BELLARA AGED CARE VILLAGE PTY LTD v LINDA KNOCK [2025] SASC 10

Applicant: BELLARA AGED CARE VILLAGE PTY LTD Counsel: MR M SPENCER - Solicitor: O’LOUGHLINS LAWYERS 19th Respondent: LINDA KNOCK Counsel: MR B JAMES - Solicitor: JONES HARLEY TOOLE Interested Party: MINISTER FOR HEALTH AND WELLBEING Counsel: MR S RANIERI - Solicitor: CROWN SOLICITOR (SA) Hearing Date/s: 02/07/2024, 12/07/2024 File No/s: CIV-22-000951 B SUPREME COURT OF SOUTH AUSTRALIA (Civil: Application) DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment. The onus remains on any person using material in the judgment to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court in which it was generated. BELLARA AGED CARE VILLAGE PTY LTD v SERAFINI & ORS (No 2) [2025] SASC 10 Judgment of the Honourable Justice McIntyre 10 February 2025 REAL PROPERTY – RETIREMENT VILLAGES PROCEDURE - CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS - COSTS - GENERAL RULE: COSTS FOLLOW EVENT - GENERAL PRINCIPLES AND EXERCISE OF DISCRETION The applicant (‘Bellara’) seeks leave to discontinue the proceedings initiated under s 58 of the Retirement Villages Act 2016 (SA) (‘the Act’), where Bellara proposed to excise a portion of its retirement village scheme for a new commercial development. The decision to discontinue was prompted by changed commercial conditions that rendered the proposed development no longer viable. The 19th respondent contends that discontinuance should not result in injustice or prejudice. She argues that, in addition to Bellara paying her costs, appropriate ancillary orders are necessary to safeguard her interests. Specifically, she seeks orders preventing the applicant from initiating any s 58 application for partial termination on the same or similar grounds, as well as measures to rectify what she contends is the deterioration of the area that was proposed to be excised from the village and to ensure that residents are not burdened with any incidental costs arising from the proceedings and subsequent discontinuance. Bellara contends that, given the altered commercial landscape, it is appropriate to grant leave to discontinue the proceedings without imposing any substantive ancillary orders that would restrict its statutory rights under the Act. Bellara argues that the discontinuance should simply bring the litigation to an end without requiring orders for reinstatement of the subject matter or for preventing future applications, as such orders would exceed the proper scope of UCR r 141.4. HELD: 1. Leave to discontinue the proceedings as against the 19th respondent subject to the payment of her costs and subject to an order preventing the applicant bringing a similar application -- 1 of 9 -- under s 58 for partial termination of the Scheme for a period of 24 months without leave of the court. 2. The further ancillary orders sought by the 19th respondent requiring the applicant to reinstate the subject matter of the application or to prevent the allocation of any incidental costs to the residents are not granted, as they constitute substantive relief beyond the scope of UCR 141.4. Retirement Villages Act 2016 (SA) s 58; Uniform Civil Rules 2020 (SA) rr 141.3, 141.4, referred to. Shojaei v Disney [2014] SADC 109; Kennedy & Hunt v Griffiths & Griffiths [2014] QSC 43; Keyton Holdings Pty Ltd [2024] SASC 66, considered. -- 2 of 9 -- BELLARA AGED CARE VILLAGE PTY LTD v SERAFINI & ORS (No 2) [2025] SASC 10 Civil: Application BELLARA AGED CARE VILLAGE PTY LTD v SERAFINI & Ors (No 2) Civil: Application 1 The applicant, Bellara Aged Care Village Pty Ltd (‘Bellara’) operates a retirement village scheme (‘the Scheme’). Bellara issued an application under s 58 of the Retirement Villages Act 2016 (SA) (‘the Act’) seeking to excise a portion of land from the Scheme to enable a new development to be built on the northern part of the village. A number of village residents objected to the application. One, the 19th respondent, actively participated in the proceedings. The others did not. The Minister for Health and Wellbeing (‘the Minister’) is an interested party to these proceedings under s 58(2) of the Act. The application 2 Bellara issued an interlocutory application on 1 November 20241 seeking leave to discontinue these proceedings. The residents who did not take an active role in the proceedings (‘the remaining residents’) were contacted by the Retirement Village Unit of the Office for Aging Well at the direction of the Minister to ascertain their views about that application. The details of that consultation process are contained in an affidavit of Ms Clarke affirmed on 8 January 2025.2 The remaining residents do not oppose the application for leave to discontinue and have incurred no costs in the proceedings. Orders were therefore made on 29 January 2025 permitting the applicant to discontinue against those respondents with no order as to costs.3 3 The Minister does not oppose the applicant being granted leave to discontinue as against him as the interested party but must remain in the proceedings until issues as between the applicant and the 19th respondent have been determined. 4 The 19th respondent accepts that the Court should be slow to force a party to continue in an action where it has indicated an intention to withdraw but submits that leave can and should only be granted provided there are appropriate and sufficient ancillary orders. The Uniform Civil Rules 5 Discontinuance is governed by Chapter 12 of the Uniform Civil Rules 2020 (SA) (“UCR”), which deals with early finalisation. This matter was listed for trial 1 FDN 117. 2 FDN 124. 3 FDN 131. -- 3 of 9 -- [2025] SASC 10 McIntyre J 2 in March 2024 but adjourned owing to a change in position by the applicant. Accordingly, the applicant is required to obtain leave to discontinue. Discontinuance with leave is governed by UCR r 141.4 which provides as follows:4 141.4—Discontinuance with leave (1) An applicant may seek leave to discontinue an action on terms as to costs or otherwise by filing an interlocutory application and supporting affidavit in accordance with rule 102.1. (2) The Court may, on application under subrule (1)— (a) refuse leave if it considers that the prejudice that will be caused by discontinuance to an objecting party justifies the refusal of leave and, unless the applicant undertakes to prosecute the action diligently, dismiss the action; (b) grant leave on terms including as to costs; or (c) make such other or further order as it thinks fit. (3) If a Court grants leave to discontinue, any notice of discontinuance must be filed within 14 days after the grant of leave. 6 Relevantly the Court may grant leave on terms including as to costs and may make such further or other order as it thinks fit. The discretion is broad. UCR r 141.4 is a new rule which does not have an equivalent in the previous Supreme Court Rules. There appears to have been no prior consideration of the extent of the discretion. Clearly, however, the discretion must be considered in the context that the rule is designed to facilitate early finalisation of matters and also in the context of the nature of the originating process sought to be discontinued. The competing positions 7 The 19th respondent says that the exercise of the Court’s discretion requires, as an overriding consideration, that the grant of leave to discontinue does not occasion injustice to the other party. It is further contended that the preservation of an advantage is a relevant consideration and that, if there is to be any disadvantage, it should fall upon the party seeking to discontinue. I accept these propositions in general terms however, whilst the power to make ancillary orders when granting leave to discontinue is predicated upon the need to guard against injustice, it will not always be possible to avoid all prejudice or disadvantage to the other party. 8 The usual course is to remedy any prejudice by appropriate orders as to costs. The 19th respondent however says that costs alone will not be sufficient to remedy the prejudice that she has suffered. Her position as to ancillary orders is set out as follows in her written submissions:5 4 Uniform Civil Rules 2020 (SA) (‘UCR’) r 141.3. 5 FDN 127 at [35]. -- 4 of 9 -- [2025] SASC 10 McIntyre J 3 If leave is granted to the applicant to discontinue the proceedings, the 19th respondent seeks the following ancillary orders – a. The applicant pay the 19th respondent’s costs b. The applicant be ordered to not commence or pursue similar proceedings in relation to the same subject matter or otherwise provide an equivalent undertaking. c. The applicant be ordered to reinstate the subject matter of the application, being the northern side of the Village, to the same or similar condition as it was in prior to the application. d. The applicant be ordered to ensure any costs of and incidental to the application (including costs arising due to the destruction and/or neglect of the northern side), are not attributed to the residents through fees or other claims. And to the extent such costs have already been attributed to the residents, such costs are refunded to the residents. 9 The applicant and the 19th respondent have reached an agreement as to the question of costs should the applicant be granted leave to discontinue. The applicant opposes the remaining orders, contending that they amount to substantive relief and that UCR r 141 is not a vehicle for orders for substantive relief. The applicant accepts that the Court has a discretion under UCR r 141.4(2) but says that this must be exercised on a principled basis where the ordinary requirements of procedural fairness and evidence are complied with. It is said that there is no evidence that might justify the orders sought by the 19th respondent and that, moreover, the 19th respondent has alternative remedies available to her under the Act. 10 I will deal with each order sought in turn. Restriction on further applications 11 The 19th respondent submits that it is common for the Court, in considering the granting of leave for an application to discontinue, to impose by way of order, or undertaking, that the discontinuing party not be entitled to commence or undertake proceedings of the same or similar nature regarding the same subject matter.6 The 19th respondent says that it is appropriate for such an order to be made in this matter because of her age and state of health together with the distress and anxiety that she would likely suffer in the event of another such application.7 12 The orders, as originally sought, were imprecise and the 19th respondent also appeared to be relying upon the position of other residents besides herself. In oral submissions, counsel for the 19th respondent clarified that what was sought was an order or undertaking that the applicant be precluded from making a further application under s 58 of the Act on the same or similar grounds. It was further conceded that insofar as the written submissions relied upon the interests of other 6 FDN 127 at [50]. 7 FDN 127 at [52]. -- 5 of 9 -- [2025] SASC 10 McIntyre J 4 residents, the 19th respondent only seeks to advance the propositions from her perspective and does not rely upon the position of other residents. 13 The applicant objects to the orders sought on the basis that, in reality, what is sought is a form of perpetual mandatory injunction preventing the applicant from exercising its statutory rights under the Act. The Minister did not take a position as to the making of an order of this type other than to say that, as presently framed, it is an order in perpetuity. The Minister submitted that ordinarily such orders were combined with a time frame. The 19th respondent did not concede that a time frame is required. 14 The 19th respondent relied upon the decision of Judge Beazley in Shojaei v Disney8 (‘Shojaei’) in which he considered the case law applicable to a late stage application for leave to discontinue including Kennedy & Hunt v Griffiths & Griffiths9 (‘Kennedy’). Ultimately, Beazley DCJ granted leave to discontinue subject to stringent conditions that included a prohibition on instituting further proceedings unless and until the costs of the discontinued action were paid in full and, in any event, by a date specified in the order. In Kennedy, Justice Boddice granted leave to discontinue an application for contempt on condition that the plaintiffs were precluded from bringing any further contempt proceedings based on the same or similar allegations without leave of the Court. 15 The circumstances of those matters were significantly different to the current matter. Both arose in the context of a particular event. Shojaei was a claim in negligence and Kennedy was an application for contempt. The alternative in both matters was to dismiss the claim or application. This would have had the effect of preventing those applicants from bringing further proceedings arising from the same event. In each case, balancing the interests of the party seeking leave to discontinue and the interests of the opposing party who wished to have the proceedings finalised resulted in a finding that it was appropriate to impose limitations on the ability of the discontinuing party to relitigate. 16 This application arises in the context of an ongoing relationship between the parties. The applicant as the operator of the Scheme and the 19th respondent is a resident. Circumstances are likely to change over time. The Act provides a regulatory framework for the operation of retirement villages. Application of this framework requires a balancing of the rights and obligations of both residents and village operators. Relevantly, the applicant cannot unilaterally or partially terminate the Scheme. It must do so under the Act. One such mechanism is s 58, which enables an applicant to apply to the Supreme Court for the termination of a scheme either in part or in full.10 17 The applicant issued these proceedings under s 58 on 2 February 2022 seeking to partially terminate the Scheme in order to excise a portion of the village 8 [2014] SADC 109. 9 [2014] QSC 43. 10 Keyton Holdings Pty Ltd [2024] SASC 66. -- 6 of 9 -- [2025] SASC 10 McIntyre J 5 for commercial development. The application was necessary because many of the residents opposed the redevelopment. The residents of the village were joined as respondents to the proceedings by orders made on 9 March 2022. The matter was listed for trial on Tuesday, 12 March 2024 following various interlocutory steps being taken by the parties including obtaining expert reports on the impact of the proposed redevelopment on the village. 18 At trial, during the opening, the applicant indicated a change to the grounds for its application, specifically a change to the proposed redevelopment of the excised portion of the land. The 19th respondent and the interested party were taken by surprise having prepared for the trial on the basis of the original application. Ultimately the trial was adjourned in order to update the expert reports to deal with alterations to the proposed redevelopment and to conduct a further survey of residents as to the new proposal. The applicant was granted leave to file an application to amend the originating application and grounds. The question of costs thrown away in relation to the vacated trial was adjourned for argument. In the event, the application for amendment and the costs argument were overtaken by the present application for leave to discontinue. 19 The applicant’s sole director, Mr Giles, prepared an affidavit in support of the application for leave to discontinue and in particular he deposed that:11 The commercial conditions have changed since the institution of these proceedings, such that the proposed developments and any other similar development are now no longer commercially viable. 20 I have no reason to doubt that this is an accurate statement. Unfortunately, it has had the effect that the application was brought, partially litigated and then abandoned at a late stage without apparent regard for the legitimate concerns of the residents. 21 The 19th respondent’s affidavit sworn on 5 November 202412 attests to the anxiety and distress that she has suffered as a result of this litigation. Leaving aside contentious issues such as the state of the village to which I will refer shortly, such concerns are hardly surprising. The 19th respondent has sought to do no more than protect her quality of life. These proceedings have been on foot for over three years. The 19th respondent has been an active participant. She has attended numerous interlocutory hearings. She was prepared for trial only to have the trial adjourned due to the late change in position of the applicant. Even the application to discontinue was largely unheralded and occurred in circumstances where there were interlocutory arguments about further and better discovery and attempts to relist the matter for trial. The applicant’s conduct of its application has left much to be desired. 11 FDN 119 at [3.4]. 12 FDN 120. -- 7 of 9 -- [2025] SASC 10 McIntyre J 6 22 Litigation is notoriously stressful, particularly when the subject matter relates to matters such as housing or financial security. To have to deal with this litigation at an advanced age with a deteriorating state of health, as the 19th respondent has, is plainly liable to cause distress and anxiety of the type referred to in her affidavit. Discontinuance in these circumstances means that the 19th respondent is relieved of the immediate burden of these proceedings. It will however mean that the Court has expressed no views on the application or the terms upon which such an application might be granted notwithstanding that the application has been on foot for over three years. Discontinuance does not alleviate the 19th respondent’s legitimate concern that there might be future applications if the applicant forms the view that a similar redevelopment is commercially viable. An award of costs does not fully address the injustice that discontinuance at this late stage of proceedings will cause to the 19th respondent. 23 On the other hand, I accept the applicant’s contention that UCR r 141.4(2) is not a vehicle for substantive relief and that what is sought by the 19th respondent is tantamount to a permanent injunction preventing the applicant from exercising statutory rights under the Act. Accordingly, I do not consider that it is reasonable, or appropriate, to prevent the applicant from bringing a further application indefinitely. Rather, I consider that an appropriate ancillary order would be to prevent the applicant bringing an application under s 58 for partial termination of the Scheme to excise land for commercial development without leave of the Court for a period of two years from the date of discontinuance. Restoring the subject matter 24 The 19th respondent contends that the applicant took active and deliberate steps to alter the subject matter of the application without approval of this Court as required by the Act. The 19th respondent says that it is evident on the affidavit material that there has been degradation and dilapidation of the northern units and the area surrounding those units which was the subject of the proposed excision from the scheme (‘the northern unit area’). This causes disadvantage or prejudice to the 19th respondent not simply as to her outlook but also due to her concerns about security matters given criminal activities alleged to be occurring in the northern unit area. It is said that concerns were raised about the alteration of the northern unit area as early as June 2021. 25 The relief sought by the 19th respondent is substantive relief requiring the applicant to take positive action to “reinstate” the northern unit area. This relief was not the subject of any crossclaim by the 19th respondent in these proceedings. It is clear from the affidavit material, and in particular the affidavit of Kym David Ryder dated 17 January 2025,13 that there is a significant factual dispute between the parties as to the nature and condition of the northern unit area at various times. Moreover, it is apparent from the affidavit material that current work is being undertaken in that area which would complicate this issue further. 13 FDN 127. -- 8 of 9 -- [2025] SASC 10 McIntyre J 7 Resolution of this dispute would require further evidence and a number of findings before any enforceable order could be made. This would cut across the rationale for the early finalisation provisions in the UCR. The orders sought by the 19th respondent are not in my view appropriate as ancillary orders to an application for leave to discontinue. 26 The 19th respondent moreover has other remedies available to her. If the 19th respondent wishes to assert that the applicant has breached the terms of her residence contract, has breached the Act or has acted in a harsh or unconscionable manner in relation to the northern area of the village, she can avail herself of the dispute resolution mechanisms in that Act. She may also make an application to the South Australian Civil and Administrative Tribunal (‘SACAT’) under s 46 of the Act. She is not precluded from that course of action by the discontinuance of these proceedings. Increased fees and levies 27 The 19th respondent seeks orders to ensure that the costs of and incidental to this application, including costs arising due to destruction and or neglect of the northern area, not be passed on to the residents in the form of levies or other charges. The affidavit of Mr Ryder confirms that the residents have, correctly in my view, not borne any legal costs as a result of the application. This leaves the question of costs associated with the rectification, if necessary, of the area of the village that the applicant sought to excise from the Scheme. It is my view, consistent with the ruling I have made in relation to reinstatement, that the order sought by the 19th respondent goes beyond the scope of orders that may be made on a discontinuance. There is no evidence that might justify the order sought by the 19th respondent and there are potentially contested matters of evidence which are not appropriately dealt with by way of ancillary orders on an application for leave to discontinue. 28 The 19th respondent has other remedies under the Act if she wishes to challenge any charges levied by the applicant. There are dispute resolution processes under the Act including an application to SACAT. Conclusion 29 In conclusion, I will grant leave to the applicant to discontinue as against the 19th respondent subject to the payment of her costs and subject to an order preventing the applicant bringing a similar application under s 58 for partial termination of the Scheme for a period of 24 months without leave of the court. I will hear parties on the form of the orders to be made. -- 9 of 9 --