Lawsuit targets councils on rates

A NOT-for-profit aged care provider has taken four Tasmanian councils to the Supreme Court to argue retirement villages should be exempt from council rates.

Lawyers for Southern Cross Care and the Hobart, Clarence, Kingborough and Meander Valley councils appeared before the Full Court in Hobart yesterday.

The councils have decided to charge general rates on notfor-profit organisations that run retirement villages.

Barrister for Clarence City and Meander Valley councils, Shaun McElwaine, SC, said residents of retirement villages were different from nursing home residents.

“We’re not rating nursing homes, we’re not rating aged care facilities,” Mr McElwaine said.

“We accept that a nursing home is owned and occupied by the nursing home proprietor.”

But the councils are arguing retirement village residents should pay rates because they live in self-contained units where they care for themselves and which they regard as their private home.

“Private residence is not an exclusive charitable purpose,” Mr McElwaine said.

Southern Cross Care barrister Bret Walker, SC, said the purpose of the charity was providing a residence indefinitely to the aged.

“The residents aren’t charities, they are the object of charities,” Mr Walker said.

The Full Court has reserved its decision.

Outside the court, Southern Cross Care chief executive Richard Sadek and former chairman Ray Groom said the case was a test case for all aged care providers in the state and a rates exemption for retirement villages could be worth $14 million for operators collectively.

In 2016 the Local Government Association of Tasmania decided councils should take a “common and equitable” approach to rating independent living units, saying that although the units may be owned by charities, their use as private residences was not a “charitable purpose”.