Hart v Walter Elliott Holdings Pty Ltd trading as Palm Lake Resort

[2018] QCAT 211

QUEENSLAND CIVIL AND
ADMINISTRATIVE TRIBUNAL

CITATION:

Hart & Anor v Walter Elliott Holdings Pty Ltd trading as Palm Lake Resort [2018] QCAT 211

PARTIES:

STEPHEN SYDNEY HART
and
DEBORAH JEAN HART
(applicants)

v

WALTER ELLIOTT HOLDINGS PTY LTD TRADING AS PALM LAKE RESORT

(respondent)

APPLICATION NO/S:

OCL059-17

MATTER TYPE:

Other civil dispute matters

DELIVERED ON:

9 July 2018

HEARING DATE:

On the papers

HEARD AT:

Brisbane

DECISION OF:

Member Kanowski

ORDERS:

1.   The rules in the Palm Lake Resort document headed Hervey Bay Residential Park Rules; Manufactured Homes (Residential Parks) Act 2003; July 2017 are of no effect.

2.   The following rules in the Palm Lake Resort document headed Hervey Bay Residential Park Rules; Manufactured Homes (Residential Parks) Act 2003; August 2017 are invalid: 3, 4, 6, 7, 8, 11, 12.1, 13, 15, 18, 19 and 20.

CATCHWORDS:

ENVIRONMENT AND PLANNING – ENVIRONMENTAL PLANNING – DEVELOPMENT CONTROL – CONTROL OF PARTICULAR MATTERS – RESIDENTIAL – CARAVAN PARKS AND MOVEABLE DWELLINGS – whether park rules effectively changed – whether park rules valid

Manufactured Homes (Residential Parks) Act 2003 (Qld), s 77, s 78, s 82, s 85, s 140

REPRESENTATION:

Applicants:

Self-represented

Respondent:

A Clements, Human Resources Manager of Walter Elliott Holdings Pty Ltd

APPEARANCES:

This matter was heard and determined on the papers pursuant to section 32 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld).

REASONS FOR DECISION

Introduction

1. Mr and Mrs Hart live at Palm Lake Resort Hervey Bay. This case is about whether they are subject to park rules introduced in 2017 by the park owner Walter Elliott Holdings Pty Ltd trading as Palm Lake Resort (‘Palm Lake’).

2. The resort is a residential park to which the Manufactured Homes (Residential Parks) Act 2003 (Qld) (‘Manufactured Homes Act’) applies. The Act regulates how park rules can be made and changed. Mr and Mrs Hart argue that Palm Lake did not follow the required procedure in introducing a new set of rules in 2017, and that some of the rules in question relate to matters not authorised under the Act.

3. Palm Lake, in response, argues that QCAT does not have jurisdiction to hear the matter and that, in any event, the rules are valid.

   Legislation

4. Part 13 of the Manufactured Homes Act deals with park rules. Section 77 says:

   77     Park owner may make park rules

   (1)     The park owner for a residential park for which site agreements are in force may make rules about the use, enjoyment, control and management of the park.

   (2)     However, rules may be made only about—

   (a) the use and operation of the communal facilities; and

   (b) the making and abatement of noise; and

   (c) the carrying on of sporting and other recreational activities; and

   (d) the speed limits for motor vehicles; and

   (e) the parking of motor vehicles; and

   (f) the disposal of refuse; and

   (g) the keeping of pets; and

   (h) other things prescribed under a regulation.

5. In relation to paragraph (h), I note that no things have been prescribed under the relevant regulations: the Manufactured Homes (Residential Parks) Regulation 2003 (Qld) or the Manufactured Homes (Residential Parks) Regulation 2017 (Qld), which commenced operation on 1 September 2017 with the exception of one section which commenced operation on 1 October 2017.

6. Sections 78 to 85 of the Manufactured Homes Act then deal with park rule changes. The park owner must follow a procedure in order to effectively change park rules. In summary, the park owner must notify each homeowner of the proposed change, informing them that they may object to the proposal before the ‘objection closing day’, which must be at least 28 days in the future. If at least five homeowners object, then a park liaison committee must be formed. (A different requirement applies if the park has less than 10 residents, but that is not relevant here). The committee must decide whether the proposal is reasonable. There is then a right of review by QCAT. If the matter comes to QCAT, the tribunal must decide whether the proposal is reasonable.

7. The date on which a proposed change will come into effect, and whether the proposal will be modified, will depend on whether there are at least five objections, any rulings by a park liaison committee, QCAT reviews, and so on.

8. A change of park rule has no effect, relevantly, if it is made otherwise than ‘under this Division’:[1] that is, in accordance with the procedure outlined above.

   [1]Manufactured Homes (Residential Parks) Act 2003 (Qld), s 85(1)(a).

9. The park rules from time to time are taken to be included as terms of all site agreements in the park.[2]

   [2]Ibid s 19(c).

   History of the matter

10. The documents provided by the parties show that in May 2017 Palm Lake proposed a new set of park rules headed Hervey Bay Residential Park Rules; Manufactured Homes (Residential Parks) Act 2003; July 2017 (‘the July 2017 version’). Palm Lake sent the July 2017 version to the residents’ association on 31 May 2017 but, it appears, not directly to homeowners. The letter from Palm Lake to homeowners dated 31 May 2017 did not specify an objection closing day, did not clearly indicate that homeowners could object to the proposed rules, and did not indicate how a homeowner could object.

11. Over the next few months there was quite a lot of communication by email about the rules between Palm Lake and, variously, the residents’ association, the caretaker, and Mr and Mrs Hart. Palm Lake agreed to make some changes to the proposed rules, but declined to make others.

12. On 30 August 2017 Mr and Mrs Hart applied to QCAT for various orders designed to remedy what they saw as defects in the process used by Palm Lake.

13. On 25 September 2017 Palm Lake wrote to homeowners, conceding that it had not met ‘the exact specification’ of the Manufactured Homes Act for changing the rules. It attached a proposed set of rules headed Hervey Bay Residential Park Rules; Manufactured Homes (Residential Parks) Act 2003; August 2017 (‘the August 2017 version’). At a glance, the August 2017 version appears to be identical to the July 2017 version. Palm Lake’s letters advised that homeowners could object to the proposal by the objection closing day of 23 October 2017 by emailing a particular staff member of Palm Lake.

14. According to Palm Lake, only one objection – by Mr and Mrs Hart – was lodged in response to the letters of 25 September 2017. I accept that evidence.

    Does QCAT have jurisdiction?

15. Palm Lake argues that QCAT does not have jurisdiction to deal with Mr and Mrs Hart’s application, as section 82 of the Manufactured Homes Act permits an application to QCAT only if there are at least five homeowner applicants.

16. In my view section 82 does not have that effect. As I read the section, it somewhat curiously allows an application by a single homeowner or a ‘single application’ by (relevantly) at least five homeowners. However, in my view it is not section 82 that permits Mr and Mrs Hart to bring their application. Section 82 is part of the process under which a homeowner can object to a proposal for a rule change and then, after a park liaison committee has been formed and carried out its functions, apply to QCAT.

17. That process was not triggered at any point. There were never enough objections. Perhaps there would have been had Palm Lake’s letters to homeowners dated 31 May 2017 complied with section 78 of the Manufactured Homes Act, so that the homeowners were properly informed of the proposal and their individual objection rights. However, that did not occur.

18. Nonetheless, in my view Mr and Mrs Hart are entitled to pursue their application to QCAT under a different route. Under section 140 of the Manufactured Homes Act, a party to a ‘site agreement dispute’ may apply to QCAT for an order. ‘Site agreement dispute’ includes a dispute between parties to a site agreement about their rights and obligations under the agreement.[3] As mentioned earlier, park rules are taken to be included as terms of a site agreement.[4] It is apparent that Mr and Mrs Hart on the one hand and Palm Lake on the other disagree about whether the August 2017 version applies to Mr and Mrs Hart (and, for that matter, to other homeowners). They also disagree about whether particular rules are valid under section 77 of the Manufactured Homes Act.

    [3]Ibid s 14A(1)(a).

    [4]Ibid s 19(c).

19. It is probable that Palm Lake would, if asked, concede that the July 2017 version is not effective. However, as this concession has not been sought or expressly made, I will proceed on the basis that there remains a dispute between the parties about whether the July 2017 version is effective.

20. I am therefore of the view that there are site agreement disputes between Palm Lake and Mr and Mrs Hart, and so QCAT has jurisdiction under section 140 of the Manufactured Homes Act.

21. I will consider whether the new versions of the park rules were correctly introduced under the rule change procedure outlined above, and whether particular rules are valid under section 77.

    Does the July 2017 version apply to Mr and Mrs Hart?

22. The letters that Palm Lake sent to homeowners dated 31 May 2017 were deficient in a number of respects. They failed to specify an objection closing day, and they did not explain how to object. In fact they did not clearly indicate that homeowners could object. In these respects the letters did not comply with section 78 of the Manufactured Homes Act.

23. A change to park rules has no effect if it is made otherwise than under Division 2 of Part 13 of the Manufactured Homes Act.[5] That Division includes section 78. As the July 2017 version was not introduced by Palm Lake in the required way, that version of the rules has no effect.

    Does the August 2017 version apply to Mr and Mrs Hart (to the extent that the rules are within the scope of section 77)?

    [5]Ibid s 85(1)(a).

24. As mentioned earlier, Palm Lake sent this version to homeowners by letters dated 25 September 2017.

25. In their statement of evidence, Mr and Mrs Hart draw attention to the tone and content of those letters, which in Mr and Mrs Hart’s view ‘implied that there were no problems and used wording that suggested homeowners should ignore the process as it was purely administrative’. I accept that the letters downplayed the previous lack of procedural compliance, and emphasised Palm Lake’s view that the changes were ones of style rather than substance. On the other hand, the letters attached the August 2017 version and did notify homeowners of their right to object to the new rules.

26. Mr and Mrs Hart also observe that Palm Lake’s correspondence did not identify or explain the changes (beyond referring to improvements in presentation).

27. While the obligation in section 78 of the Manufactured Homes Act is to notify homeowners of a proposed change, it is unlikely that Parliament intended that a park owner would have explain how a new rule differs from an existing rule. Palm Lake’s letters of 25 September 2017 did indicate that the August 2017 version contained new rules, and did involve changes to the existing rules. Improvements in style were mentioned, but it was not stated that these were the only changes.

28. There is no particular form of notice prescribed for section 78, and the letters sent by Palm Lake on 25 September 2017 did meet the minimum requirements of the section. Conceivably, comments included in a section 78 notice could be so misleading as to neutralise the required message, but I do not consider that the comments in this case were of that character.

29. Accordingly, I find that the letters sent on 25 September 2017 were valid notices under section 78.

30. As there were not at least five objections, the August 2017 version came into effect at the end of 23 October 2017, which was the objections closing day.[6] The rules in the August 2017 version therefore apply to Mr and Mrs Hart, except for any rules which are not valid under section 77 of the Manufactured Homes Act.

    [6]Ibid s 84(2)(a).

Are the rules in the August 2017 version valid?

1. Mr and Mrs Hart argue that several of the rules are invalid on the basis that they fall outside the scope of section 77 of the Manufactured Homes Act, which is quoted in paragraph 4 above. I will consider each of the disputed rules below.

   Rule 1: Alcohol

2. This rule limits the consumption of alcohol to the resort clubhouse, barbeque areas and at functions organised with the caretaker’s consent. It prohibits consumption in resort streets (unless approved by the caretaker), pool areas, and in other than designated buildings. It also seeks (unnecessarily) to require compliance with any liquor licences, and to prohibit the supply of alcohol at licensed premises to people other than residents and their guests.  

3. Mr and Mrs Hart have not explained why they think this rule is invalid.

4. In my view, on the reasonable assumption that the rule is intended only to apply in communal areas rather than in homes, it is within the scope of the power in section 77(2)(a) to make rules about the use and operation of the communal facilities. ‘Communal facilities’ is not exhaustively defined in the Schedule to the Manufactured Homes Act, and I consider that the term could reasonably cover roads.

5. I consider that rule 1 is valid.

   Rule 3: Annoying or Injurious Conduct

6. This rule provides that homeowners must not do anything which through noise, odour, vibrations or otherwise may annoy homeowners or occupiers of neighbouring sites, and must not permit family members, visitors etc. to do likewise. Further, it goes on ‘without limiting the generality of the prohibition’ to impose a number of specific noise restrictions. Finally, it requires people to conduct themselves in an appropriate manner within communal facilities etc.

7. Mr and Mrs Hart argue that the subject matter of this rule is ‘not in the Act’. Palm Lake argues that the rule is authorised by sections 77(2)(b) and 105(2)(a) of the Manufactured Homes Act, and section 19 of the Work Health and Safety Act 2011 (Qld) (‘Work Health and Safety Act’). It is apparent from Palm Lake’s statement of evidence that it understands ‘regulation’ in section 77(2)(h) to include a provision in the Manufactured Homes Act or any other Act. In my view, this is misconceived. The expression ‘things prescribed under a regulation’ or similar expressions are used in many Acts, and are invariably understood to refer to matters prescribed by a regulation made under the Act in question. In the case of the Manufactured Homes Act, the regulation in question would have to be a regulation made pursuant to the regulation-making power in section 146 of the Manufactured Homes Act. As mentioned in paragraph 5 above, there is a set of regulations made under the Act, and a former set. Neither has prescribed things for the purposes of section 77(2)(h).

8. So the reliance by Palm Lake on section 105(2)(a) of the Manufactured Homes Act and section 19 of the Work Health and Safety Act is misplaced. I do accept that section 77(2)(b) is relevant, and to that could be added section 77(2)(a). However, rule 3 goes well beyond what is authorised by those provisions. For example, there is nothing in section 77 which permits a rule to prohibit vibrations and odours that may annoy the occupants of a neighbouring site. That is not to say that there could be no consequences for a homeowner who created such an annoyance. Section 105(2)(a) of the Manufactured Homes Act prohibits unreasonable interference by a homeowner with the comfort of another resident. However, such interference is not a permitted topic for a park rule.

9. It is not practical for me to go through lengthy rules such as rule 3 and select particular passages which might be valid. Such rules are presented as single numbered rules and should, to be valid, be authorised under section 77 in their entirety.

10. I consider that rule 3 is invalid.  

    Rule 4: Appearance of Homes

11. This rule requires homeowners to maintain their gardens, keep windows clean, not install shades or satellite dishes without approval, and so on.

12. None of these topics is authorised under section 77. Palm Lake relies on section 16(g) of the Manufactured Homes Act but, as previously explained, other sections of the Manufactured Homes Act cannot be relied on as authority for park rules.

13. I consider that rule 4 is invalid.

    Rule 6: Boat Ramps

14. Rule 6 is headed ‘Boat Ramps’ and the only text that follows is ‘Not Applicable’. ‘Rule’ is a misnomer here. Rule 6 is a pointless statement that has no place in a set of park rules.

15. I consider that rule 6 is invalid.

    Rule 7: Complaint Procedure

16. Amongst other things, this rule requires complaints to be in writing. The only submission made by Palm Lake about this rule is: ‘Advice of how to make complaint regarding any breach of Park Rules’. This does not explain how the rule is permitted under section 77. Clearly it is not.

17. I consider that rule 7 is invalid.

    Rule 8: Emergency Call Alert

18. This rule contains advice on what to do in an emergency. Palm Lake seeks to justify it under various legislative provisions other than section 77 but, as explained earlier, that approach is misconceived.

19. Rule 8 is advice rather than a rule. Further, the subject matter is not within section 77.

20. I consider that rule 8 is invalid.

    Rule 10: Garbage

21. This rule requires homeowners to keep bins out of sight except on collection days. It also places weight restrictions on bins and requires sharp objects to be carefully wrapped. Finally, it prohibits the burning of waste in any part of the resort including at homes.

22. Mr and Mrs Hart say this rule is invalid but do not explain why.

23. Palm Lake submits, correctly in my view, that the rule is authorised under section 77(2)(f). The requirement to keep bins out of sight within park sites is perhaps of borderline validity, but on balance I consider it is connected closely enough to the topic of the disposal of refuse.

24. I consider that rule 10 is valid.

    Rule 11: Gate

25. This rule says that ‘the gates will be opened and closed as per current nominated times; these times may be amended as required by management’. It goes on to say that entry to the resort when the gates are closed is restricted. I am not sure what is meant by that.

26. Mr and Mrs Hart say that the rule is invalid but do not explain why.

27. Palm Lake submits that the rule is authorised under section 77(2)(a). I accept that this provision would permit a park owner to make a rule about the opening times for gates and similar matters. However, in my view there is a problem with Rule 11. It authorises ‘management’ to change an aspect of the rule at its discretion. As has been explained, any change to park rules must be introduced using the procedure in Division 2 of Part 13 of the Manufactured Homes Act.

28. As this feature of rule 11 offends against a requirement of the Manufactured Homes Act, I consider that rule 11 is invalid.

    Rule 12.1: Milon Gym

29. This is similar to rule 6: the only text is ‘Not Applicable’. For the same reasons, I consider it is invalid.

    Rule 13: House Sitting

30. This rule requires homeowners who wish to engage a house sitter to comply with the ‘House Sitter Policy’ which is available from the caretaker.

31. Palm Lake submits that the rule is authorised under section 77(2)(a). That provision permits rules about the use and operation of the communal facilities. It is not obvious what the suggested connection is: perhaps the policy regulates the use of communal facilities by house sitters? In any event, any authorised rules that the park owner wishes to introduce should be included in the park rules, not in some other document that is only available upon request and liable to unilateral alteration.

32. I consider that rule 13 is invalid.

Rule 14: Pets

1. This rule provides that a homeowner may be granted permission to keep one pet, being a bird, dog, or cat. The rule goes on to impose requirements about gaining prior permission, neutering, control of animals, and so on.

1. Mr and Mrs Hart submit: ‘Number of pets is in site agreements – Invalid Rule’.

2. Palm Lake submits that the rule is authorised by section 77(2)(g). In my view that is clearly correct. I appreciate that difficulties could arise if there were inconsistencies between the terms of individual site agreements and park rules. However the topic is clearly an appropriate one for park rules.

3. I consider that rule 14 is valid.

   Rule 15: Resort Environment

4. This rule prohibits homeowners from using their sites for illegal purposes, displaying placards on their homes or sites, parking in unauthorised spots, and so on.

5. Palm Lake relies on section 77(2)(e) as well as other provisions in the Manufactured Homes Act and the Work Health and Safety Act.

6. As previously discussed, authorisation can only come from section 77 itself. While the parking aspects of the rule would be authorised by section 77(2)(e), the rule as a whole exceeds what is authorised by section 77.

7. I consider that rule 15 is invalid.

   Rule 18: Rules

8. This rule says that the park owner may introduce new rules for certain purposes.

9. Mr and Mrs Hart argue that this rule is invalid as it implicitly allows management to change rules without consultation.

10. Palm Lake responds that there is nothing to indicate that required processes would not be complied with.

11. I accept Mr and Mrs Hart’s submission. In any event, the topic of rule-making procedure is not one authorised by section 77.

12. I consider that rule 18 is invalid.

    Rule 19: Security

13. This rule requires homeowners to advise the caretaker immediately if they become aware of any trespassing, vandalism or neglect of the resort or homes, or theft of any resort or homeowner’s property. The rule also says that any CCTV images will be managed as per the resort’s privacy policy which can be accessed at a stated website.

14. Mr and Mrs Hart submit that CCTV and privacy issues are matters of company policy rather than rules, and that there is no CCTV except at the entrance gate for use by residents to admit visitors.

15. Palm Lake can point only to provisions in other Acts.

16. At best the rule is only partly authorised under section 77, in relation to communal facilities, and so I consider it to be invalid.

    Rule 20: Shared Traffic Zones

17. This rule imposes a speed limit of 10 kilometres per hour, requests that pedestrians walk on the sides of roads, requires traffic signs to be observed, and requires that all motorised vehicles are registered ‘with adequate third party insurance, including third party property damage insurance’.

18. Mr and Mrs Hart argue that this rule is invalid because Queensland transport rules apply.

19. Palm Lake relies on section 77(2)(d) and section 105(2)(c) of the Manufactured Homes Act.

20. Again, reliance on another section of the Manufactured Homes Act is misconceived, but section 77(2)(e) is relevant. However, the requirements about insurance go beyond what is authorised under section 77.

21. I consider that rule 20 is invalid.

    Other rules

22. I have not considered whether other rules in the August 2017 version are valid, as their validity under section 77 (as distinct from the process used to introduce them) was not disputed by Mr and Mrs Hart.

    Whether valid rules are reasonable

23. I have not considered whether any valid rules are reasonable. Firstly, validity rather than reasonableness was the focus of Mr and Mrs Hart’s submissions. Secondly, it would be appropriate to examine reasonableness only if there had been at least five objections to the August 2017 version, and the matter had proceeded to QCAT under section 82 of the Manufactured Homes Act.

    What is the appropriate order?

24. Under section 140 of the Manufactured Homes Act, QCAT may make any order it considers appropriate to resolve a site agreement dispute.

25. In their application, Mr and Mrs Hart sought orders directing Palm Lake to set aside the new park rules, to convene a park liaison committee; and to ‘communicate and deal correctly’ with the homeowners.

26. So far as the second of those requests is concerned, a park liaison committee would be warranted under section 80 of the Manufactured Homes Act only if there were at least five objections to the letters sent on 25 September 2017, which is not the case here. So far as the third request is concerned, I note that after Mr and Mrs Hart lodged their application, Palm Lake did follow the correct procedure for introducing a rule change. Therefore I do not propose to make orders of the types sought in the second and third requests.

27. In relation to the first request, I accept that action is warranted although I believe that a slightly different response is appropriate. I have found that several of the rules in the August 2017 version are invalid. In the absence of any suggestion that Palm Lake considers that Mr and Mrs Hart have breached any of those rules, I believe that the most appropriate order is a declaration of invalidity of the rules in question. This will signal to Palm Lake that it should not take action against Mr and Mrs Hart in the event that they contravene those rules.

28. As other homeowners have not applied to QCAT, I do not consider it appropriate to make an order that requires Palm Lake to take action that affects all homeowners.

29. A declaration of invalidity of particular park rules in this proceeding will affect only the application of the rules to Mr and Mrs Hart. It is a matter for Palm Lake whether it wishes to administer different sets of rules for Mr and Mrs Hart on the one hand and for other homeowners on the other. A more sensible course might be for Palm Lake to propose a new set of rules, within the scope of section 77, for all homeowners, but that is a matter for Palm Lake.