Under the Health
Act 2007, nursing homes in Ireland are required to enter what is known as a
‘contract of care’ with each resident.
This summer, the Competition and Consumer Protection Commission (the “CCPC”), in response to concerns over
unfair terms in such contracts, published guidelines (the “Guidelines”) to ensure that nursing home contracts with residents
do not incorporate unfair terms.
The aim is to
give greater transparency to residents and their families as to what they are
signing up to. Contracts of care should be provided to consumers in plain
English using easy to understand provisions.
What is an Unfair Term:
An unfair term
is one that significantly imbalances the contract and places the consumer at an
Under section 3
of the Guidelines, the CCPC advises in regard to the following terms in nursing
home Contracts of Care:
be informed of all details of fees (including circumstances around additions
and variations to fees) before a contract is entered into. Where optional
services (with optional fees) are offered to residents, they should be afforded
the opportunity to either agree or disagree to availing of the services
Changes to the Contract
to a contract without prior consultation is unfair unless a change is required
to comply new regulations. Any changes made after signing must be reasonable
and clearly communicated to the resident as soon as possible.
Terms in a
contract that pass obligations from the resident to a guarantor may be unfair
if they lack certainty and do not fully inform the guarantor of the obligations
that they are entering into.
Sanctions for breach of contract
If a breach of
contract occurs, the resident should only be liable for the actual damage caused.
Terms that bind consumers to pay interest on any outstanding fees must be
A term that unreasonably
restricts residents from receiving visitors or allows the nursing home a wide
discretion to restrict visitors, may be classified as an unfair term. Visitors
should be restricted only in very limited circumstances.
The contract of
care should set out how periods of absenteeism are dealt with in regard to
fees. The terms must be fair to the resident, for example the providers must
consider the cost savings that they will incur whilst the resident is not
availing of its services.
It should be straightforward
for a consumer to terminate the contract of care. The terms in which a contract
can be terminated by the provider must be laid out in the contract of care in
an understandable and precise manner. A term imposing a wide discretion on the
part of the nursing home will not be fair on the resident.
refer to the “grey list” which is a non-exhaustive list of terms that may be
unfair in some circumstances but not others.
The main terms
of the contract, such as the nursing home services offered and prices for the services,
are exempt from the Unfair Terms Regulation provided they are outlined in plain,
simple and transparent language.
provide where ambiguity arises in a contract of care, words are interpreted in
the favour of the consumer. Onerous terms should not be hidden or put in small
print of contracts.
Nursing homes across Ireland should review their contracts of care to ensure that they are in compliance with the Guidelines.
About the Author, Gríana O’Kelly – Partner, Corporate and Commercial Department.