A recent case before the Commercial and Consumer Tribunal involving residents and the operator of a Mackay retirement village emphasises the inability of the Tribunal in retirement village disputes to exercise equitable remedies.
In the February case of Galletly v. Carlyle Villages Pty Ltd, Moray and Augusta Galletly (Mr and Mrs Galletly), who are residents of Mackay's Carlyle Gardens, sought orders to have their registered lease amended to change the commencement date to 1 June 2002 and to change the preference of the capital gain lease option.
The operator of Carlyle Gardens is Carlyle Village Pty Ltd (Carlyle Village) who opposed the orders principally on the ground that the Tribunal lacked jurisdiction to amend a registered lease, as to do so would constitute the granting of the equitable remedy of rectification. Despite this objection, Carlyle Village didn't dispute that the Tribunal had the jurisdiction to make findings as to the proper construction of a residence contract.
Issues considered by the Tribunal
At the time that Mr and Mrs Galletly signed an Agreement to Lease on 28 November 2001, the unit that they were to occupy had not been constructed. The commencement date of the lease was to be the day that a certificate of classification was issued for the unit. The draft lease attached to the Agreement for Lease was not signed at that time.
The registered lease contained the signatures of Mr and Mrs Galletly on 1 July 2002 and was subsequently signed by Carlyle Village on 15 July 2002. In the registered lease the preference as to non-capital appreciation lease had been selected.
Mr and Mrs Galletly, who were 85 and 82 respectively, gave evidence at the hearing. Statements were provided by a former director of Carlyle Village and also by the operations manager and project manager for the village at the relevant times. A former manager of the village also gave evidence on behalf of Carlyle Village.
Mr and Mrs Galletly argued that they did not reach an agreement with the scheme operator as to the lease option and that the selection in the registered lease must have been placed there by some other person without their consent after they signed the final lease.
The Tribunal had to make a finding as to the credibility of Mr Galletly. The Tribunal took the view that his evidence was full of inconsistencies and at times he contradicted himself. Mr Galletly also refused to answer questions where he thought the answer would not advance his case.
The witnesses and statements provided by Carlyle Village were accepted by the Tribunal.
Findings of the Tribunal
The Tribunal found that the registered lease was signed by Mr and Mrs Galletly on 1 July 2002 and that both signatures indicated a conclusive agreement to the non-capital appreciation lease option marked in the lease, despite Mr and Mrs Galletly having claimed that they did not read the document before they signed it. The Tribunal referred to High Court authority to confirm the significance to which the law attaches to the signature on a contractual despite the document not having been read before it was signed.
The Tribunal also held that Mr and Mrs Galletly's signatures were conclusive of their agreement that the commencement date of the final lease was 1 July 2002.
The Tribunal decided in considering the argument by Carlyle Village that it did not have jurisdiction to rectify a residence contract on equitable grounds that:
- The application by Mr and Mrs Galletly to amend the registered lease did not constitute a retirement village dispute under the Commercial and Consumer Tribunal Act 2003 (CCT Act) as it was not a dispute about the parties' rights and obligations under the Retirement Villages Act (RV Act) or a dispute about rights and obligations under the residence contract.
- A claim to amend the registered lease goes behind the residence contract itself.
The message for retirement village operators
Whilst the Tribunal has wide powers in hearing retirement village disputes, those powers do not extend to equitable remedies.
Operators will be better placed to refute any claims that a residence contract does not reflect what a resident may have agreed to where they are able to easily refer to the relevant signing practices and procedures adopted by a village at the time a particular residence contract is entered into.
A copy of the full decision can be located at www.tribunals.qld.gov.au/RV/rvDecisions.shtm .
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