Worked example: an older person entering residential aged care in South Australia 

This worked example states Commonwealth law and the law of South Australia. It uses no authority that is not established in the linked articles.

The facts

Mrs K is 84 and lives alone in Adelaide. After a fall and a long hospital admission, the hospital says she cannot return home safely. Her daughter, R, has found a residential aged care home with a place available next week.

Mrs K signed an advance care directive four years ago. It says she does not want to be resuscitated, and that she "would prefer to stay in my own home as long as possible". She has not made an enduring power of attorney. She owns her home and has modest savings.

Mrs K is intermittently confused. On a good day she says she does not want to go into a home. R says she has "lost capacity" and wants to sign the paperwork herself, sell the house to fund the accommodation payment, and get her mother admitted.

Advise.

Step 1 — Split the jurisdiction before advising on anything

Two bodies of law apply and they answer different questions.

Commonwealth. Whether the home is a registered provider; the subsidy it receives; what Mrs K may be charged; means testing; the accommodation payment and any refundable deposit. All of this is the Aged Care Act 2024 (Cth), Chapter 4.¹

South Australia. Whether Mrs K has capacity; whether her advance care directive governs anything here; who may make decisions she cannot make; who may deal with her house; and whether her daughter can be authorised to act.

R's plan mixes the two, which is why it will not work as stated.

Step 2 — Capacity is not a global finding

R says Mrs K has "lost capacity". That is not a legal conclusion in South Australia, and two provisions answer it.

Section 3 of the Guardianship and Administration Act 1993 (SA) defines mental incapacity as the inability to look after one's own health, safety or welfare, or to manage one's own affairs.² Section 7(2)(d) of the Advance Care Directives Act 2013 (SA) provides that decision-making capacity is not to be taken as impaired merely because a decision results, or may result, in an adverse outcome.³

So: Mrs K's refusal to enter care is not evidence that she lacks capacity. It is a decision that may have an adverse outcome, and s 7(2)(d) forbids reasoning from the second to the first. Intermittent confusion may bear on capacity; disagreement with her daughter does not.

If capacity is genuinely in question, it must be assessed — and assessed for the decisions actually in issue.

Step 3 — Read the directive, and read it correctly

Mrs K's directive contains two things, and they do different work.

The refusal of resuscitation is a refusal of particular health care. Section 19(1) of the Advance Care Directives Act 2013 makes a refusal binding. It is the strongest thing in the document.

The preference to stay at home is not a refusal. Section 19(1) makes refusals binding; it does not make positive preferences binding in the same way. The statement is relevant, and it is evidence of what Mrs K wants, but it does not by itself prevent an admission.

Note also s 13: the directive cannot give a power of attorney. Whatever it says, it confers no authority over the house or the savings.

Step 4 — There is no enduring power of attorney, so no one can deal with the house

R wants to sell the house. She cannot.

Financial and property authority in South Australia comes from the Powers of Attorney and Agency Act 1984 (SA).⁴ Mrs K has not made an enduring power under s 6. The directive does not supply one (s 13). R therefore has no authority over the house or the savings, and a purported sale by her would be a sale by someone with no power to sell.

Two routes exist.

If Mrs K has capacity for the decision, she may make an enduring power of attorney now, complying with the s 6 formalities. That is the less restrictive answer and should be considered first. If appointed, R would owe the s 7 duty to act with reasonable diligence to protect the interests of the donor, and would be exposed to the accounts obligations in ss 8 and 9. Advise R of that before she accepts.

If Mrs K does not have capacity, an administration order under s 35 must be sought from SACAT. Section 5(d) requires the course adopted to be the least restrictive of Mrs K's rights and personal autonomy consistent with her proper care and protection — so seek an order limited to what is actually needed, not a full order because it is simpler.

A guardianship order under s 29 is a different application, addressed to personal and lifestyle decisions including where she lives. Do not conflate the two: SACAT may make one without the other.

Step 5 — Now the Commonwealth questions

Only once someone has authority to act can the aged care paperwork be dealt with.

The daily fees. Section 277 of the Aged Care Act 2024 (Cth) works out the maximum daily amount of the resident contribution in four steps: the basic daily fee, plus any compensation payment fee, plus the hotelling contribution under s 278, plus the non-clinical care contribution under s 279. Section 280 makes the last two zero in some circumstances. The amounts themselves are in the Aged Care Rules 2025, not in the Act.

Means testing. Because this is an approved residential care home, Part 5 Division 2 applies and produces a daily means tested amount under s 319 — a dollar figure per day, worked out from total assessable income determined under s 322 and assets valued under s 329. This is not the percentage individual contribution rate under s 314, which applies in a home or community setting. Do not use the wrong one.

Accommodation. Whether Mrs K pays an accommodation payment or an accommodation contribution turns on her daily means tested amount on her start day (s 190). Section 298(a) provides that she must not be charged an accommodation contribution unless that amount is less than the maximum accommodation supplement amount for the day. Given she owns her home, the payment route is the likely one — but that is a calculation, not an assumption, and it needs the s 319 figure.

The agreement, and its timing. Section 293(1) requires the provider to enter an accommodation agreement before it starts delivering ongoing services. Section 293(2) is the protection to hold on to: the provider must not require Mrs K to choose how to pay before her start day. R will be told a lump sum is needed to secure the place. Section 293(2) says the choice cannot be demanded before the start day.

The refundable deposit. If a lump sum is paid, s 305(1) prohibits the provider from accepting it where Mrs K has given enough information for her daily means tested amount to be worked out, pays within 28 days after her start day, and payment would leave her remaining assets below the minimum permissible asset value — which s 305(2) fixes at 2.25 times the basic age pension amount, rounded to the nearest $500, or a higher amount prescribed by the rules. Selling the house and paying the proceeds across would engage this provision directly.

Step 6 — If things go wrong later

Two South Australian routes are worth naming now.

A complaint about the home. Section 24 of the Health and Community Services Complaints Act 2004 (SA) sets out who may complain.⁵ It is not limited to Mrs K: a substitute decision-maker may complain, and so may another person where it would be unreasonable to expect the consumer to complain personally (s 24(da) and (g)).

Abuse or neglect. If Mrs K is being mistreated — including financially, by a family member — the Ageing and Adult Safeguarding Act 1995 (SA) applies.⁶ She is a relevant adult if she may be vulnerable to abuse (s 3(1)), and abuse is defined by conduct within a relationship of trust, dependency or imbalance of power (s 4(1)). Reporting is voluntary (s 22(4)(a)), and the safeguarding response is consent-based subject to the s 28 exceptions, with SACAT able to authorise action she has refused (s 33(1)(c)).

The advice, in short

1. Do not accept that Mrs K lacks capacity. Section 7(2)(d) forbids the inference R is drawing.
2. The refusal of resuscitation binds; the preference to stay home does not.
3. The directive gives R no authority over property. Section 13 says so.
4. If Mrs K has capacity, make an enduring power of attorney now. If not, apply to SACAT for a limited administration order, and separately consider guardianship.
5. Do not let anyone sell the house until authority exists, and check s 305 before any lump sum is paid.
6. Get the daily means tested amount worked out under s 319 before agreeing to an accommodation payment.
7. Rely on s 293(2): the payment choice cannot be demanded before the start day.

Self-check

• Did I separate the Commonwealth questions from the South Australian ones before advising?
• Did I resist reasoning from an adverse outcome to incapacity?
• Did I treat the directive as binding only as to refusals?
• Did I use the residential-care means test rather than the home-setting one?
• Did I check the minimum permissible asset value before the lump sum?