What is the RV Code?
The retirement village industry in WA will be familiar with predecessors to the ‘new’ RV Code. Except for the title, the RV Code is in fact the same as the interim code of practice before it (and several before that) – with the immediate predecessor expiring on 30 September 2019.
The RV Code is prescribed under the Fair Trading Act 2010 (WA). In short, it sets out standards of conduct for the retirement village industry, and guidelines for fair dealing with residents. It covers important rights and responsibilities in relation to: advertising and promotion of retirement villages; a prospective resident’s right to information; contracts; village management; dispute resolution and termination of contracts. The RV Code is enforceable by the Commissioner for Consumer Protection. Where it appears to the Commissioner that a person has carried on business in contravention of the RV Code, the Commissioner may apply to the State Administrative Tribunal for an order under the Fair Trading Act that the contravention cease and/or that the contravention be rectified.
Why is it an ‘interim’ code of practice?
While under sections 44 and 45 of the Fair Trading Act, codes of practice can be prescribed by regulation for a period of up to 3 years, there is also provision at section 46 of the Act for interim codes of practice to be prescribed for a period of up to 6 months at a time. The RV Code is an interim code of this kind. As such, the consultation procedures for a ‘full’ code of practice have not been completed. Hence, the new RV Code will expire 31 March 2020.
Practical considerations for retirement village owners and administering bodies
Retirement village owners and administering bodies should:
- continue to adhere to the current RV Code – just as they have its predecessors;
- consider whether any template / standard form residence contracts, disclosure documents or policies contain old code references, and update these as necessary; and
- expect another new code from 1 April 2020.
Are any more significant reforms to retirement villages laws coming up?
Yes.
The Department of Mines, Industry Regulations and Safety (Consumer Protection Division) is currently undertaking consultation on the full suite of WA retirement villages legislation, being:
- Retirement Villages Act 1992;
- Retirement Villages Regulations 1992; and
- the RV Code (or strictly speaking, the predecessor regulations – being the Fair Trading (Retirement Villages Interim Code) Regulations 2019 (WA)).
The first Consultation Regulatory Impact Statement (CRIS) paper has been released for comment, with a closing date of 27 September 2019. It is available here.
According to Consumer Protection, the first CRIS paper will focus on improving: the definition of a retirement village product; how it is advertised and promoted; and how consumers understand the pricing structure. Further CRIS’s will be released covering:
- “Operator management responsibilities to the village community including clarifying issues such as the owner/operator dichotomy, payment of exit entitlements, capital works, approval of budgets and refurbishment obligations.
- Clarifying the scope of the RV Act including issues such as application to short-term residents, residents’ relatives and partners, aged care facilities on retirement village land and the need for a public database of retirement villages.
- Multi-site villages, scheme termination, memorials and the statutory charge including clarifying current uncertainty about the regulation of multi-site villages, the memorial requirements of the RV Act, statutory charge provisions and the process for terminating a retirement village scheme.
- New village developments (staged developments and redevelopments) leasing off the plan, and multiple residence contracts including issues relating to wait list and holding fees, staged developments and redevelopment and processes for land to be excisable from village land.
- Compliance and enforcement including issues such as whether the head of power for the Fair Trading (Retirement Villages Interim Code) Regulations 2019 should move from the Fair Trading Act 2010 to the RV Act, what enforcement tools the Act should contain and the State Administrative Tribunals jurisdiction”.
These further CRIS’s are scheduled for release throughout 2019-2020.
So, whilst there will inevitably be substantial change to the code of practice applying to retirement villages in WA, we are likely to see more interim codes before the consultation and legislative review is complete.
Please contact David McMullen if you have any queries about the RV Code, other retirement villages legislation, or the consultation currently being undertaken by Consumer Protection.
