Bailey v Kismet Riverside Pty Ltd

[2025] NSWCATCD 56

Civil and Administrative Tribunal

New South Wales

Medium Neutral Citation:

Bailey v Kismet Riverside Pty Ltd [2025] NSWCATCD 56

Hearing dates:

9 December 2024; 11 February 2025

Date of orders:

24 June 2025

Decision date:

24 June 2025

Jurisdiction:

Consumer and Commercial Division

Before:

M McFarlane, General Member

Decision:

1.   The Applicants have not established their case to the required standard of proof.

2.   Application dismissed after hearing.

Catchwords:

Excessive Site Fees; Residential Community

Legislation Cited:

Residential (Land lease) Communities Act 2013 NSW, section 37, 67, 71, 73 and 74.

Cases Cited:

Edmonds v Paultrus Pty Ltd [2016] NSWCATCD 55

Category:

Principal judgment

Parties:

M Bailey and E Gale as representatives for homeowners- Applicant

Kismet Riverside Pty Ltd- Respondent

Representation:

M Bailey and E Gale as representatives for homeowners- Applicant

Kismet Riverside Pty Ltd- Respondent

File Number(s):

2024/00044801

REASONS FOR DECISION

Application

1. The Applicants lodged a collective application under s71 of the Residential (Land Lease) Communities Act (‘the Act’) seeking orders as follows

1. s73(1)(a) an order declaring that an increase in site fees is excessive,

2. s73(1)(c) an order setting aside the increase,

3. s73(1)(f) any ancillary order that the Tribunal, in the circumstances, thinks appropriate

4. s37(2)(c)(ii) an order that the operator pay compensation to the home owner and any other home owners, and

5. s37(2)(c)(iii) any ancillary order that the Tribunal, in the circumstances, thinks appropriate.

2. The primary purpose of the proceedings was to have the Tribunal determine whether the Site Fee Notice issued to the Applicant’s dated 5 December 2023 was excessive. The effect of this notice was a site increase of $12 per fortnight for all residential sites.

Proceedings

3. The proceedings proceeded to compulsory mediation on 23 January 2024, with the parties unable to reach an agreement as to the terms of mediation, resulting in correspondence dated 25 January 2024 issued by NSW Fair Trading confirming mediation was unsuccessful. This correspondence forms part of the Tribunal file and originating Application.

4. Application was lodged with the Tribunal on 5 February 2024.

5. As at the time the mediation proceeded, the Applicants purported to represent 17 of the 39 residents in the land lease community. This list was not provided to the Tribunal until the matter was listed for contested hearing on 27 August 2025. The matter was unable to proceed on that occasion due to the Applicant having difficulty participating in the hearing by virtual hearing room. The matter was adjourned and ultimately commenced the contested hearing process on 9 December 2024 in an in-person hearing environment.

6. By the time the final contested hearing commenced on 9 December 2024, the Applicants represented a total of 3 sites and occupants of the land lease community (‘the residents’) with the remaining residents having opted out of the collective proceedings.

7. The Residential community is located within a mixed park including holiday sites, residential land lease sites, a function room, park facilities and motel accommodation.

8. During the course of the proceedings, considerable information and background to the relationship between the Applicant Mr Bailey as a past operator of the Park, and the Respondents has been filed. Some evidence assists the Tribunal in determining s 74 matters such as past site increases applied in the Park, or the Local Council rates at an earlier time as well as providing some context to operator responsibilities pursuant to s 37 of the Act. Material outside of these factors has been disregarded in determining the issues arising in this Application.

Jurisdiction

9. The Tribunal has jurisdiction to hear and determine the application noting it was filed within the required 14 day timeframe following a failed mediation pursuant to section 71 of the Act. Section 73 provides that the Tribunal is authorised to hear and determine excessive fee disputes.

Evidence

10. The hearing proceeded over two days on 9 December 2024 with unfortunate and distressing circumstances for both parties intervening to prevent the matter proceeding to conclusion on that day, with the matter then proceeding to finalise on a part-heard basis on 11 February 2025. The Tribunal acknowledges and appreciates the effort the parties have put into both preparing their evidence thoroughly and conducting themselves with courtesy and patience throughout the proceedings.

11. During the course of the proceedings both parties filed and served comprehensive written material to support their respective positions. The documentary form of evidence was then supplemented by oral submissions and evidence provided in the hearing across the two hearing dates. In addition, both parties assisted the Tribunal on 11 February 2025 by providing written submissions and a summary of the important points they wished to draw to the attention of the Tribunal prior to the matter proceeding to final determination.

12. Material filed on behalf of the Applicant included confirmation of unsuccessful mediation correspondence, caselaw, profit and loss statement and combined cost explanations given to residents in support of site fee increase, electricity bill, rainfall, chronology of significant events, resident submissions, CPI data, Council correspondence, site fee increase notices December 2022 and December 2023, roadworks correspondence, site agreement for Site 55 occupied by Mr & Mrs Bailey, pictures of common areas and roads, documentation responding to material filed by the Operator, comparison table prepared regarding increased costs accepted by the Applicants as compared to those where the Applicants indicate insufficient information or evidence has been supplied or costs are ‘one off’ and should not be borne by the residents. This table calculated a fortnightly increase in costs of $5.92 per site. At the final hearing date the Applicants orally provided an amended calculation of $3.16 per fortnight after removing what they considered to be ‘one off’ costs and CPI calculations on wages.

13. Material filed on behalf of the Respondent operator included a bundle containing background information, chronology of significant events, correspondence and documentation relating to the Respondent’s purchase of the Park, witness statements and photographs related to park facilities, site fee increase notices, profit and loss calculations, invoices supplied to provide further detail to supplement the site fee increase notices, occupancy reports, copies of community rules, documentation to support park work including Starlink, Celfi, solar lights, grading of roads, tree maintenance, potable water improves, park recreation facility improvements, fire fighting equipment purchased, quotes for further work planned, insurance quotations, electricity accounts, valuer generals land valuation notice, CPI for September 2023.

14. Only the site agreement for Mr & Mrs Bailey was provided in the evidence filed by the parties. The parties did not dispute that the remaining two site occupants disputing the site increase notice also hold valid site agreements. Ms Gale supported Mr Bailey in presenting the Applicant’s evidence, with the remaining resident disputing the Site increase fee present as an observer during the Tribunal proceedings. On this basis the Tribunal is satisfied that the Applicants were duly instructed by and authorised to represent the 3 sites disputing the Notice of Site Fee Increase. The remaining residents are taken as having ‘opted out’ of the proceedings by the Tribunal.

15. Submissions made by the Applicant in support of the Site Increase Notice being excessive included that that the Respondent had not been in occupation of the Park for a sufficient length of time to accurately calculate or determine the additional operating expenses, that the increase in site fees was not appropriately apportioned between the balance of the Park including holiday and motel style accommodation and the residents, that estimates of park work including road ways was not sufficient to justify the increase in cost and a number of expenses, including a defibrillator were ‘one off’ expenses or capital works rather than increased operating costs that should appropriately be borne by the Residents.

16. Since commencement of the proceedings, the Respondent has sought to provide additional information to the Residents to explain the basis of the site fee increase set. This included taking into account a number of items and concerns raised by residents and in relation to the additional costs included in the Notice of Increased Site fees. The respondents removed some items from operating costs calculations, provided detailed profit and loss statements prepared by their Accountant, disclosing the calculation based on CPI was slightly higher than the amount selected, as well as being open to considering other methods of apportioning expenses across the Park between the residents and other uses. All methods calculated by the Respondent during the proceedings reflect that the $12 per fortnight site fee increase proposed is less than the actual increased operating costs applicable to the relevant period.

Relevant Legislation

17. Section 73 of the Act provides as follows:

73   Orders as to excessive increases in site fees

(1) The Tribunal may, on application under section 71 or 72, make any of the following orders—

(a)  an order declaring that an increase in site fees is excessive,

(b)  an order reducing the amount of the increase by a specified    amount,

(c)  an order setting aside the increase,

(d)  an order that the site fees must not exceed a specified amount or specified amounts, either—

(i)  from a specified day, not being earlier than the day from which the increased site fees were payable, or

(ii)  during a specified period,

(e)  an order confirming the increase on the conditions (if any) that the Tribunal considers appropriate,

(f)  any ancillary order that the Tribunal, in the circumstances, thinks appropriate.

(2)  The Tribunal may make orders applying to individual participating home owners, groups of participating home owners or all participating home owners.

(3)  An order applies to all affected home owners in the community (other than those who opt out), unless the Tribunal is satisfied there is a strong reason for making separate orders for different home owners or groups of home owners.

(4)  The Tribunal cannot make an order that would result in an increase lower than that needed to cover any actual or projected increase (established to the satisfaction of the Tribunal) in the outgoings and operating expenses for the community since the previous increase (if any) in site fees for the community.

18. Section 74 of the Act provides as follows,

1. Matters to be considered about excessive increases

(1) The Tribunal may have regard to any or all of the following factors when deciding whether to make an order under section 73—

(a)  the frequency and amount of past increases in site fees for the community,

(b)  any actual or projected increase in the outgoings and operating expenses for the community as provided by the operator since the previous increase (if any) in site fees for the community,

(c)  any repairs or improvements to the community—

(i)  carried out by the operator since the previous increase (if any), or

(ii)  planned by the operator for the period covered by the increase being reviewed,

(d)  the general condition of the community including its common areas,

(e)  the range and average level of site fees within the community,

(f)    (Repealed)

(g)  the value of any improvements to the community (including common areas) paid for or carried out by home owners,

(h)  any explanation for the increase provided by the operator by notice in writing to the affected home owners,

(i)  variations in the Consumer Price Index (All Groups Index) for Sydney,

(j)  whether the increase is fair and equitable in the operation of the community,

(k)  any other matters prescribed by the regulations.

(2) The regulations may require the Tribunal to disregard any specified matters (not being a matter referred to in subsection (1)), in any specified circumstances, when deciding whether to make an order under section 73.

19. Section 67 of the Act sets out the requirements for an Increase in Site Fees by Notice:

67   Increase of site fees by notice

(1)  This section applies to a site agreement that provides for the increase of the site fees by notice (otherwise than by a fixed method).

(2)  An increase in the site fees is not payable unless the fees are increased in accordance with this section.

(3)  The site fees must not be increased except by notice in writing given to all the home owners in the same community at the same time under site agreements to which this section applies.

(4)  The notice must—

(a)  specify the amount of the increased site fees, and

(b)  specify the day (the effective day) on and from which the increased site fees are payable, and

(c)  include an explanation for the increase, and

(d)  include such other information as may be prescribed by the regulations, and

(e)  if the increase in site fees is wholly or partly attributable to the increase in the cost of specific items—

(i)  include details of the items, and

(ii)  include details of the increase in the cost of the items since the previous increase in site fees, and

(iii)  include details of how the operator has apportioned the costs for the relevant items when calculating the increased site fees, and

(f)  be in the approved form, if any.

(5)  The day specified as the effective day must not be earlier than 60 days after the day on which the notice was given.

(6)  Site fees must not be increased more than once in any 12-month period under this section. This is calculated by reference to the day from which the increased site fees are payable.

(7)  Increases under this section in site fees payable by home owners in the same community under site agreements to which this section applies must take effect on the same day (and not on different days).

(8)  A notice under this section may be cancelled.

(9)  A later notice may provide for a lesser increase than that specified in an earlier notice under this section. A later notice has effect instead of the earlier notice and takes effect from the date on which the earlier notice was to take effect.

(10)  If the site fees payable under a site agreement are increased under this section, the terms of the agreement are varied accordingly.

(11)  If a person becomes a home owner after a notice has been given under this section to other home owners in the community but before the date the increase takes effect—

(a)  the operator must notify the home owner of the notice and its contents and effect, and

(b)  the increase applies as if the notice had been given to the home owner at the same time as it was given to other home owners.

Findings

20. In respect of the site notice requirements as out in section 67 of the Act:

1. The Applicant’s raised the variation of service method throughout the Community with some notices delivered to the mailbox at the Park, with others delivered by email or to post to the site owner’s primary residential addresses and sought a declaration that the notice was invalid on the basis that the preferred method of service was not complied with, or that the Notices were not effective as the Notices were not issued to the community simultaneously.

2. The Applicant relied upon a hand written note made by a resident on a Notice indicating the Notice was received by them on 8 December 2025 in asserting the 60 day notice timeframe had not been met.

3. The Tribunal considers the relevant date for the Notice to be 5 December 2025, with the relevant timeframes for effective service dates running from that date depending on the method of service. The increased site fees were taken to come into effect from 14 February 2024. Even allowing for postal service, the Tribunal is satisfied that the Notice provided greater than 60 days as required by section 67(5) of the Act.

4. There is insufficient evidence provided to the Tribunal in relation to various resident’s preferred or nominated method of service to make any finding that notices were issued other than in accordance with the service form nominated by the relevant site owners.

5. The Tribunal does not accept that the Legislation requires that all notices must be delivered at an identical time to all residents- e.g. Applicant submitted that if some notices posted, and some emailed according to site owner preference, the emails should not issue until such time as the notices posted were deemed received.

6. The purpose of a site increase notice is to inform residents of increase in site fees as set out in the Act.

7. In this case notice was received by the Applicants, enabling them to proceed with a Collective Application through both the mediation and Tribunal process to ensure whether the site fees were excessive could be considered and adjudicated on by the Tribunal.

8. The Site increase notice must contain sufficient information to provide the basis on which the proposed site increase was calculated and required. This component of the Notice requirements and Tribunal findings will be outlined in further detail below.

9. Whilst throughout these proceedings, the Applicants have sought further from the Respondents, who have obliged in providing further details, invoices, profit and loss statements and variation of calculations to meet Resident’s concerns in respect of the calculated increase, the Tribunal was satisfied in this instance that sufficient information was provided to the Residents to explain the basis for the calculation of the site increase within the Notice.

10. The Tribunal notes that as per Edmonds v Paultrus Pty Ltd [2016] NSWCATCD 55, it is necessary to disclose an explanation for the increased within the Notice. There is no minimum amount of detail or particular form required.

11. Having carefully considered the Notice issued in this case the Tribunal is satisfied the information contained within the Notice of Site Increase was sufficient as it outlines sufficient detail to provide an explanation of the site increase calculated.

12. The Tribunal is satisfied the Notice of site increase is a valid notice as required by 67 of the Act.

13. It is therefore necessary to consider the matters raised in s74 as being relevant to determining whether the increase is ‘excessive’.

21. Turning to s 74 considerations, the Tribunal holds the discretion or “may” have regard to any or all factors set out in this section when deciding whether to make an order under section 73. In determining this matter, the Tribunal has had regard to evidence in respect of the following matters as relevant to these proceedings:

1. Past site increases and intervals

1. It was not in dispute that the following past site increases have taken place on an annual basis:

1. January 2018- $5 per week

2. January 2019- $5 per week

3. January 2020- $5 per week

4. January 2021- $6 per week

5. January 2022- $5 per week

6. February 2023- $7 per week

2. The current Notice of Site increase proposing to take effect in February 2024- proposed at $6 per week appears to fit within the past annual increases applicable to the Community.

2. Actual/projected increase in outgoings and operating expenses since previous increase in site fees; Repairs or improvements carried out or planned for the period covered by the increase being reviewed; the general condition of the community including its common areas

1. Having regard to the totality of the evidence submitted by both parties throughout these proceedings, the Tribunal is satisfied the Respondent is actively taking steps to fulfil their responsibilities pursuant to s37 of the Act, including providing a reasonably safe and secure community and maintaining or improving the property to ensure it meets the operation requirements set by the Local Council or Statutory Authority who provides the planning permissions to operate.

1. Whilst some increased expenses such as ‘roads’ may have relied upon estimates of work to be done, s74 (c)(ii) allows the Tribunal to review repairs or improvements to the community ‘planned’ for the period covered by the increase. Roads are an important part of providing access to resident’s sites, are important to the planning approvals for the site, and likewise are raised as an important part of the resident’s concerns in respect of the general conditions of the community.

2. Rates have increased, as has the Valuer General’s valuation for the unimproved land value.

3. The Respondent’s material sets out a number of capital improvements they have undertaken to improve services, safety and facilities at the community which do not form part of the increased site fees proposed by the Notice.

3. The range and average level of site fees within the community

1. The respondents evidence advises that site fees are set based on area occupied by the resident, however the Notice issued set a fixed amount per site rather than being calculated in accordance with the size of site occupied by the resident.

4. Any explanation for the increase provided by the operator by notice in writing to the affected home owners

The Notice contained what the Respondents referred to as a ‘snapshot’ of information relating to increased annual extraordinary expenses incurred including Council rates increase, insurance premium cost, water treatment, roads, onsite fire fighting unit, defibrillator, fuel and wages increase calculated at CPI of 5.8% resulting in an increase in costs of $20.53 per fortnight. This was calculated on the basis of 110 total sites within the park (including holiday/tourist sites).

The notice reflected site fees would increase by $12, rather than the higher amount.

The Tribunal determined that the notice was valid for the purposes of s67 of the Act, as it does contain an explanation of the increased expenses considered in arriving at the site increase.

5. Variations in the CPI (All Groups Index) for Sydney

As at the date of issue of the Notice of Site Fee increase, the most recent CPI information available as at the date the Notice was issued were calculated for the year September 2022- September 2023 listing Sydney’s CPI at 5.6%. December 2022- December 2023 CPI figures were released as at 31 January 2024 and resulted in an outcome of 4.2%. 2022-2023 Financial Year figures for Sydney resulted in an outcome of 7.2%.

Utilising Mr Bailey’s site fees were $236.60 prior to the Notice, this would equates to $13.25 per fortnight, $9.93 per fortnight and $17.03 respectively dependent on the figure selected, with only the September annual figure and the 2023-2023 financial year figures available as at the date the Notice of Site Increase was issued.

6. Whether the increase is fair and equitable in the operation of the community

1. It is appropriate to consider factors such as the number of residential sites, as compared to tourist or holiday sites, as well as alternative accommodation offerings contained within the Park when calculating the proportion of additional expenses applicable to the Residential Community.

2. Likewise, the number of nights and facilities on offer to the Residential Community, as compared to occupation rates of tourist or holiday sites are also relevant matters to weigh up.

3. In circumstances where the Accountant preparing the financial documentation has authenticated the financial profit and loss material available in Tribunal proceedings, and calculation of increased expenses across a variety of calculation methods results in an increased operating cost amount higher than the $12 per fortnight sought to be claimed by the Respondents, this evidence does not support the Applicant’s claim the site increase is excessive.

22. The Tribunal has also considered the obligation when considering this Application set out in S 73(4) which provides that “the Tribunal cannot make an order that would result in an increase lower than that needed to cover any actual or projected increase (established to the satisfaction of the Tribunal)… in the outgoings and operating expenses for the community since the previous increase… in site fees for the community.”

23. In all of the circumstances of this matter, despite the Respondent’s actual and projected calculations all exceeding Notice of Site Fee Increase dated 5 December 2023, the Tribunal has determined it is unable to establish to a single determinate figure on the material available in these proceedings to the Tribunal’s required satisfaction to enable the Tribunal to accurately determine an appropriate site fee increase sufficient to meet the outgoings and operating expenses.

24. The Tribunal has determined it is not appropriate to make an order setting aside the Notice of Site Fee Increase dated 5 December 2023 in these particular proceedings in circumstances where it has determined the Notice was not excessive and it appears the Respondent had sought to increase site fees in a manner that appears to be in line with ‘fair and equitable’ considerations outlined in s74. In addition, it is a relevant factor that only 3 sites are contesting the Notice of Site Fee Increase was excessive.

Orders

25. The application is dismissed after hearing.

26. The Tribunal is not satisfied on balance that the Notice of Increase of site fees dated 5 December 2023 issued by the Respondent are excessive for the reasons outlined in this decision.

**********

I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales.

Registrar

Decision last updated: 15 August 2025