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The report of the Victorian Enquiry into the Retirement Housing Sector has proven to be a damp squib and disappointed many genuinely aggrieved Victorian residents of retirement villages.

The enthusiasm with which it was greeted by the Property Council of Australia’s Victorian Division, when it was released on 7 March 2017, is a strong indication that it was a fillip to developers and brush-off to resident retirees.

The Property Council proposed that there should be a special industry Advocate to represent residents’ interests and did not endorse the Committee’s recommendation for the appointment of an Ombudsman for the sector.

The Financial Ombudsman Service nationally has done little to help bank customers other than to forestall legal proceedings, while complaints to the Financial Ombudsman Service are considered. However, FOS bends over backwards to see things the banks’ way and even where it finds wrongdoing by a bank, generally proposes minimalist redress, from the borrower’s perspective. Rarely is there a satisfactory remedy achieved for a borrower which does justice between the parties through the FOS complaints process.

I am no big fan of Ombudsmen. I rather prefer considered and strategic law reform which provides effective consumer protection.

The Chair of the Retirement Housing Enquiry Committee, Margaret Fitzherbert MLC, introduced the Report by stating that “The Committee was not tasked with solving every problem identified by those who contributed to the enquiry.” She expresses satisfaction that “Most residents are happy in their retirement community”. Recognising that many residents did not (and may still do not) understand their management contracts and did not receive proper legal advice, she recommends that the Law Institute of Victoria support better training for the legal profession.

At page 10, under “Key Concerns”, the Committee noted that developers are encouraged to look for strategies to redevelop facilities to a more expensive form of retirement housing because they are not content to see the owners of Independent Living Units (“I.L.U.s”) obtain the benefit of capital gains themselves. (Section 1.3.3 at p.10).

The Committee appears to see nothing wrong with retirement village developers undermining the property rights of I.L.U. owners and fails to call out industry malpractice for what it is.

At Section 5.1 on page 45, the Committee appears to have found that residents ought to have known that buying into a Retirement Village is a “terrible investment but if you want a lifestyle, it is a reasonable investment based on the contract”.

The Consumer Action Law Centre believes that many retirees enter into villages falsely believing they are buying a property rather than a licence to reside in a property.

With respect, that is largely because of the way in which such properties are marketed and the duplicity of Retirement Village operators in the way they describe interests, inconsistently with the substantive interest being conveyed.

All in all, the Committee seems to have accepted the industry’s self-promotion over the complaints of hundreds of residents who had made submissions and, in a rather superficial and generalised manner, the Report appears to accept that operators are providing what the residents are paying for.

You may see a lot of retirement villages painted white in Victoria in years to come, since the Victorian Parliament has given the Victorian Retirement Housing Sector a pretty thorough-going whitewash.

At Levitt Robinson, we are ready to challenge what we see in many instances constitutes de facto elder abuse and unconscionable conduct by the industry, committed against retirees in the sector.