Alexander Nicholson, David Swire and Ronald Brooks v M & T Entriken Pty Ltd trading as M & T Entriken Property Trust - [2013] QCAT 716

CITATION:

Alexander Nicholson, David Swire and Ronald Brooks v M & T Entriken Pty Ltd trading as M & T Entriken Property Trust [2013] QCAT 716

PARTIES:	Alexander Nicholson, David Swire and Ronald Brooks (Applicants)
v
M & T Entriken Pty Ltd trading as M & T Entriken Property Trust (Respondent)

APPLICATION NUMBER:

OCL094 – 12

MATTER TYPE:

Other civil dispute matters

HEARING DATE:

3 May 2013

HEARD AT:

Hervey Bay

DECISION OF:

Member Milburn

DELIVERED ON:

20 June 2013

DELIVERED AT:

Hervey Bay

ORDERS MADE:

1. The site rent increase effective from 4 October 2012 is reduced from $160 per site per week to $147 per site per week.

2. The respondent must refund to the applicants any overpayment of the site rent since when the increased site rent has been paid.

CATCHWORDS:

Manufactured homes – market rent review – consider the site rental charged by comparable parks as at the date of the proposed increase in the site rent payable and not the date of hearing – interpretation of the term ‘previous site rental period’ – having regard to capitalisation rates in determining whether the increase is fair and equitable – inequality of bargaining position between the park owner and the homeowners

APPEARANCES and REPRESENTATION (if any):

APPLICANT:

Mr Alexander Nicholson, Mr David Swire and Mr Ronald Brooks

RESPONDENT:

M & T Entriken Pty Ltd trading as M & T Entriken Property Trust represented by Mr Michael Entriken

REASONS FOR DECISION

Three years ago parties with an interest in Hazelmere Village Hervey Bay[1] were involved in tribunal litigation[2]. The litigation was to do with determination of site rental and this case deals the same issue in the same manufactured home residential park.
[1]Hazelmere Village Home Park is a residential park under the Manufactured Homes (Residential Parks) Act 2003. The Park contains 98 sites.
[2]Nicholson v Hazelmere Village Home Park [2010] QCAT 678. The applicant was a homeowner (and is one of the applicants in the current case) and the respondent was the park owner.
The applicants are homeowners[3], pensioners, paying site rent. The respondent, the park owner[4], is the recipient.
[3]The applicants (Messrs Nicholson, Swire and Brooks) are homeowners in the park.
[4]The respondent (M & T Entriken Pty Ltd trading as M & T Entriken Property Trust) is the owner of park.
A new weekly site rent was determined by the park owner as a result of a market review.
A rent review cycle occupies three years[5]. Determining the appropriate site rent at the end of years one and two is an easy exercise – one simply applies the appropriate increase in the consumer price index. But in year three, the weekly site rent is to be reviewed to market[6].
[5]The site agreements provided for the site rent to be reviewed to market in 2012.
[6]The tribunal was provided with a copy of the various site rent agreements relevant to the park.
Much rides on the outcome. For the homeowners, the weekly increase payable may affect their discretionary expenditure and may affect the saleability of their home. For the park owner a denial of an increase may affect the financial stability of the business, from an income and capital perspective. The value of the park is often determined by return on capital to a prospective purchaser[7]. An increase in income of $100,000 at, say, a capitalisation rate of 10%[8] has the resultant effect of increasing the capital value of the park by an additional $1 million[9].
[7]This information was provided by Mr Jamie Brown of Herron Todd White valuers at the hearing.
[8]Whilst giving evidence, Mr Brown spoke to the basis upon which Manufactured Home Parks might be valued. He spoke of parks being valued in accordance with capital return. He suggested a capitalisation rate of 8.5% to 9.5% is appropriate.
[9]The evidence of Mr Brown was that adopting a lower capitalisation rate leads to a greater capital value. The figure of one million dollars is determined purely by reference to capitalisation rates and does not necessarily take into account other matters which may be of significance to a prospective purchaser of a park.
On 17 August 2012, a director of the respondent (Mr Entriken) sent correspondence to all of the homeowners in the park[10]. He advised the site rental was to be increased to the amount of $160 per week, effective from 4 October 2012. The rent was previously $142 per week per site. The increase of $18 per week per site for 98 sites[11] equates to an additional annual income of $91,728 to the respondent.
[10]The notice complied with section 69 of the Act.
[11]Assuming site rent is collected for each site. The evidence, accepted by the tribunal, is that site rent is charged against the estate of a deceased homeowner.
Messrs Nicholson, Swire and Brooks[12] argue the increase is excessive.
[12]They each brought separate actions, which were consolidated into this one action, pursuant to section 70(1)(b) of the Act.
The role of the tribunal
The tribunal may order the increase sought by the park owner, set it aside, confirm it on conditions or make another will order as the tribunal considers appropriate[13]. The tribunal may have regard to certain matters[14].
[13]Section 70(2) of the Act.
[14]In deciding the application the tribunal may have regard to matters outlined in section 70(3) of the Act. These are:
a)the range of site rents usually charged for comparable sites in comparable residential parks in the locality of the park;
b)if it is impractical to obtain data for the range of site rents mentioned in paragraph (a), data is not available for that range or it is just and equitable to do so in the particular circumstances the range of site rents usually charged for comparable sites in comparable residential parks in comparable localities to the locality the park is in;
c)if it is impractical to obtain data for the range of site rents mentioned in paragraph (a) or (b), data is not available for that range or it is just and equitable to do so in the particular circumstances general trends in rent for residential accommodation in the locality the park is in;
d)the increased site rent compared to the previous site rent;
e)the frequency, and amount, of past increases in the site rent payable under the agreement;
f)any increase in the CPI number during the previous site rent period;
g)the amenity or standard of the common areas and communal facilities;
h)any withdrawal of a communal facility or service previously provided at the park;
i)any addition of a communal facility or service not previously provided at the park;
j)any increase in the park owner's operating costs for the park during the previous site rent period;
k)whether the increase is fair and equitable in all the circumstances of the case;
l)anything else the tribunal considers relevant.
The tribunal can also order the park owner refund the homeowners any overpayment of the site rent since when the site rent was increased[15].
[15]Section 40(4) states - If, in deciding the application, the tribunal makes an order mentioned in subsection (2)(a) or (b), the park owner must refund to the home owner any overpayment of the site rent since when the increased site rent has been paid.
Expert valuation evidence
The tribunal welcomes expert valuation evidence in such cases. In this case, Mr Entriken obtained rental assessment valuations from Mr Alan Gees of Opteon and from Mr Jamie Brown of Herron Todd White. They assessed a fair market site rent as being $160 per site per week.
Messrs Nicholson, Swire and Brooks obtained a rental assessment valuation from Mr Jeremy Rutledge of National Property Valuers. He assessed a fair market site rent as being $145 per site per week.
Decommission of the Park bowling green
Prior to the hearing but after the rent review date, Mr Entriken advised the homeowners the on-site bowling green would be decommissioned[16]. The bowling green had been vandalised in October 2012 and was in need of repair. Also, the Council[17] had given notice to Mr Entriken that the bowling green encroached over a council sewer easement on the western end of the park.
[16]Entriken, through its director Mr Michael Entriken, confirmed this position at the hearing.
[17]Fraser Coast Regional Council.
Mr Entriken obtained a temporary permit from the Council to retain the bowling green in its current site notwithstanding the encroachment until July 2015 after which date, without further permit, the facility was to be removed, at least in part, to allow for the encroachment to be removed.
Mr Entriken sought an indication from both Mr Gees and Mr Brown as to the likely effect on the market site rental. Mr Gees considered that if the bowling green was replaced with a tennis court there is no reason to adjust the rental assessment[18]. Mr Brown considered the site rental should be reduced by $1.30 per site per week if the facility is removed prior to 2015. Mr Rutledge determined his valuation on the basis that the bowling green was unusable.
[18]The proposed tennis court as a replacement for the bowling green was not met with favourable comment by the applicants.
The bowling green has not been repaired but it has not been removed.
Mr Entriken invited the tribunal to consider a site rental reduction based on its decision to decommission the Park bowling green. The tribunal is able to reduce site rental on application by the homeowner under a site agreement[19]. In my view, there has not been an application made by homeowners for site rental reduction based on the decommission/pending removal of the bowling green and as a result I do not propose to make any order pursuant to section 72 of the Act.
[19]Section 72 of the Act.
I proceed on the basis that the bowling green is currently in a state of disrepair but not removed. If the bowling green is removed it is open for the homeowners or any one of them, to make application pursuant to section 72 of the Act. I do, however, proceed in this hearing on the basis that the bowling green having been decommissioned, will not be available for use as a communal facility and the site rent payable from October 2012 should reflect this fact.
Park owner's proposal to change the rent review formula
Mr Entriken invited the tribunal to consider making an order to change the rent review formula. There is no evidence that the homeowners wish the tribunal to do so and the applicants in this hearing specifically rejected such proposal.
Section 68 of the Act provides that the site rental payable under a site agreement may only be varied in the way stated in “this part”[20]. A special term of the site agreement may be varied at any time while the agreement is in force[21].
[20]Part 11 of the Act; comprising sections 68 to 74A, inclusive.
[21]Section 22 of the Act.
I do not believe it appropriate to consider the proposed variation without a clear indication that all relevant parties, namely homeowners, have had an appropriate opportunity to consider the proposal. In my view to do so would offend principles of natural justice. I conclude I should not therefore do so.
Section 70(3) factors
Section 70(3)(a) the range of site rents usually charged for comparable sites in comparable residential parks in the locality of the park
In his report, Mr Gees provided comparative rents charged by four manufactured home parks in Hervey Bay. These are Hazelmere Village, Sugar Coast, Golden Shores and Torquay Waters. A fifth, Noble Lakeside was discounted on the basis that ‘there are incentives with the rent in order to sell the homes which have a higher entry-level than genuine mobile homes’.
In their respective reports, Mr Brown and Mr Rutledge provided comparative rents charged by all 5 manufactured home parks in Hervey Bay referred to above.
Should the tribunal consider rent charged as at the date of the proposed increase or date of hearing?
Mr Brown considered the site rental charged by the Sugar Coast as at the date of his report[22]. Mr Brown and Mr Rutledge considered the site rental charged as at the date of rent review.
[22]In evidence, Mr Brown made reference to the site rental applicable to the Sugar Coast Village in 2013. He did so in the context of comparing the appropriate site rental in Hazelmere Village with Sugar Coast Village. In his valuation report however he does make reference to his brief to assess the weekly site rental of the park at a retrospective assessment date of 4 October 2012 (paragraph 7 on page one of his report).
In my view, it is appropriate to consider the site rental charged by comparable parks as at the date of the proposed increase in the site rent payable and not the date of hearing. I agree with the approach taken by Mr Gees and Mr Rutledge in this regard.
Should the tribunal consider the site rent charged in all five parks or only four, that is, exclude Noble Lakeside?
I believe it appropriate to consider the site rent charged by all 5 manufactured home parks referred to in the reports of the experts. Other than the statement made by Mr Gees, no evidence was presented to suggest the site rent payable by the Noble Lakeside homeowners should not be considered. I agree with the approach taken by Mr Brown and Mr Rutledge in this regard.
The valuers have provided comparisons in relation to facilities offered by manufactured homes parks in Hervey Bay.
The evidence suggests that site rental for manufactured home parks located within Hervey Bay were at the time of the increase[23]:
a)    Hazelmere Village        $142.00[24];
b)    Sugar Coast village      $139.65;
c)    Golden Shores              $157.50-$167.50;
d)    Torquay Waters            $149.10[25];
e)    Noble Lakeside             $152.75[26].
[23]4 October 2012.
[24]Mr Brown refers to the site rent payable at Sugar Coast as being $158.00 per site per week. I do not accept this was the site rental payable at the time of the site review in this case.
[25]Mr Brown and Mr Rutledge referred to the weekly rent payable at Torquay Waters as $149.10. Mr Gees reported the rental to be $155.10. The evidence of Mr Brown and Mr Rutledge is preferred.
[26]Mr Gees and Mr Rutledge referred to the weekly rent payable at Noble Lakeside as $152.75. Mr Brown reported the rental to be $153.00. The evidence of Mr Gees and Mr Rutledge is preferred.
By determining that an appropriate market rental for sites in Hazelmere Village is $160.00 per site, valuers Mr Gees and Mr Brown have therefore placed it as a village superior to Sugar Coast Village, Golden Shores (normal site), Noble Lakeside and Torquay Waters.
In his valuation, Mr Gees does little to support this conclusion other than by providing a list of comparison of facilities. Mr Brown and Mr Rutledge provide far more detail.
I accept the evidence of Mr Rutledge that Noble Lakeside and Golden Shores are superior to Hazelmere Village. I also accept his evidence that Sugar Coast village is inferior to Hazelmere Village. I also accept his reasons to conclude that Torquay Waters is superior to Hazelmere Village.
I do not accept the evidence of Mr Gees and Mr Brown in concluding that the site rental for sites in Hazelmere Village should be greater than the site rental for sites in Golden Shores (normal site), Torquay Waters and, in the case of Mr Brown, Noble Lakeside.
In his report, Mr Brown states that “Noble Lakeside increased rents to market levels in July 2012 with the increase being ratified in the State Tribunal.[27] Noble Lakeside is under development and is representative of a new quality of MHRP with million-dollar facilities and high quality manufactured homes that appear like typical residential homes.[28] At present, Noble Lakeside does not have a sufficient quantum of sites for site rent to support a positive cash flow to maintain park operating expenses. In this instance, whilst in its early stages of development, Noble Lakeside recoups facility costs and expenses through the sale of high quality manufactured homes.[29] Therefore, in this instance, Noble Lakeside is not considered to be directly comparable to the subject due to the superior quality manufactured homes on offer and the fact that it is under development.[30]”
[27]Paragraph 60 of his site rental assessment report of Hazelmere Village Home Park dated 15 April 2013.
[28]Paragraph 61.
[29]Paragraph 62.
[30]Paragraph 63.
Respectfully, I do not accept the evidence of Mr Brown in this regard. There is no evidence before the tribunal to support his financial conclusions. Whilst I have not been referred to the specific decision which resulted in the increase being ratified in the “State Tribunal”, I accept that the site rental determined for Noble Lakeside is a fair site rent.
Mr Brown states that ‘Golden Shores is scheduled for a review to market in October 2013. Historically the Park has a $4-$10 buffer above the subject’.[31] I am not going to speculate as to what might happen in a review in October 2013.
[31]Paragraph 66.
Mr Brown states that in relation to Sugar Coast ‘the park is currently going through Tribunal to hear whether the owner can recoup costs to bring the 5% fixed sites up to $158 per week. At the date of assessment, the site rents were at $139.65 per week with water charge separately.[32] The 32 site rents of Sugar Coast are considered to be more comparable to the subjects as they have the ability of market review’.[33] I am not going to speculate as to what might happen in the tribunal proceedings referred to. In any event, the Sugar Coast review postdates the review date relevant to these proceedings.
[32]Paragraph 67.
[33]Paragraph 68.
Section 70(3)(d) the increased site rent compared to the previous site rent;
The previous site rent was $142 per week site. The increased site rent is $160 per person. The increase of $18 per week per site equates to an increase of 12.7%.
The Consumer Price Index for Brisbane in September 2012 rose by 1.7% compared to the same quarter in September 2011.
Section 70(3)(e) the frequency, and amount, of past increases in the site rent payable under the agreement;
Section 70(3)(f) any increase in the CPI number during the previous site rent period;
The site rent for the park was assessed in the amount of $132.50 per week from 1 October 2009 by order of member Mr Simon Burgess in the Queensland Civil and Administrative Tribunal case of Alex Nicholson and others v Gordon and Jeanette Gray trading as Hazelmere Village Home Park[34].
[34]Nicholson v Hazelmere Village Home Park [2010] QCAT 678.
In October 2010 and October 2011 the site rent for the park was adjusted in accordance with rises in the Consumer Price Index.
The increase in site rent of $27.50 per site per week from October 2009 to October 2012 ($132.50[35] to $160.00[36]) equates to an increase of 20.8%.
[35]As assessed by member Mr Simon Burgess in Nicholson v Hazelmere Village Home Park [2010] QCAT 678.
[36]Being the amount charged as at 4 October 2012.
The Consumer Price Index for Brisbane in September 2009 was 94.2 and in September 2012 was 101.6[37]. This increase is 7.9%.
Section 70(3)(g) the amenity or standard of the common areas and communal facilities;
[37]Australian Bureau of Statistics, All Groups CPI index numbers (Brisbane).
In his material, Mr Entriken refers to expenditure in relation to ‘major items of improvement’.[38] The expenditure includes expenditure relevant to residence directly and indirectly. It includes items of capital expenditure such as resealing of roadways within the village. Expenditure was incurred by Hazelmere Village over the period 1 July 2008 to April 2013[39]. Mr Entriken did not state which expenditure was incurred before the review in 2009[40].
[38]Respondent’s submissions at page 8 and page 9.
[39]Report dated 16 April 2013 prepared by accountant Mr Jamie Mobbs of Mobbs and company certified practising accountants.
[40]and therefore considered by member Mr Simon Burgess in Nicholson v Hazelmere Village Home Park [2010] QCAT 678.

In relation to the park, Mr Gees states in his valuation report dated 30 November 2012:
a)    it has 98 sites plus the manager’s residence with office/reception, community hall which provides a library, DVD library, outdoor bowling green and indoor bowls;[41]
b)    the park is adjacent to the Eli Waters shopping village;[42]
c)    Hazelmere Village is a very well presented mobile home park and is adjacent to a shopping centre and is also within a modern residential area;[43]
d)    the park has excellent facilities and at time of inspection was in good condition;[44]
e)    the park has generally larger sites than other parks and offers extra services in road width, library and bowling green.
[41]        page 2 of the Mr Gees valuation.
[42]        as above.
[43]        page 4 of the Mr Gees valuation.
[44]        as above.
In relation to the park, Mr Brown states in his valuation report dated 15 April 2013, Hazelmere Village has the following facilities/services:
a)    clubhouse – open plan design, parquetry dance floor, lounge area, kitchen, LCD TV service, extensive book library, extensive DVD library, pool table, indoor bowls and amenities;
b)    patio barbecue area;
c)    resort style pool and spa with 2nd barbecue area;
d)    four-rink outdoor bowls green (damaged as at the date of inspection);
e)    workshop;
f)     resident managers.
In relation to the park, Mr Rutledge states in his valuation report dated 9 March 2013:
a)    Hazelmere Village consists of 98 sites together with the manager’s residence – attached office, community hall and barbecue area, outdoor bowling green, in-ground pool and workshop. The internal road system is bitumen sealed having concrete curving and guttering;[45]
b)    With the exception of the bowling green the condition of the complex facilities are generally in keeping with their age. The bowling green remains out of service (since mid-October 2012) hence has not been available for use since that time[46].
[45]        page 3 of the Mr Rutledge valuation.
[46]        page 9 of the Mr Rutledge valuation.
In the valuation reports of both Mr Brown and Mr Rutledge, specific reference is made to the bowling green. Specifically, that the bowling green was damaged[47] and not in service[48]. In his valuation, despite undertaking an inspection after the date of damage incurred to the bowling green, Mr Gees makes no comment to this effect. In this regard the evidence of Mr Brown and Mr Rutledge is preferred.
[47] page 1 of the Mr Brown valuation.
[48] page 14 of the Mr Rutledge valuation.
Overall, the evidence of the expert valuers suggests the facilities at Golden Shores and Noble Lakeside are superior to the facilities at Hazelmere Village.
Likewise, the facilities at Sugar Coast village were regarded as inferior to the facilities at Hazelmere Village.
Whilst the facilities at Torquay Waters were regarded as inferior to the facilities at Hazelmere Village, the evidence of Mr Rutledge was that Torquay Waters is a superior park given it is a of a boutique nature and close to the beach. I accept this conclusion.
In my opinion, certain matters such as the number of DVDs or books available to residence, lawn mowing services and rubbish/green waste collection are of considerably less significance than other facilities such as community hall, swimming pool and outdoor bowling green when comparing the overall standard of the communal facilities between one park and another.
Section 70(3)(h) the withdrawal of a communal facility or service previously provided that the park;
In its submission to the tribunal Mr Entriken stated that ‘the respondent has not removed any service or facility’[49]. Respectfully, I disagree. The evidence is to the contrary as Mr Entriken has decommissioned the bowling green which has not been in service since October 2012. As indicated above, correctly in my opinion, both Mr Brown and Mr Rutledge have identified this loss of communal facility.
[49] page 10 of the respondent submissions.
In my opinion, the loss of the bowling green is significant.
The evidence to the tribunal by the applicants, which is accepted, is that it is regarded by them as an important feature of the park.
Section 70(3)(i) the addition of a communal facility or service not previously provided that the park;
In its submission, Mr Entriken states that
a workshop was previously available for homeowners use, the facility was shared with dry storage of homeowners’ possessions and the storage of village tools and machinery such as lawnmowers, none of which were locked. The respondent has transformed this workshop and constructed one specifically designed for homeowners use, which is locked up for added security to the workshop and the dry storage area.[50]
[50] page 10 of the respondent submissions.
Nothing further has been added. In my view the addition referred to above is of little consequence.
Section 70(3)(j) any increase in the park owners operating costs for the park during the previous site rent period;
In his submissions, Mr Entriken identifies a number of items where the park owner’s operating costs for the park have increased.[51]
[51]page 11 to page 17 of the respondent submissions inclusive.
Whilst I have no doubt that the operating expenses of the park have increased year by year, I find the submissions for the respondent somewhat confusing and self-serving.
The Act provides for the tribunal to consider the increase in park owner’s operating costs for the park during the previous site rent period. ‘Previous site rent’ means the site rent payable under the agreement before the increase. The ‘previous site rent period’ means the period commencing on the first day the previous site rent was payable and ending on the day the tribunal decides the application.[52]
[52]Section 70(6) of the Act.
In the context of considering section 70(3)(J) of the Act in this instance, the previous site rent period commenced October 2011. Therefore, it is appropriate to the tribunal to consider any increase in the park owner’s operating costs for the park during the period October 2011 to October 2012.[53]
[53]This was the approach adopted by member RV Hanson QC in the commercial and consumer tribunal decision of Beaumont, Bigwood, Dowding, Lowes, & Woodcock v New Concept Developments Pty Ltd [2007] QCCTMH 26.
In its submissions, Mr Entriken refers to different periods of time, somewhat selectively. For instance,
a)    petrol for the period 2009 – 2011;
b)    electricity for the period 2009 to 2011;
c)    electricity service fee as at 1 July 2012;
d)    electricity increases on 22 February 2012;
e)    WorkCover between 2009 and 2012;
f)     wage increases from 2010 to 2012;
g)    bank charges between 2009 to 2011;
h)    vehicle registration from 2009 to 2012;
i)     tradespersons hourly rate during the last site rent period;
j)     swimming pool labour costs since 2009;
k)    park insurance fees from 2011 to 2012;
l)     accounting fees from 2009 to 2012;
m)   government operational compliance permits from 2009 to 2012;
n)    expenses of materials from 2009 to 2012;
o)    vehicle repair expenses from 2009 to 2012;
p)    repair and maintenance expenses from 2009 to 2012;
q)    superannuation expenses from 2009 to 2012;
r)     security patrol expenses during the last site rent period;
s)    valuation fees – unspecified;
t)     purchase a photocopier – unspecified;
u)    repairing and repainting village sign – unspecified; and
v)    council rates for 2009 and 2010, for 2010 and 2011, for 2011 and 2012.
Mr Entriken did not provide profit and loss statements to assist in determining past expenditure nor cash flow projections to determine anticipated expenditure.
Mr Entriken referred to a report dated 16 April 2013 prepared by accountant Mr Jamie Mobbs of Mr Mobbs and Company, certified practising accountants.
In his report, Mr Mobbs makes reference to a number of items of expenditure incurred the park owner in relation to operating costs for the park.
I have trouble in accepting much of Mr Mobbs’ report. Whilst specifically making reference to acting as an independent expert[54], it reads more as a submission in support of the respondent’s case than a report of an independent expert. The report makes reference to the applicants’ submissions in relation to financial estimation on Hazelmere Village income/expenses. In his report, Mr Mobbs says ‘these are irrelevant estimations and hold no reliability or value in this case’[55]. With respect to Mr Mobbs, I disagree. In order to apply section 70(3)(J) of the Act, it is necessary to properly determine the operating costs for the park during the site rent period. I prefer the approach of the applicants in this regard.
Section 70(3)(j) any increase in the park owners operating costs for the park during the previous site rent period;
[54] page 1 of the Mobbs report.
[55] page 3 of the Mobbs report.
Increase in park owners operating costs of the park from the preceding market review, in this case 2010, may nevertheless be considered by the tribunal when determining whether the increase is fair and equitable in all the circumstances of the case.
It is apparent that the park owners’ expenses have increased considerably in some instances. This must have a bearing on the decision.
I fully appreciate the reluctance the park owners would have in disclosing their profit and loss figures. The approach adopted by member Mr RV Hanson QC in the Commercial and Consumer Tribunal decision of Beaumont, Bigwood, Dowding, Lowes, & Woodcock v New Concept Developments Pty Ltd [2007] QCCTMH 26[56] was to order that part of the evidence is not to form part of the record available for inspection by members of the public.
[56] at paragraph 27.
I have already made reference to the fact that a relatively modest increase in the site rental has the potential to lead to a considerable notional increase in the value of the Manufactured Home Park.
There is an inequality of bargaining position between the park owner and the homeowners which cannot be ignored. In a Manufactured Home Park the homeowners are likely to be older citizens. The homeowners are likely to be far less financially able to fund expert reports than the park owners. Given the serious financial ramifications to the owner there is greater incentive for the owner to resource the litigation.
In such circumstances, the position of the homeowners may not be advanced as professionally as that of the park owner or resourced to the same extent.
Conclusions
In determining matters such as this, the tribunal will carefully consider the expert evidence provided to it. Of particular significance, is the evidence of the valuers.
For the reasons outlined above, if called upon to choose between the differing views, I prefer the evidence of Mr Rutledge.
Mr Rutledge did, however, candidly concede he was not able to take into account various specific expenses incurred by the park owners. Mr Entriken indicates this is because he did not request the information however I find this approach disingenuous.
Mr Rutledge indicated his view that an appropriate site rental is $145.00 per site per week.
In my view, this amount should be increased to $147.00 per site per week to acknowledge the increase in expenses incurred by the park owners which go beyond increases in the Consumer Price Index.
In coming to this conclusion, I do so on the basis that the bowling green is decommissioned and not available for use.
Orders
The site rent increase effective from 4 October 2012 is reduced from $160 per site per week to $147 per site per week.
The respondent must refund to the applicants any overpayment of the site rent since when the increased site rent has been paid.