Hospitals and Health Services Act 1927

The statute is built around a set of repeatable legal concepts that determine how private health facilities operate within the statutory framework.

• Private hospital and private psychiatric hostel as regulated entities. The Act defines private hospital as a hospital that is not a public hospital (s 2). A private psychiatric hostel is separately defined for premises where three or more socially dependent people because of mental illness reside (s 2; s 26P). Part IIIA deals primarily with private hospitals; Part IIIB applies that regime, with modifications, to private psychiatric hostels (s 26Q(1)-(2)).
• Licence and endorsement. "Licence" is the statutory instrument permitting conduct of a private hospital (s 26A). Applicants must meet character, fitness and resource tests (s 26B). Licences may be granted subject to terms and conditions (s 26D(2)-(3)), are valid on grant and renewable annually by regulation (s 26E(1)-(2)), but are non‑transferable (s 26E(3)). A separate endorsement is required to treat or detain persons for mental illness under the Mental Health Act 2014; the CEO cannot make that endorsement without the Chief Psychiatrist’s recommendation (s 26DA(1)-(3A)).
• CEO discretion and administrative machinery. The CEO performs core licensing, approval, inspection, closure and information‑collection functions. The CEO must be satisfied as to premises and arrangements before issuing licences (s 26C; s 26D(1)). The CEO may impose and vary conditions (s 26D(2), (7)), enforce remedial work or close unsafe facilities (s 26G), direct provision of information (s 26S), and is involved in endorsement cancellation decisions after consultation with the Chief Psychiatrist (s 26FA(1)-(2A)).
• Inspection, examination and enforcement. Persons authorised by the CEO may visit and inspect private hospitals and, if a medical practitioner, medically examine a patient subject to procedural limits (s 10(1)-(2)). Obstructing authorised persons or wilfully misleading them is an offence (s 11). Several conduct offences are central: operating without a licence or approved premises or performing building works without CEO approval (s 26K); failing to comply with licence conditions (s 26L); failing to comply with CEO remedial orders (s 26G(2)).
• Information powers and protection. The CEO may direct private hospital service providers to give information, including personal information, provided it relates to hospital, health or psychiatric services and is consistent with the statutory collection purpose for regulation and health‑related research (s 26R; s 26S(1)-(3)). Disclosure in compliance with a direction attracts statutory protection from civil or criminal liability and is not to be regarded as breach of confidentiality or professional standards (s 26T).
• Financial instruments and conditionality. The Governor may make grants or subsidies from appropriated moneys to licensed private hospitals, but such grants are conditioned on compliance with the regulations and CEO directions (s 26I(1)-(2)). The Minister may, with Treasurer's approval, make payments to religious or charitable organisations to defray interest on loans for approved projects at private non‑profit hospitals, and may subsidise patients unable to afford reasonable fees (s 7A).
• Regulatory framework. The Governor may make regulations to flesh out licensing fees, renewals, good management, registers, separation or removal of infectious patients, and prescribe penalties up to amounts specified (s 26O(1)-(2); s 37). The CEO may also issue guidelines for construction and maintenance, which may adopt standards by reference (s 26J).

These concepts interlock: licence conditions can specify maximum patient numbers, staffing categories and classes of patients (s 26D(3)); approval is required for building works (s 26K(c)); information directions can be retrospective (s 26S(6)); and enforcement includes fines, closure and SA Tribunal review (s 26F; s 26G; s 26H).

The Act affects the following parties in clear, actionable ways:

• Private hospital service providers and prospective licence applicants. Anyone (natural person, firm or body corporate) who desires to conduct a private hospital must apply for a licence and meet fitness, character, managerial and financial resource tests (s 26B). Licence holders are subject to conditions, annual renewals under regulations, non‑transferability (s 26D(2)-(3); s 26E(2)-(3)), and criminal penalties for breaches (s 26K; s 26L).
• Private psychiatric hostel operators. Part IIIB applies Part IIIA with modifications to private psychiatric hostels (s 26Q). That alters some requirements (e.g. s 26D(3)(a) is read as maximum residents and kinds/classes of residents, s 26DA does not apply to hostels) and allows regulations to prescribe returns and minimum pension remittances for residents (s 26Q(2)(a), (b), (d)(i)-(ii)).
• Patients, residents and their medical practitioners. Patients in private hospitals may be medically examined by a CEO‑authorised medical practitioner only where there has been a complaint to the CEO, and the patient’s treating medical practitioner must be notified and given an opportunity to be present; the licence holder must also be notified (s 10(1)-(2)). Patients detained for mental illness can only be received and detained where the hospital licence is endorsed under s 26DA (s 26DA(1)-(2)).
• Owners of premises proposed to be private hospitals. The CEO must be satisfied premises are suitable before granting approval; building, alteration or extension of private hospitals requires CEO approval unless the premises are an Aged Care Act‑certified nursing home (s 26C; s 26K(c)(i)-(ii)). Owners and licence holders bear the cost of remedial work ordered by the CEO and face closure for non‑compliance (s 26G).
• The Chief Psychiatrist and mental health system actors. The Chief Psychiatrist is statutorily required to recommend endorsements to the CEO for hospitals seeking to receive or detain involuntary patients under the Mental Health Act 2014; the CEO cannot endorse without that recommendation (s 26DA(3A)). Before cancelling an endorsement the CEO must consult the Chief Psychiatrist (s 26FA(2A)).
• The CEO (and Department) and the Minister. The CEO has broad operational decision‑making power,licensing, conditions, approvals, inspections, information directions and closure orders (s 26C; s 26D; s 10; s 26G; s 26S). The Minister controls general administration of the Act (s 5), may make payments with Treasurer approval in relation to non‑profit hospitals and subsidies (s 7A), and the Governor may make regulations (s 26O; s 37).
• The State and Parliament. The Governor (via appropriation) can make grants or subsidies to licensed private hospitals, subject to licence holder agreement to comply with regulations and CEO directions (s 26I). The Minister must carry out periodic reviews of the Act (s 38) and lay review reports before each House of Parliament (s 38(2)).

Who pays: licence applicants and holders bear compliance costs (premises upgrades, staffing levels, remedial works ordered by the CEO), fees prescribed by regulation (s 26O(2)(a)), and potential fines ($200, $1,000, $2,000, $5,000 depending on offence; see s 11; s 26L; s 26G(2); s 26DA(1); s 26K). The State may pay grants or subsidies (s 26I(1); s 7A) but only from parliamentary appropriation and tied to compliance (s 26I(2)).

Who decides: CEO and Department officers decide licensing, conditions, approvals and orders (s 26C; s 26D; s 26G; s 26S). The Chief Psychiatrist has a mandatory recommending role for endorsement to treat or detain under the Mental Health Act 2014 (s 26DA(3A)). The Minister controls administration and can approve payments with the Treasurer (s 5; s 7A). The Governor makes regulations (s 26O; s 37).

Duties and rights are concentrated around the licence holder, the CEO, and certain statutory actors.

Duties imposed on applicants and licence holders

• Application prerequisites and information. Applicants must apply in CEO‑approved forms (s 26N(1)), supply additional information if required and may have to verify information by statutory declaration (s 26N(2)). Applicants must demonstrate age (natural person), good character and reputation, sufficient material and financial resources, and understanding of duties and obligations (s 26B(2)-(4)).
• Premises, management and staffing standards. The CEO will not grant a licence unless satisfied premises are suitable and management, equipment and staffing arrangements are satisfactory (s 26C). Licence conditions may specify maximum patient numbers, classes of patients and staffing numbers and categories, and types and timing of nursing and other care to be provided (s 26D(3)(a)-(b)).
• Building approvals. A person must not build, alter or extend a private hospital unless approved by the CEO (s 26K(c)(i)), unless the facility is a nursing home certified under Part 2.6 of the Commonwealth Aged Care Act 1997 (s 26K(c)(ii)).
• Compliance with CEO orders and remedial work. If the CEO orders remedial building work, a licence holder must comply within the specified time or commit an offence (s 26G(1)-(2)). The CEO may close a hospital where orders are not complied with or where it is deemed unsafe, including immediate closure where necessity so requires (s 26G(3)-(4)).
• Information provision. A private hospital service provider must comply with a CEO direction to give specified information, which may include personal information, provided the information relates to hospital, health or psychiatric services and is consistent with the Act’s collection purposes (s 26S(1)-(5); s 26R).
• Licence conditions and renewal. Licence holders must observe licence terms and conditions; failure to comply is an offence (s 26L). Licences may be renewed annually in accordance with regulations (s 26E(2)).

Rights and procedural protections

• Appeal and review rights. A person aggrieved by refusal to grant a licence may appeal to the Minister within 30 days (s 26D(6)). Cancellation or non‑renewal of a licence, or cancellation of an endorsement under s 26DA, may be reviewed by the State Administrative Tribunal (s 26H(1)). Section 26F(2) and s 26FA(2) require the CEO to serve notice of intention to cancel and give a reasonable opportunity to be heard before cancellation.
• Interim arrangements pending review. Where the CEO has cancelled a licence or endorsement and the licence holder applies for review, the CEO may, pending determination, permit a person to conduct the hospital under terms and conditions he specifies (s 26H(3)). This provides a route for operational continuity while the review proceeds.
• Statutory immunities. Persons disclosing information in compliance with a direction under s 26S incur no civil or criminal liability and such disclosure is not regarded as breach of confidentiality, professional ethics or unprofessional conduct (s 26T). Persons acting in good faith in performance or purported performance of functions under the Act are protected from tort actions (s 35A(1)-(3)).
• Procedural limitations on inspections. Medical examination of a patient by an authorised medical practitioner can only be conducted on complaint to the CEO, and requires notice to the patient’s medical practitioner and the licence holder (s 10(1)-(2)). This creates procedural rights for treating practitioners and licence holders in relation to CEO‑authorised medical examinations.

Special duties around mental health

• Endorsement required for detaining persons under the Mental Health Act 2014. A licence must be endorsed to allow persons to be received and admitted to the hospital under the Mental Health Act 2014 and detained as involuntary patients (s 26DA(1)-(2)). The CEO cannot endorse without the Chief Psychiatrist’s recommendation (s 26DA(3A)). The CEO may impose conditions on endorsement and may cancel an endorsement if the hospital is no longer suitable or the licence holder has contravened the Mental Health Act 2014 or endorsement conditions (s 26DA(4); s 26FA(1)(a)-(b)).

Regulatory and financial constraints

• Grants and subsidy conditionality. Any grant or subsidy from the Governor requires the licence holder to agree to conduct in accordance with the regulations and to comply with CEO directions (s 26I(1)-(2)). The Minister may make targeted payments to religious or charitable organisations with Treasurer approval (s 7A).

Criminal and corporate liability

• Offences and officer liability. The Act prescribes offences with monetary penalties for various breaches (s 11; s 26DA(1); s 26G(2); s 26K; s 26L). Section 26M applies Criminal Code s 39 to specified offences listed in the Table, bringing officers of bodies corporate within criminal liability for those offences (s 26M and Table).

These duties and rights create a compliance ecology where licence holders must maintain premises, staffing and records to the CEO’s satisfaction, respond to CEO directions and orders, and may access review and interim continuation options. Financial assistance is available but conditional on compliance.

The Act employs a mixture of civil administrative measures (licence conditions, closure orders) and criminal penalties, with prosecution, fines and other enforcement levers. Enforcement modalities and penalties specified in the statute include:

Monetary penalties in the Act

• Obstruction of authorised officers: It is an offence to obstruct or wilfully mislead a person authorised under s 10 in the performance of duties; the penalty is $200 (s 11).
• Mental health endorsement breach: Conducting a private hospital in which any person is detained for treatment of mental illness without an endorsed licence is an offence punishable by $5,000 (s 26DA(1)).
• Failure to comply with remedial order: A licence holder who fails to comply with a CEO’s remedial order (s 26G(1)) within the specified time commits an offence with penalty $2,000 (s 26G(2)). The CEO may also close the hospital where the order is not complied with (s 26G(3)-(4)).
• Unlicensed operation and related offences: Section 26K makes it an offence to conduct or hold out as conducting a private hospital without a licence or approved premises, or to undertake building works without CEO approval. The penalty specified in s 26K is $5,000.
• Failure to comply with licence conditions: Contravention of a licence’s term or condition is an offence with a penalty of $1,000 (s 26L).
• Regulations may prescribe penalties up to $500 for breaches of regulations under s 26O(2)(e). Separately, s 37 allows regulations to impose penalties not exceeding $50 for regulatory breaches (s 37(3)(e)); this lower figure applies generally under s 37.

Administrative enforcement measures

• CEO powers to vary, revoke or cancel licences and conditions: The CEO may impose, revoke or vary licence terms and conditions (s 26D(2), (7)). If satisfied that the licence holder is not fit, premises unsuitable, or licence holder breaches the Act or conditions, the CEO may cancel or refuse to renew the licence (s 26F(1)(a)-(d)).
• Procedural safeguards before cancellation: Cancellation requires notice of intention and a summary of reasons served on the licence holder, and a reasonable opportunity to be heard before the licence is cancelled (s 26F(2); s 26FA(2) applies to endorsement cancellation).
• Emergency closure power: The CEO may order closure of a private hospital immediately where, in the CEO’s opinion, necessity requires it; the hospital must then remain closed until the CEO permits reopening in writing (s 26G(4)). This is a direct operational enforcement tool that does not require prior criminal proceedings (s 26G(3)).
• Interim operational permission pending review: If a licence or endorsement is cancelled and the holder applies for review to the State Administrative Tribunal, the CEO may, pending determination, permit a person to conduct the hospital under specified terms and conditions (s 26H(3)). This allows the CEO to impose interim conditions during the review period.

Criminal officer liability

• Application of Criminal Code s 39. Section 26M applies Criminal Code s 39 to specified offences in the Act (the Table lists s 26DA(1), s 26G(2), s 26K and s 26L). This makes officers of bodies corporate potentially criminally liable for corporate breaches of those offences, subject to the Criminal Code provisions (s 26M).

Enforcement incentives and consequences

• Administrative discretion with criminal penalties. The CEO holds wide administrative discretion to grant and condition licences and to order closures, with criminal penalties available for serious non‑compliance (s 26D; s 26G; s 26K). The range of penalties creates potential financial exposure for licence holders and their officers.
• Regulatory fines limited but closure powerful. Smaller regulatory fines may be imposed under regulations, but the CEO’s power to order remedial work and immediate closure (s 26G(4)) is operationally significant and may have immediate commercial consequences.
• Immunities for disclosure and official acts. Section 26T immunises providers from civil or criminal liability for disclosures to the CEO in compliance with directions, removing a legal barrier to compliance with information orders. Section 35A gives tort protection to persons acting in good faith under the Act, reducing liability risk for authorised officers.

Procedural and judicial review

• Right to appeal Ministerial refusal within 30 days (s 26D(6)) and right to apply to the State Administrative Tribunal for review of cancellation or non‑renewal of a licence or cancellation of an endorsement (s 26H(1)). The Tribunal’s role is the statutory review channel; compilation notes reference conferral of jurisdiction by the State Administrative Tribunal Act 2004 (notes to s 26H and compilation table).

Overall, enforcement under the Act mixes statutory criminal penalties with administrative powers that can be exercised rapidly (order remedial work, close premises) and subject to subsequent procedural review. Licence holders and corporate officers are directly exposed under both administrative and criminal sanctions specified in the Act.

The Act deliberately imports, defers to, and conditions a number of other Commonwealth and State laws. The text contains explicit cross‑references, and operational interactions arise in practice.

Key statutory cross‑references in the Act

• Health Services Act 2016. Definitions of "health service" and "hospital" are taken from the Health Services Act 2016 (s 2(1)), and the Act distinguishes private from public hospitals by reference to the Health Services Act 2016 s 8(6)-(8) (s 2(1)). This means classification of a hospital as public or private flows from the Health Services Act 2016 definitions and declarations; the Act’s application and many constraints depend on that classification (s 3; s 4).
• Mental Health Act 2014. The Act defers in part to the Mental Health Act 2014 where private hospitals or parts of them are authorised hospitals under that Act (s 4). Section 26DA explicitly ties the endorsement to receive and detain persons as involuntary patients to the Mental Health Act 2014 process, and requires the Chief Psychiatrist’s recommendation for endorsement (s 26DA(2)-(3A)). Cancellation of endorsement requires consultation with the Chief Psychiatrist (s 26FA(2A)).
• Health Legislation Administration Act 1984. The Act imports the meaning of CEO from the Health Legislation Administration Act 1984 (s 2(1)). The identity, powers and responsibilities of the CEO under this Act therefore interact with the administrative structures from that statute.
• Health Practitioner Regulation National Law (WA). The definition of "medical practitioner" is given by reference to that national law as applied in Western Australia (s 2(1)). That affects who may be an authorised medical practitioner under s 10 and who may perform medical examinations.
• Aged Care Act 1997 (Commonwealth). The Act creates exemptions for premises that are nursing homes where the conduct or management is a certified residential care service under Part 2.6 of the Aged Care Act 1997: such nursing homes are treated as an exception to licence/approval requirements in s 26K(a)(ii), (b)(ii), (c)(ii).
• Criminal Code. Section 26M applies Criminal Code s 39 (the provision concerning liability of officers of a body corporate) to specified offences under this Act, making officers criminally liable in appropriate circumstances.
• State Administrative Tribunal Act 2004 and related regulations. Section 26H gives the State Administrative Tribunal jurisdiction to review licence cancellation or non‑renewal decisions; compilation notes reference the conferral of jurisdiction and transitional provisions relating to the Tribunal (compilation notes).

Operational interactions and consequences

• Classification dependency. Because the Act defines private hospital by reference to the Health Services Act 2016, any declaration under that Act changing a hospital’s public or private status will determine whether this Act applies. The Act also allows the Minister to declare institutions not to be nursing homes for purposes of this Act (s 3(3)), creating a small direct interaction with the nursing home category.
• Aged care certification as an alternative regulatory pathway. Nursing homes certified under the Commonwealth Aged Care Act 1997 can operate without the licence and physical approval requirements of this Act for certain activities (s 26K(a)(ii), (b)(ii), (c)(ii)). That means operators in the aged care sector may face a different regulatory overlay and may be exempted from the State licensing regime in specified ways.
• Mental health regulatory layering. To receive and detain involuntary patients, facility operators must satisfy both this Act’s endorsement process and the Mental Health Act 2014’s requirements. The Chief Psychiatrist’s mandatory recommending role (s 26DA(3A)) creates an institutional check and ensures that clinical mental health governance intersects directly with licensing.
• Data and privacy overlay. The CEO’s power to direct disclosure of personal information (s 26S), combined with statutory immunity for disclosures made in compliance with those directions (s 26T), modifies ordinary confidentiality and privacy constraints that may arise under other laws or professional standards. However, s 26S(3) requires the CEO to be satisfied that collection is consistent with the purposes in s 26R (regulation and health‑related research), so the Act imposes a purpose test.
• Criminal and corporate liability across statutes. Applying Criminal Code s 39 to offences makes corporate officers liable for contraventions of this Act as they would be under general criminal law; this links corporate governance duties under corporate and criminal statutes with the operational duties under this Act (s 26M).

Regulatory design choices

• Delegation to CEO within a statutory framework. The Act embeds significant discretion in the CEO (licensing, conditions, closure, information directions) while preserving Ministerial control over general administration (s 5) and Parliamentary appropriation for grants (s 26I(1)). This creates an administrative interplay where other statutes define key institutional roles and powers applied under this Act.
• Interplay with Commonwealth standards. The Act explicitly allows the CEO to adopt standards by reference to Standards Australia, the British Standards Institution or other bodies (s 26J(2)(b)), and provides for exemption where Commonwealth certification exists (s 26K). That creates potential harmonisation but also possible duplication if federal and state rules differ.

In sum, operational compliance requires attention to cross‑statutory classification (Health Services Act 2016), mental health endorsement processes (Mental Health Act 2014 and Chief Psychiatrist), Aged Care Act 1997 certification exceptions, Criminal Code officer liability, and the CEO’s information directions which alter ordinary confidentiality obligations.

The Act has a longue durée history with multiple amendments reflected in the compilation table and embedded section notes. Key mechanical amendments and insertions recorded in the statute text and compilation notes include:

• Original enactment and titles. The Act was originally the Hospitals Act 1927. The short title has changed over time, reflected in the compilation notes (note 3). The modern short title as inserted is the Private Hospitals and Health Services Act 1927 (s 1 note).
• Part IIIA (Private hospitals) insertion, 1985. The provisions currently in Part IIIA (s 26A onwards) were inserted by Acts Amendment (Hospitals) Act 1985, Pt III. Each inserted section records its origin; for example, s 26A was inserted by No. 53 of 1985 s 22 (heading and insertion notes in the Act).
• Mental health related measures, 1996. Section 26DA (endorsement required to conduct private hospitals that detain persons for treatment of mental illness) and related provisions were inserted by the Mental Health (Consequential Provisions) Act 1996 (s 26DA inserted: No. 69 of 1996 s 44). Section 26FA (cancelling endorsement) also records insertion by No. 69 of 1996 s 45.
• Information powers and protections, 2004 and later. Part IIIC (Information) provisions such as s 26R and s 26S were inserted by the Health Legislation Amendment Act 2004 (No. 61 of 2004) and later amended (s 26R inserted: No. 61 of 2004 s 14; s 26S inserted: No. 61 of 2004 s 14). Section 26T (no liability for disclosure) was inserted by No. 11 of 2016 s 276.
• Renaming and structural updates, 2016. Several modernising amendments and renamings occurred in the period around the Health Services Act 2016 (No. 11 of 2016), including reclassification of headings and insertion of Part IIIC (s 26R onwards) and s 35A (protection from personal liability) (see insertion notes in the Act).
• Recent officer liability reform, 2023. Section 26M (liability of officers for offence by body corporate) was inserted by the Directors’ Liability Reform Act 2023 (No. 9 of 2023 s 120), applying Criminal Code s 39 to specified offences listed in the Act’s Table.
• Compilation table detail. The compilation table in the Act lists many amending Acts with dates and commencement information, documenting successive legislative changes from 1927 through major modern amendments (e.g. 1985 Act, 1996 Mental Health changes, 2004 Health Legislation Amendment Act, 2016 Health Services Act, 2023 Directors’ Liability Reform Act). The table records numerous intermediate amendments and repeals, and separate notes deal with transitional provisions for the State Administrative Tribunal and machinery of government changes.

What the amendment notes convey about statutory intent

• Progressive operationalisation. The pattern of amendments demonstrates a progressive layering of regulatory detail: initial establishment of hospitals regulation, later introduction of formal licensing and approval (1985), incorporation of mental health safeguards and the Chief Psychiatrist’s role (1996), expansion of information‑collection powers (2004), and recent alignment of officer liability with wider directors’ liability reform (2023).
• Movement towards administrative centralisation. Recurrent amendments delegate substantial operational authority to the CEO and the Department (licensing, inspections, information directions), while preserving Ministerial and gubernatorial roles for grants and regulations. The insertion of statutory immunities (s 26T; s 35A) reflects an intent to remove legal barriers to reporting and to protect official decision‑making done in good faith.

For practitioners reviewing compliance or historical obligations, the compilation table and section insertion notes within the statute are the primary source for the progression of amendments. The Act’s present form is the result of multiple legislative steps that increasingly reinforced licensing, mental health endorsements, information powers and officer liability.

The statutory text and compilation notes do not cite or record judicial decisions. No cases are named in the Act itself. The statute does provide administrative and judicial review routes, and those are the relevant mechanisms to challenge administrative action under the Act.

Statutory review and tribunal jurisdiction

• State Administrative Tribunal. Section 26H gives persons aggrieved by cancellation or non‑renewal of a licence, or cancellation of an endorsement, the right to apply to the State Administrative Tribunal for review (s 26H(1)). The compilation notes reference statutory conferral of jurisdiction and transitional provisions regarding the Tribunal (compilation notes and notes to s 26H); these legislative notes indicate that the Tribunal is the intended review forum for licence decisions under this Act.
• Ministerial appeal. A person aggrieved by the CEO refusing to grant a licence has an internal statutory appeal to the Minister within 30 days (s 26D(6)), providing an administrative ladder before external review.

Absence of case citations in the statute

• The Act does not include any schedule of judicial decisions or refer to leading cases. The text does not record any precedent or litigation history. Accordingly, to determine how courts or tribunals have interpreted ambiguous provisions,such as the scope of CEO discretion, the adequacy of procedural fairness before cancellation, the application of Criminal Code s 39 to corporate officers under s 26M, or the interaction with Commonwealth Aged Care certification,research to identify tribunal and court decisions post‑enactment will be required outside of the Act text.

Practical implications for litigators and advisers

• Expect administrative law litigation focus. Challenges are likely to be framed in administrative law terms: procedural fairness in s 26F(2) cancellation notices, the standard of "satisfaction" the CEO must reach under s 26C and s 26D, whether the CEO properly exercised emergency closure powers (s 26G(4)), or whether an information direction under s 26S is lawful and proportionate to the statutory purpose (s 26R).
• Tribunal practice. Because s 26H directs disputes to the State Administrative Tribunal, practitioners should look to Tribunal practice and decisions under the Tribunal Act for procedural and substantive precedent on the exercise of licensing and cancellation powers. Compilation notes show the Tribunal’s jurisdictional framework has been considered in prior transitional legislation (see compilation notes).
• Criminal prosecutions and corporate officer liability. Prosecutions under s 26K, s 26L, s 26G(2) and s 26DA(1) can raise questions about the application of Criminal Code s 39 to officers; the 2023 insertion of s 26M formalises that potential liability, but the Act itself does not record any litigated applications. Advisers should consider the nexus between corporate governance obligations and the Criminal Code.

Because the Act contains its own review pathways but records no cases, anyone needing to assess interpretative or doctrinal questions must search tribunal and court decisions external to the statute to see how the CEO’s powers, the Chief Psychiatrist’s recommendation role, and information‑disclosure protections have been applied in practice.

The Act contains several provisions that can create operational traps or non‑obvious compliance costs for operators, owners and advisers. These are concrete mechanisms to watch for.

Non‑transferability of licences and business transactions

• Licences are not transferable (s 26E(3)). Sale of a hospital business without recognising that the licence cannot be assigned will create an operational gap: the purchaser cannot automatically step into the licence, and continuing operation without a new licence risks exposure to s 26K offences ($5,000 penalty). Transactions will therefore usually require coordination with the CEO to secure a new licence for the transferee, or use of the Aged Care Act 1997 certification exceptions where applicable (s 26K).

CEO discretion and variable timeframes

• Variable decision timeframes. The CEO is required to notify licence decisions faster where premises are already approved (30 days) than where premises are not approved (3 months) (s 26D(5)(a)-(b)). Applicants drafting project timelines must plan for the longer 3‑month window where premises lack prior approval.
• Broad discretion to set licence conditions. The CEO may impose “such terms and conditions as he thinks fit” (s 26D(2)). Conditions can include precise staffing numbers, categories and timing (s 26D(3)(b)). This degree of discretion can make licence conditions highly prescriptive; applicants should anticipate potentially bespoke requirements.

Immediate closure power and criminal offence for non‑compliance

• Closure without criminal proceedings. The CEO may order closure of a private hospital if remedial orders are not complied with, and may close immediately where necessity requires it (s 26G(3)-(4)). Closure can occur irrespective of whether criminal proceedings for the underlying offence have been commenced or completed (s 26G(3)). This gives the CEO a de facto operational shut‑off switch which can have immediate commercial consequences.
• Remedial order offence tied to closure. Failure to comply with remedial orders is itself an offence with penalty ($2,000) (s 26G(2)). An operator should prioritize compliance with remedial orders to avoid both fine and closure risk.

Information directions and retrospective application

• Compelled disclosure, including historical records. The CEO may direct providers to give information obtained even before commencement of the Part (s 26S(6)). The direction may be retrospective, which can impose retrieval or record‑keeping burdens for historical data. The CEO can also target directions to named providers, classes or all providers (s 26S(7)).
• Statutory indemnity for disclosure. Disclosures in compliance are protected from civil and criminal liability and are not to be regarded as breaches of professional duties (s 26T). While this removes a legal disincentive to comply, it also limits operators’ ability to refuse disclosure on confidentiality grounds, even where common law or professional standards would otherwise be raised.

Mental health endorsement dependency and Chief Psychiatrist role

• Mandatory Chief Psychiatrist recommendation. The CEO cannot endorse a licence to detain under the Mental Health Act without the Chief Psychiatrist’s recommendation (s 26DA(3A)). Operators must therefore engage clinical mental health governance processes and may face an additional approval hurdle beyond the CEO’s licensing test.
• Separate endorsement cancellation process. Endorsement cancellation requires consultation with the Chief Psychiatrist (s 26FA(2A)). While this provides a clinical check, it also creates a two‑step governance process for endorsement decisions.

Aged Care exceptions may be narrower than expected

• Aged Care Act carveouts are narrowly framed. The Act exempts nursing homes from certain licensing and approval requirements only where the conduct or management of the nursing home is a residential care service certified under Part 2.6 of the Commonwealth Aged Care Act 1997 (s 26K(a)(ii), (b)(ii), (c)(ii)). Operators cannot assume broad equivalence; they must verify certification under the Commonwealth Act to rely on these exceptions.

Officer liability for corporate offences

• Corporate officer criminal exposure. Section 26M applies Criminal Code s 39 to certain offences under the Act, meaning officers can be criminally liable for breaches committed by the corporation (s 26M and Table). Directors and senior managers must be aware of personal exposure for the listed offences (s 26DA(1), s 26G(2), s 26K, s 26L).

Licence application formalities

• CEO‑approved forms and statutory declarations. Applications must be in CEO‑approved form (s 26N(1)). The CEO may require additional information and verification by statutory declaration (s 26N(2)). Failure to complete the required formalities can delay or invalidate applications.

Grants and conditionality

• Grants subject to CEO directions. Any grants or subsidies under s 26I are only payable where the licence holder agrees to conduct the hospital in accordance with the regulations and CEO directions (s 26I(2)). Acceptance of State funds therefore imports additional compliance obligations.

Regulatory penalties are limited but practical consequences are significant

• Low maximum regulatory fines, but potentially severe operational impact. While regulations under s 26O and s 37 can impose modest fines (up to $500 and $50 respectively), the CEO’s remedial and closure powers and the criminal penalties in the Act ($1,000-$5,000) create practical consequences that exceed regulatory fines. Compliance strategies must therefore focus on operational readiness, not only on avoiding minor regulatory penalties.

In short, the main operational "gotchas" are licence non‑transferability, CEO discretion and immediate closure powers, retrospective information directions with immunity for disclosure, the Chief Psychiatrist’s mandatory recommending role for mental health endorsement, and officer criminal liability for specified offences. Each of these imposes real procedural and financial burdens that need active management.

Compliance under this Act requires operational, administrative and governance steps mapped to the statutory duties. Below is a practical compliance checklist tied to the Act’s provisions.

1. Establish whether the facility falls within the Act

• Confirm whether the hospital qualifies as a private hospital or private psychiatric hostel by reference to the Health Services Act 2016 definitions (s 2(1); s 3).
• If the facility is an Aged Care Act certified nursing home, determine whether the Aged Care Act certification affords an exemption from the State licence/approval requirements per s 26K(a)(ii), (b)(ii), (c)(ii).

2. Prepare the licence application and supporting evidence

• Use CEO‑approved forms for the application (s 26N(1)). Anticipate and be ready to provide additional supporting information; the CEO may require statutory declarations to verify information (s 26N(2)).
• For natural persons: document age (18+), character/reputation, fitness to conduct a private hospital, and financial/material resources (s 26B(2)(a)-(c)).
• For firms and bodies corporate: prepare evidence of fitness and reputation for all relevant natural persons concerned in management, evidence of financial resources, and identify at least one person who understands the duties and obligations (s 26B(3)-(4)).

3. Ensure premises and arrangements meet CEO expectations

• Obtain pre‑approval feedback or assurance from the CEO on premises suitability, management, equipment and staffing before finalising transactions (s 26C; s 26D(1)). If premises are not yet approved, plan for the longer 3‑month decision window (s 26D(5)(a)).
• Implement staffing levels and care models that can meet potential licence conditions: the CEO may specify maximum patient numbers, resident classes, categories and numbers of nursing and other staff, and the kinds and timing of care (s 26D(3)).

4. Plan building, alteration and extension work to secure CEO approval

• Do not commence building, alteration, or extension work without CEO approval (s 26K(c)(i)), unless the operation is covered by the Aged Care Act certification exception (s 26K(c)(ii)).
• Consider engaging early with the CEO and issuing guidelines (s 26J) to verify standards and reference materials to be met.

5. If providing or intending to provide psychiatric detention, secure endorsement

• To receive or detain persons under the Mental Health Act 2014, apply for endorsement under s 26DA. The CEO cannot endorse unless the Chief Psychiatrist recommends it (s 26DA(2)-(3A)). Prepare clinical governance documentation and engagement with the Chief Psychiatrist as part of the application.

6. Implement operational recordkeeping and data systems

• Anticipate CEO directions to provide information, including personal information, and be prepared to supply data in the specified format (s 26S(1), (4)). Because directions can be retrospective (s 26S(6)), maintain historical records accessible for retrieval.
• Ensure information flows are reconciled with privacy obligations, but note statutory indemnity for disclosures made in compliance with s 26S (s 26T). Despite indemnity, consider internal data governance and minimal disclosure principles to match the statutory purpose test in s 26S(3).

7. Maintain compliance with licence conditions and CEO orders

• Monitor licence conditions actively; s 26L makes failing to comply with licence terms a criminal offence with a $1,000 penalty. Establish an internal compliance register mapping each licence condition to responsible staff and reporting timelines.
• If the CEO issues remedial orders under s 26G, comply within the specified time to avoid the s 26G(2) offence ($2,000) and risk of closure (s 26G(3)-(4)).

8. Prepare for inspection and medical examinations

• Familiarise staff with s 10: authorised persons may inspect any part of the hospital and, if a medical practitioner, may medically examine a patient only on complaint to the CEO and with notice given to the patient’s medical practitioner and the licence holder (s 10(1)-(2)). Put procedures in place to ensure timely notifications and presence arrangements during authorised examinations.

9. Governance and corporate risk management

• Ensure that directors and officers understand the criminal exposure created by s 26M applying Criminal Code s 39 to specified offences. Implement board reporting and controls to mitigate the risk of offences listed in the Act (s 26M and Table).
• Maintain adequate insurance and legal advice, noting that statutory immunities (s 26T; s 35A) do not eliminate all commercial or regulatory risk.

10. Financial and funding considerations

• If seeking State grants or subsidies, secure licence first and be prepared to agree to conduct the hospital according to the regulations and CEO directions (s 26I(1)-(2)). Coordinate with the Minister and Treasurer where s 7A payments to religious or charitable organisations are sought.
• Budget for licence application fees, renewals and potential capital remediation costs. The regulations may prescribe fees for application and renewal and approval of premises (s 26O(2)(a)).

11. Regulatory monitoring and renewal

• Track annual renewal cycles under the regulations (s 26E(2)). Maintain compliance documentation to support renewals and to be in a position to respond to the CEO’s satisfaction tests at renewal.
• Monitor changes to regulations under s 26O and s 37 and updates to CEO guidelines under s 26J. Regulations may prescribe conduct standards, registers, separation of infectious patients and impose modest penalties (s 26O(2)(b)-(e)).

12. Dispute and review readiness

• If faced with a refusal, cancellation or non‑renewal, note internal appeal to the Minister within 30 days (s 26D(6)) and the right to apply to the State Administrative Tribunal for review (s 26H(1)). Prepare evidence and timelines for Tribunal review and consider interim operational arrangements under s 26H(3) if the CEO permits a person to conduct the hospital pending review.

Practical checklist summary

• Confirm classification under Health Services Act 2016.
• Prepare CEO‑approved application with statutory declarations where required.
• Secure CEO approval for premises and any building works before commencement.
• Implement staffing and clinical governance consistent with potential licence conditions.
• For mental health services, engage the Chief Psychiatrist early for endorsement.
• Maintain accessible records for retrospective data requests; implement data governance aligning with statutory purpose.
• Comply promptly with CEO remedial orders to avoid closure and fines.
• Train staff to handle inspections and notifications under s 10.
• Monitor regulatory changes and renew licence annually.
• Institute corporate controls to manage officer liability risks under s 26M.

Following these steps will align operational practices with the principal legal obligations in the Act: licence, premises approval, CEO directions and remedial orders, information provision, endorsement processes for mental health detention, and renewal obligations.