38Increases in maintenance charges

38 Increases in maintenance charges (1) In this section— S. 38(1) def. of *adjusted maintenance charge* amended by No. 23/2016 s. 30(1). ***adjusted maintenance charge*** means the adjusted maintenance charge determined and indexed in accordance with section 38AA; S. 38(1) def. of *maintenance charge* repealed by No. 4/2005 s. 15. ***special levy*** means a payment which is made by a resident to the owner or manager and which is not— (a) a maintenance charge; or (b) a payment made in consideration of residence in the village. (2) Despite anything to the contrary in a residence contract, a management contract or the by-laws a resident is not required to pay a maintenance charge to the extent to which it is greater than the adjusted maintenance charge. (3) A manager is not liable in any civil action for breach of contract in respect of the manager's failure to provide goods and services to residents if— (a) to cover the cost of the provision of the goods and services it would be necessary to levy a maintenance charge greater than the adjusted maintenance charge; and (b) in all the circumstances the manager acted reasonably; and (c) the residents have not approved the payment of a maintenance charge greater than the adjusted maintenance charge. (4) Subsection (2) does not apply if the payment of a maintenance charge that is greater than the adjusted maintenance charge has been approved by resolution of a majority of the residents at a meeting of the residents or is approved by resolution of the residents committee. (5) Subsection (2) does not apply to the payment of a maintenance charge which is greater than the adjusted maintenance charge to the extent to which the greater amount represents— (a) rates, taxes or charges in respect of retirement village land or the use of a retirement village land levied under an Act or subordinate instrument; or (b) salaries or wages paid in accordance with an award made by a Commission, Tribunal, Board or other body under— (i) an Act other than this Act; or (ii) a Commonwealth Act— if the salaries or wages are paid to a manager or a person employed in connexion with the retirement village. (6) Despite anything to the contrary in a residence contract, a management contract or the by-laws, a resident is not required to pay a special levy unless— (a) the residents have not been required to pay a special levy for the past 12 months; and (b) the special levy has become payable in one of the following ways— (i) the owner or residents must make the expenditure which the levy is intended to cover because of the requirements of an Act, a subordinate instrument or the order of a court; S. 38(6)(b)(ii) amended by No. 23/2016 s. 30(2). (ii) the residents have authorized the making of the special levy by special resolution passed at a meeting of the residents; (iii) the residence contract, the management contract or the by-laws provided that the residents are responsible for the expenditure or the class of expenditure which the special levy is intended to cover. S. 38AA inserted by No. 23/2016 s. 31. 38AA Formula for calculation of adjusted maintenance charge (1) The adjusted maintenance charge for a relevant financial year for an existing retirement village or a new retirement village that has been in operation for at least one relevant financial year must be determined in accordance with subsection (2). (2) For the purposes of subsection (1), the adjusted maintenance charge must be determined for each relevant financial year for the retirement village in accordance with the formula— ![]() where— **A** is— (i) subject to subparagraph (ii), the adjusted maintenance charge for the previous relevant financial year for the village; or (ii) in the case of a new retirement village that has been in operation for only one relevant financial year, the maintenance charge for that relevant financial year for the village; **B** is the sum of the consumer price index numbers for each of the reference periods ending in the previous relevant financial year for the village; **C** is the sum of the consumer price index numbers for each of the reference periods ending in the relevant financial year immediately preceding the previous relevant financial year for the village. (3) The amount obtained by the application of the formula set out in subsection (2) may be rounded to the nearest multiple of 10 cents. ***consumer price index*** means the all groups consumer price index for Melbourne in original terms published by the Australian Bureau of Statistics; ***relevant financial year*** means, in respect of a retirement village, a period that consists of 12 consecutive months commencing on the date fixed by the manager of the retirement village. S. 38A inserted by No. 4/2005 s. 16.