Palmpoint Pty Ltd T/a Bribie Pines Island Village v Residents of Bribie Pines Island Village

[2006] QDC 253

[2006] QDC 253

DISTRICT COURT

CIVIL JURISDICTION

JUDGE ROBIN QC

No BD1711 of 2006

PALMPOINT PTY LTD
(ACN 010 864 422)
TRADING AS "BRIBIE PINES ISLAND VILLAGE"

Appellant

and

THE RESIDENTS OF BRIBIE PINES ISLAND VILLAGE AS LISTED IN SCHEDULE 1 ATTACHED

and

MOLLY ASTBURY

and

ROY TERRENCE HOSE and
PATRICE ANN HOSE

First Respondent

Second Respondent

Third Respondent

BRISBANE

..DATE 11/07/2006

ORDER

CATCHWORDS: Commercial and Consumer Tribunal Act 2003 s 100 - Manufactured Homes (Residential Parks) Act 2003, s 69, s 71 - leave to appeal where Tribunal rejected park owner's attempt to increase site rents under s 71 on basis that s 69 applied, thus excluding the availability of s 71

HIS HONOUR:  This is an application by Palmpoint Pty Ltd for leave to appeal against a determination of Mrs Spender sitting as the Commercial and Consumer Tribunal handed down on the 15th of May this year.

The appeal lies only by leave under section 100 of the Commercial and Consumer Tribunal Act 2003. The notice of appeal subject to leave invokes subsection (1)(a) in being made on the ground of "error of law".

The applicant operates a large and apparently expanding residential park which, since the commencement of the Manufactured Homes (Residential Parks) Act 2003 has been regulated by that Act. The operation had been underway for some time at the commencement of the Act and was previously regulated by other provisions.

The jurisdiction of the Tribunal was invoked by the applicant in connection with its attempts to "rationalise" the arrangements for site rent.  Its contention appears to be that the site rents have fallen below market value and ought be brought into line with that.
Mr Couper QC has drawn attention to the particular object of the 2003 Act referred to in section 4(2)(a) of encouraging the continued growth and viability of the residential park industry.  As one would expect, the Act carefully controls rent increases.  A feature of it is to prohibit contracting out by section 23 and to establish that provisions of the Act prevail where there is any inconsistency with either a special term or a standard term of a site agreement under section 24.

Site rent increases are dealt with in two sections which come in different divisions. Division 2, Increase in Site Rent Provided for in Site Agreement contains section 69:

"69  Notice of increase in site rent

(1)  This section applies if a site agreement-

(a)  provides for an increase in the site rent

payable under the agreement; and

(b)  states how the amount of the increase is to be

calculated.

(2)  If the park owner wishes to increase the site rent

under this section, the park owner must give the home owner a notice stating the following-

(a)  the amount of the increased site rent;

(b)  how the increased site rent has been

calculated;

(c)  the day the increased site rent is first

payable (the increase day);

(d)  if the home owner considers the increase is

excessive, the home owner may apply to the tribunal, within 28 days after receiving the notice, for an order reducing the amount of, or setting aside, the increase.

(3)  The increase day must not be earlier than 28 days

after the notice is given.

(4)  The increased site rent is payable from the increase

day."

and Division 3, Other Way of Increasing the Site Rent, includes section 71:

"71  Notice of proposed increase in site rent

(1)  This section applies if-

(a)  the park owner for a residential park wishes to

increase the site rent payable under a site agreement; and

(b) section 69 does not apply to the proposed

increase.

(2)  The park owner must give the home owner for the site

a notice stating the following-

(a)  the amount of the proposed increased site rent;

(b)  the basis for the proposed increase;

(c)  the day the proposed increased site rent is

first payable (the increase day);

(d)  the home owner must, within 28 days after

receiving the notice, give the park owner a written response indicating whether or not the home owner agrees to the proposed increase.

(3)  The increase day must not be earlier than 2 months

after the notice is given.

(4)  The home owner must within 28 days after receiving

the notice give the park owner a written response indicating whether or not the home owner agrees to the proposed increase.

(5)  If the response indicates the home owner agrees to

the proposed increase, the proposed increased site rent is first payable on the increase day.

(6)  If the home owner does not give a written response

under subsection (4) within the 28 days, the home owner is taken to have not agreed to the proposed increase.

(7)  If the park owner and home owner do not agree on the

proposed increase within the 28 days, the park owner may apply to the tribunal for an order about the proposed increase.

(8)  In deciding the application, the tribunal may have

regard to the matters mentioned in section 70(3).

(9)  Also, in deciding the application, the tribunal may

make any of the following orders-

(a)  an order reducing the amount of the proposed

increase by a stated amount;

(b)  an order setting aside the proposed increase;

(c)  an order confirming the proposed increase on

the conditions, if any, the tribunal considers appropriate;

(d)  another order the tribunal considers

appropriate.

(10) If the tribunal makes an order mentioned in

subsection (9)(a) or (c), the order must also state the day from which the increased rent is first payable."

There is a limited provision in section 72 whereby the Tribunal in strictly defined circumstances may reduce site rent. The Tribunal may also become involved under the following sections in reviewing utility costs included in site rent. The applicant notified rent increases it was desirous of applying (on the basis of what it says is "rent review") under section 71. It seems that many of the home owners, as the Act describes the rent payers, accepted the proposed increases; a large number did not, whereupon the applicant invoked the jurisdiction of the Tribunal.

The Tribunal determined that the application should be dismissed on a legal ground, namely the non-applicability of section 71, because of the applicability of section 69. It would appear that, for the most part if not totally, the site agreements provide for increases in site rental based on CPI. The Tribunal's view was that section 69 applied and that in consequence section 71 could not be availed of by the applicant.

It wishes to establish, if it can, that whether or not section 69 applies is a matter of whether or not it chooses to invoke section 69. It would say the only "proposed increase" is one under s 71. There is obviously room for opposite points of view here. Section 71(1)(b) asks whether section 69 applies. Section 69(1) in terms sets out when the section does apply. On that approach there is no need to look at any part of section 69 other than the first subsection.

It is clear that the current dispute is of great concern to the home owners most of whom are represented by Mr Hamilton as agent, permitted to appear under section 52 of the District Court of Queensland Act. Mr Astbury has represented his mother, and also, for today's purposes only, the third respondents, Mr and Mrs Hose; they looked after their own interests before the Tribunal in contrast with the 92 or so who have become first respondents. Their basic approach is that the 2003 Act respects the right of parties to make whatever contracts they wish to and that the Act ought not to be construed to permit a contracting party (and here the applicant, in particular) to override the site agreements which make the provision they do for increase in site rental, by adopting the section 71 procedure.

Mr Astbury raises the additional point based on Exhibits 1 and 2 that the appeal the subject of the leave application appears to be a pointless one now because the exhibits would indicate that the applicant has determined to proceed under section 69 - which it certainly seems there is an admitted entitlement to do.

It is a mystery to what extent the exhibits (addressed to Mrs Astbury) are representative of communications to all home owners.  That of 26 May 2006, Exhibit 1, claims to apply a CPI increase of 2.6 per cent from 24 June 2006 and Exhibit 2 within days claims a further increase of 2.75 per cent from the 1st of July 2006.

The former increase would no doubt have been backdated to the 1st of July 2005 had that course been open to the applicant.  What was done was probably a reaction to the Tribunal decision now sought to be brought under appeal. 

I accept that Mr Astbury has raised a potentially serious difficulty for the applicant. There must be a question whether, having increased rents on the basis of section 69 for particular periods, it can then seek to apply further rent increases for those same periods. I am not purporting to resolve any such difficulties here - nor indeed any legal questions at all. I am considering only whether leave to appeal ought to be granted.

Looking at section 100, it requires that the appeal be grounded on an asserted error of law, as this one is. There remains a question whether this Court, in its discretion, ought to grant leave to appeal which, in accordance with hallowed practice, it would not do if the appeal seemed utterly hopeless. That practice, which I think is relevant under section 100, would indicate that leave may be granted even if the District Court Judge thinks it unlikely that the asserted error of law would be established to be one. The question is whether the appeal has some prospect of success.

Where the point involved is of general importance, it seems to me the Judge asked to grant leave should be more ready to do that.  His or her provisional opinion about the merits or otherwise of the legal point sought be ventilated, may well not be correct. 

I am sensible of the great advantage the respondents justifiably feel they won for themselves and for others in their position generally. However, the Court must look at the interests of the applicant as well and, more generally, at the interests of other operators of residential parks.

In my opinion, the general public importance of the question that the applicant wants to raise cannot be gainsaid.  If leave were refused, that would be tantamount to a decision of this Court endorsing the Tribunal member's comprehensively reasoned views, even though there has been no occasion for this Court to hear full legal argument on the point.  It's been clear from the outset that the subsequent appeal would not proceed today.

I think that leave ought be granted - one consequence of which may be that there eventuates not only a decision at District Court level on this important point, but one at a higher level, depending on what happens.

...

HIS HONOUR:  I will grant leave to appeal and order that the costs of the application for leave be reserved to the Judge who deals with the appeal.  That does not imply any ruling that costs may be ordered.  There are potentially relevant statutory provisions about costs in such appeals.

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