Foreseeability and Causation
62 I am also satisfied that the loss arising from Woolcott Village's failures, including the failure to pay the departure fee it owed Mr and Mrs Edwards in August 2005, was reasonably foreseeable and caused by the defendants' breach of their duty.
63 While the defendants advanced submissions in relation to s 129 of the Retirement Villages Act, they are not relevant to this issue. No one other than Woolcott Village had an obligation to make a departure fee payment to Mr and Mrs Edwards, when they left Woolcott Court. I am satisfied that had they been advised in 2001, as they ought to have been, they would not have entered these transactions with Woolcott Village, but would have moved into another of the suitable units available in other retirement villages.
64 The defendants relied on Mrs Gorry's evidence that the ingoing contribution fee at such other units ranged from $120,000 to $400,000, depending on the services and level of care provided and the fact that Mr and Mrs Edwards had selected Woolcott Court as the village which they preferred. Account must also be taken of Mrs Gorry's evidence that at the time there were units available in other villages, at a price which was suitable. Mr and Mrs Edwards required assistance; they had limited means; they depended on the proceeds of the sale of their former residence to fund payment of the required ingoing contribution payment and depended on its repayment as a departure fee in future, if they needed a higher level of care, to enable them to live out their lives in a suitable environment, given their advancing years and frail health.
65 I am satisfied that in 2001, they had available to them the opportunity to take other suitable, available accommodation which they had the funds to acquire. Had they done so, their loss would have been entirely avoided. Causation was established; their transactions with Woolcott Village and the losses which resulted are the direct result of the defendants' failure in 2001 to advise Mr and Mrs Edwards of the risks of the transactions, in breach of the duty owed to them.
Damages
66 Given the breach of their duty to Mr and Mrs Edwards, it follows that the defendants are responsible for any loss which they suffered as the result of that breach.
67 I do not accept the plaintiffs' claim that the costs of the respite care incurred after 8 August 2005, when Mr and Mrs Edwards left Woolcott Village is such a loss. That they were then seeking a higher level of care given their then health, precludes that conclusion. Nor do I accept that the assessment of the damage suffered must commence with the figure of $272,000, as the plaintiffs argued.
68 In 2001, Mr and Mrs Edwards paid $252,000 in cash, with payment of the balance of the $272,000 ingoing contribution to be deducted from the departure fee when it was paid. The plaintiffs' case was that this arrangement involved a breach of the Retirement Villages Act, which does not permit such a deduction from a departure fee. That this is a correct characterisation of what was agreed is doubtful. The definition of 'ingoing contribution' in s 6 of the Act certainly contemplates that such a payment may be made by lump sum, or by instalment. There would seem to be nothing which would preclude such an instalment only becoming payable at the time of the departure fee, as Mr and Mrs Edwards agreed with Woolcott Village. Given their limited means, that delay was obviously to their advantage.
69 It ought not to be overlooked that Mr and Mrs Edwards lost $252,000, the sum paid in 2001 to Woolcott Village, not $272,000. The additional $20,000 of the purchase price still outstanding was never paid. As a matter of logic, if nothing else, a sum which was never paid to Woolcott Village by Mr and Mrs Edwards cannot be regarded as having been a loss which flowed from the defendants' failures.
70 Had the defendants advised Mr and Mrs Edwards in 2001 of what they should have paid by way of ingoing contribution fee, as the plaintiffs argued they ought to have done, Mr and Mrs Edwards would have had to pay a further $20,000, thereby suffering a $20,000 higher loss, when Woolcott Village failed to pay the departure fee it owed them. That, however, is not what happened. All that was paid and lost was $252,000 and accordingly, the calculation of damages must have regard to that sum.
71 Otherwise, the defendants also argued that in assessing damages attention had to be paid to the fact that there was no evidence as to what Mr and Mrs Edwards would have paid by way of ingoing contribution fee at another retirement village, had they not moved into Woolcott Village in 2001, nor what they would have been entitled to receive by way of departure fee, when subsequently leaving such accommodation. This, it was argued, made it impossible to assess damages, the proper measure of which depended on what would have flowed from an entirely different transaction. The best that could be done would be to discount the damages by 50%. Otherwise, the only option would be to conjecture that Mr and Mrs Edwards would not have sold their unit at Hornsby. That they had the value of the occupation of a unit at Woolcott Court for 3 or 4 years, which suited them, could also not be ignored. On the evidence, the value of that occupancy was the $29,000 per annum rent payable under the lease between Sarana and Woolcott Village.
72 For the plaintiffs it was submitted that this latter argument entirely overlooked that Woolcott Village had the use of the $272,000 ingoing contribution for the entire period of Mr and Mrs Edwards' residence at Woolcott Court. As to the idea of a 50% discount, on the evidence it was entirely reasonable for the Court to proceed on the basis that had Mr and Mrs Edwards been advised as they ought to have been in 2001, they would have used the proceeds of the sale of their unit to acquire one of the available units in another village, at a price they were able to pay. On the evidence, other retirement villages operated under the same legislative scheme. Ingoing contribution fees ranged from $100,000 to $400,000. Mr and Mrs Edwards would have paid an ingoing contribution payment which they could afford and would have been paid a departure fee, in accordance with the provisions of the Retirement Villages Act, on their departure. Had Mr and Mrs Edwards gone elsewhere in 2001, as was open to them then, they would not have suffered the loss which flowed from their transactions with Woolcott Village. It followed that they were entitled to be put back into the position they would have been in, had they not entered this contractual arrangement with Woolcott Village, that being the true measure of the loss which flowed from the defendants' breach of their duty.
73 I am satisfied that the calculation of damages must be approached as the plaintiffs argued. It cannot be overlooked that what Mr and Mrs Edwards paid was not only the $12 per annum under the lease, but also fees for services provided, as well as $252,000 of the $272,000 ingoing contribution, which was to be repaid as a departure fee, after deduction of an amount for each day that they occupied the unit. In the meantime, Woolcott Village had the use of the money. Had Mr and Mrs Edwards been properly advised, they would not have suffered the loss of this departure fee, because they would have gone elsewhere.
74 While the defendants relied on the approach of the High Court in Henville v Walker and Another (2001) 206 CLR 459 to support their approach to the assessment of damages, the case was not of assistance, it seems to me. There it was established that the damages suffered did not only result from the contravention of s 52 of the Trade Practices Act 1974 (Cth) in question, but also from other causes, for which the agent who had given the advice in question was not responsible. This was not such a case, of course, but even so, McHugh J, in the majority, took the view that the entirety of the damages there suffered were recoverable in the proceedings, observing: