been received by the operator, the operator can choose to hold an ‘alternative meeting’ provided this meeting is convened within 30 days of receipt of such request and the operator gives a written summary explaining the residents’ current contract information. An operator must not convene any alternative meeting unless the resident has access to the alterative meeting facilities and the resident is given at least 7 days’ notice of the meeting.

  • Meetings between the Residents’ Committee and operator (section 72(1), 72(3) and 72(4) of the RV Act)
    If the Resident’s Committee or the operator choose to convene an ‘alternative meeting’ – the meeting may take place provided the Residents Committee and the operator have access to an alternative meeting and are given at least 7 days’ notice of the alternative meeting

3 - Retirement Villages (COVID-19 Village Rules) Order 2020

Amendments to Village Rules (section 51 of the RV Act)
An operator is permitted to make temporary amendments to village rules without the need for a special resolution of the residents or any other consent process where it is to give effect to a Public Health Order for COVID-19 and provided the operator gives 3 days’ prior written notice to residents. The notice must include the reasons for the decision to amend a village rule, including the relevant provision of the Public Health Order which necessitated the decision and the period during which the amendment to the village rules will apply. Such amendment will take effect immediately. The amendment must not be inconsistent with a Public Health Order and must not compromise the safety of village residents.

4 - Retirement Villages (COVID-19 Budget and Expenditures)
Order 2020

Annual meetings (section 72A(2) of the RV Act)

An operator must hold an annual management meeting within 6 months after the end of the financial year if the operator is unable to convene it in accordance with section 72A(2) of the RV Act (being within 4 months after the end of the relevant financial year) because to do so would contravene a Public Health Order for COVID-19 and the operator is reasonably satisfied that convening it would pose a risk to the health and safety of the residents. An ‘alternative meeting’ can be convened via audio link or audio visual link communication if the residents have access to the alternative meeting facilities.

Consent to variation of recurrent charges (section 107(1) and 107(2) of RV Act)
If the recurrent charges are being varied (otherwise than by fixed formula) by an amount exceeding CPI, the operator is only authorised to make the variation during the Budget Prescribed Period if:
  1. the affected residents consent to the variation;
  2. consent is given in way that does not contravene a Public Health Order for COVID-19; and
  3. the residents concerned meet, consider and vote on the proposed variation within 45 days after receiving a notice under section 106 of the RV Act.

Consent must be obtained in accordance with Retirement Villages (COVID-19 Consent of Residents) Order 2020 (refer to paragraph 6 below).

Residents’ consent to expenditure (section 114(1) and 114(4) of the RV Act)
A proposed annual budget (or amended budget) will be effective if:
  1. the operator seeks the consent of the residents to the expenditure itemised in the proposed annual budget; and
  2. consent is given in a way that does not contravene a Public Health Order for COVID-19; and
  3. the residents concerned must meet, consider and vote on the budget within 45 days of receiving notice under section 106 of the RV Act and advise the operator whether the budget is approved or not. If not approved, they must specify the item(s) in the budget they object to.

Consent must be obtained in accordance with Retirement Villages (COVID-19 Consent of Residents) Order 2020 (refer to paragraph 6 below).

Residents’ consent to appointment of auditor (section 118C(1) – (3) of the RV Act)
For the purposes of the appointment of an auditor of the village accounts, an appointment may be made if:
  1. the operator seeks the consent of the residents;
  2. consent is given in a way that does not contravene a Public Health Order for COVID-19; and
  3. the operator provides each resident with the “consent request notice” (as set out in section 118C(1)(b) of the RV Act); and
  4. within 45 days after the consent request notice, the residents meet, consider and vote on the proposed appointment and notify the operator whether or not they consent to the appointment.

Consent must be obtained in accordance with Retirement Villages (COVID-19 Consent of Residents) Order 2020 (refer to paragraph 6 below). 

5 - Retirement Villages (COVID-19 Access to Retirement Villages)
Order 2020

During the Prescribed Period, the operator may be exempt from non-compliance with sections 169 (operator not to interfere in sale) and 177 (operator not to interfere in letting) of the RV Act and clause 11(2)(d) and (e) of Schedule 3A of the RV Regulation, if certain conditions are satisfied.

For example, during the Prescribed Period, the operator is authorised to introduce “control measures” at the village such as, an action, activity, rule or guideline to prevent or reduce the occurrence or spread of COVID-19 within the village. These control measures may temporarily limit or remove access to the village or parts of the village by residents and non-residents in relation to the sale, letting or sub-letting of premises, notwithstanding that such control measures may interfere with a resident’s right to sell, let or sublet their premises.

However, an operator would not be entitled to implement control measures where it is inconsistent with a Public Health Order, the premises are vacant and there is a low risk to the health of other residents from prospective purchasers or real-estate agents.

The operator must give all concerned residents and any known appointed real estate agents written notice of its decision to introduce such control measures within 3 days of the decision being made.

6 - Retirement Villages (COVID-19 Consent of Residents)
Order 2020

Under this Order, residents and operators of a retirement village are exempt during the Prescribed Period from non-compliance with section 9 and schedule 1 of the RV Act as well as the Schedule 6 provisions relating to consent of residents in the RV Regulation. This means residents’ votes in relation to a measure or action, during the Prescribed Period, can be given by means of written ballot, postal ballot, electronic means (such as, teleconference, video-conferencing or email) or other electronic means (such as, a voting website) while participating in a meeting or before a meeting or a combination of any of these.

We are here to help

If you require any further information please contact Donna Rayner (03) 9609 1503, Rosemary Southgate (03) 9609 1579, Rohan Harris (02) 8987 0024 or Sylvia Mansour (02) 8987 0052,

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