Peter Morgan v Hacienda Caravan Park Pty Ltd

[2014] NSWCATCD 169

NSW Civil and Administrative Tribunal

New South Wales

Medium Neutral Citation:

Peter Morgan & Ors v Hacienda Caravan Park Pty Ltd [2014] NSWCATCD 169

Hearing dates:

21 May 2014

Decision date:

05 September 2014

Before:

J McMillan, General Member

Decision:

1.The rent shall not be increased by more than $5.00 per week for the 12 month period commencing 1 April 2014 to 31 March 2015.

2.Any amount if rent which has been overpaid as a result of Order 1 is to be refunded to the applicant.

3.In respect of application No RP 14/1684 John Hodson v Hacienda Caravan Park Pty Ltd time is extended to bring the application.

4.All other claims are dismissed.

Catchwords:

Nil

Legislation Cited:

Residential Parks Act 1998

Cases Cited:

Tweeddale v Gaias (Tenancy) [2007] NSWCTTT 156 (28 March 2007)

Texts Cited:

Nil

Category:

Principal judgment

Parties:

Peter Morgan & Ors (applicants)
Hacienda Caravan Park Pty Ltd (respondent)

Representation:

Nil
Nil

File Number(s):

RP 14/10678

reasons for decision

APPLICATION

1. An order that a proposed rent increase is excessive.

An order that the current rent is excessive.

1. The park owner issued a notice of rent increase to the applicants dated 17 January 2014. The residents lodged applications with the Tribunal on 25 February 2014 seeking orders;

(i) Pursuant to sections 55 and 56 of the Residential Parks Act 1998 (the Act) that the proposed rent increase is excessive;

(ii) Pursuant to section 56 of the Act that the current rent is excessive due to the withdrawal of or reduction of services and facilities; and

(iii)   In the matter of (RP 14/1684) John Hodson v Hacienda Caravan Park Pty Ltd that time be extended to bring the application.

1. A total of 52 applications were lodged and they came before the Tribunal on 14 March 2014 when they were adjourned and orders were made for the exchange of documents between the parties that were intended to be relied upon at the hearing. The matters were heard on 21 May 2014 and the member reserved his decision.

1. No challenge was made to the validity of the notice of rent increase.

1. In regard to the application by Mr Hodson he was on holiday when the other residents lodged their applications. On his return he lodged his application. The matters raised in Mr Hodson's application are the same as those raised in the applications lodged by the other residents and the view of the Tribunal is that there is no prejudice suffered by the park owner where time is extended. Time therefore I extended to bring the application.

1. Section 57 of the Act provides;

57 Matters to be considered in determining rent applications

The Tribunal may, in determining whether or not a rent increase or rent payable under a residential tenancy agreement or a proposed residential tenancy agreement for residential premises is excessive, have regard to each of the following factors:

(a) the general market level of rents for comparable premises in the same residential park and in other residential parks in the locality or a similar locality,

(b) the value of the residential premises,

(c) the frequency and amount of past rent increases under the residential tenancy agreement or previous residential tenancy agreements between the same park owner and resident,

(d) a general price index (such as the Consumer Price Index),

(e) the conduct of the parties,

(f) the amount of any outgoings in respect of the residential premises required to be borne by the park owner under the residential tenancy agreement or proposed agreement,

(g) the estimated cost of any services provided by the park owner or the resident under the residential tenancy agreement or proposed agreement,

(h) the value and nature of any fittings, appliances or other goods, services or facilities provided with the residential premises,

(i) the accommodation and amenities provided in the residential premises and the state of repair and general condition of the premises,

(j) any work done to the premises by or on behalf of the resident, to which the park owner has consented,

(k) any other relevant matter.

I shall deal with each of these separately.

(a)   the general market level of rents for comparable premises in the same residential park and in other residential parks in the locality or a similar locality,

1. The applicants nominated five other parks as being comparable. The table below stets out both the differences and common areas of these parks. The particulars were tendered to the Tribunal in the documents of the applicants.

HACIENDA HOLIDAY PARK	PYRAMID HOLIDAY PARK	DRIFTERS HOLIDAY VOLLAGE	POTTSVILLE NORTH	COLONIAL TWEED HOLIDAY & HOME PARK	BALLINA LAKESIDE
SITE FEES	$163.00* $251.00*	$139.50	$161.50	$144.00	$144.00	$148.10
AMOUNT OF LAST RENT INCREASE	Tribunal order 6.5% Variable	$7.00	$10.00 No increase 2014	$4.00	$9.00	$4.03
RESIDENTS PAY WATER	P/O PAYS	P/O PAYS	P/O PAYS BORE WATER FOR GARDEN	P/O PAYS	P/O PAYS	RESIDENT PAYS
MINI GOLF	NO	NO	NO	NO	NO	YES
JUMPING PILLOW	NO	NO	NO	NO	NO	YES
CAMP KITCHEN	YES	YES	YES	YES	YES	YES
GYMNASIUM	NO	NO	NO	NO	NO	YES
CARAVAN STORAGE	NO	NO	YES	YES	NO	NO
OFF-STREET PARKING	AT FRONT OF PARK	YES	AT FRONT OF PARK	YES	NO	AT FRONT OF PARK
PUBLIC TRANSPORT	AT FRONT OF PARK	YES	YES	YES	AT FRONT OF PARK	YES
NEAR WATER	YES	YES	YES	YES	YES	YES
CHILD PLAYGROUND	NO	YES	YES	YES	YES	YES
GAMES ROOM	NO	YES	YES	NO	YES	YES
BOOM GATE	YES	NO	YES	YES	NO	YES
PRIVATE MAIL BOXES	YES	YES	YES	NO	PARK INSTALLING	NO
WATER PARK	NO	NO	NO	NO	NO	YES
PETS	NO	SOME SECTIONS	NO	NO	NO	NO
GARBAGE	1 BIN PER 2 SITES	YES	YES	YES	YES	CENTRAL AREA

* Before proposed rent increase

1. The park owner tendered a letter the rent in the adjacent park which is Homestead Holiday Park. That park although owned by a different company has common directors with Hacienda Holiday park. The letter states that the rents in Homestead Holiday Park range from $180.15 per week for internal sites without on-suites to $234.90 for waterfront sites and water is not separately metered. No other benefits were identified.

1. Hacienda Holiday Park has a tourist component and as such that have tourist accommodation have a varying population particularly during holiday periods when holiday makers occupy the park. The facilities in these parks are also geared to accommodate these persons. The residents are required to share recreation facilities during these periods. Parks where there are no tourist accommodation tend to be quieter and there is little or no difference in the life style within the park throughout the year. The Tribunal therefore does not view parks without tourist accommodation to be comparable with parks that have tourist accommodation. Pyramid Holiday Park offers very similar facilities and has a similar number of tourist sites to Hacienda Holiday Park but there is a larger number of permanent resident sites.

1. The rents for Hacienda Holiday Park show have a range that is set by location of the site within the park and the facilities available to the site (such as ensuites). There is no evidence to show whether there is a range of site fees for the other parks. The site fees for Hacienda Holiday Park are the highest of all the parks. Pyramid Holiday Park has lower site fees than Hacienda Holiday Park but has similar facilities. Similarly Colonial Tweed Holiday Park is comparable on a facilities basis but has lower rents.

1. Within Hacienda Holiday Park the site fees vary. The reason for this is mainly historical with the most recent resident paying the higher fee. Some of the sites also have "ensuites" which attract a higher fee. The majority of tourist sites are located near the entrance of the park with the permanent sites being located to the north and the rear end of the park. Generally those sites with water frontages attract the higher fees while those located to the southern end of the park and nearer the tourist sites have lower site fees.

1. It is noted that the park has 98-99 permanent residential sites and all permanent residents received increase notices, 52 have made application that the rent increase is excessive.

(b) the value of the residential premises,

1. The dwellings on each of the sites belong to the resident and the land value is of no benefit to them. Therefore any benefit from its value is a benefit to the park owner.

1. It is noted that there is an exemption from land tax where more than 50% of the sites in a residential park are occupied by persons over 55 years of age and they occupy under residential site agreements.

(c) the frequency and amount of past rent increases under the residential tenancy agreement or previous residential tenancy agreements between the same park owner and resident

1. A list of site fee increases since 2004 was tendered. Two increases have been determined by the Tribunal. One in 2012 and the other in 2013.

YEAR	WEEKLEY RENT	CPI (SYD ALL ORDS)	% INCREASE
2004	$97.00	2.6%
2005	$103.80	2.8%	7%
2006	$111.90	3.3%	7.8%
2007	$121.80	3.0%	8.8%
2008	$127.25	3.7%	4.5%
2009	$134.65	2.1%	5.4%
2010	$142.90	2.7%	6.1%
2011	$152.20	3.1%	6.5%
2012	TRIBUNAL ORDER	6%
2013	TRIBUNAL ORDER	6.51%
2014	5.9% - 6.79%

1. The range of the increases for the period 2005 to 2013 is 5.4% to 8.8% which is an average of 6.51%.

(d) a general price index (such as the Consumer Price Index)

1. The residents claimed the increase in the consumer price index (CPI) since the rent was last set is 2.0%. This is not disputed by the park owner.

(e) the conduct of the parties

1. No evidence was tendered on this head of consideration.

(f) the amount of any outgoings in respect of the residential premises required to be borne by the park owner under the residential tenancy agreement or proposed agreement

1. No evidence was tendered by the residents on this sub section.

1. The park owner tendered a statement of outgoings prepared by its accountant. Ms Tanya Hickling is the accountant who prepared the document. She appeared at the Tribunal and gave evidence before it. She stated that in the preparation of the figures she stated that she excluded costs attributable to the tourist operations of the park. As well as depreciation allowances and items that are capital in nature.

1. The table below shows those figures relied upon.

EPENDITURE CATEGORY	BASE PERIOD 10/01/12 - 09/01/13	PERIOD 10/01/13 - 09/01/14	INCREASE DECREASE
ACCOUNTANCY	100.00	107.69	7.69%
BANK FEES AND CHARGES	100.00	110.09	10.09%
CLEANING AND POOL SUPPLIES	100.00	99.34	- 0.66%
COUNCIL RATES AND CHARGES	100.00	110.27	10.27%
ELECTRICITY	100.00	109.75	9.75%
FUEL	100.00	103.95	3.95%
GAS	100.00	109.11	9.11%
INSURANCE	100.00	102.09	2.09%
LEGAL AND PROFESSIONAL FEES	100.00	138.05	38.00%
LICENCES AND PERMITS	100.00	102.91	2.91%
PRINTING AND STATIONERY	100.00	98.17	- 1.83%
REPAIRS AND MAINTENANCE	100.00	105.19	5.19%
SUNDRY GENERAL EXPENSES	100.00	116.47	16.47%
TELEPHONE	100.00	102.49	2.49%
WAGES AND ON-COSTS	100.00	106.36	6.36%
WASTE REMOVAL	100.00	106.11	6.11%
TOTAL	100.00	107.01	7.02%

1. No evidence was tendered that demonstrated how the figures were determined, the methodology involved or particulars of the items.

1. It is noted the rent increase sought is less than the increase in the operational expenditure of the park.

(g) the estimated cost of any services provided by the park owner or the resident under the residential tenancy agreement or proposed agreement

1. Submissions only were made by the parties on this sub section.

(h) the value and nature of any fittings, appliances or other goods, services or facilities provided with the residential premises

1. No evidence was tendered.

(i) the accommodation and amenities provided in the residential premises and the state of repair and general condition of the premises

1. No evidence was tendered.

(j) any work done to the premises by or on behalf of the resident, to which the park owner has consented

1. No evidence was tendered.

(k) any other relevant matter

1. The applicants made submissions that compared resident incomes and rent paid for sites in residential parks and the affordability of living in residential parks. This is a matter that has been considered a number of times by the Tribunal. Member Marzilli said in Tweeddale v Gaias (Tenancy) [2007] NSWCTTT 156 (28 March 2007)

"The function of the Tribunal is to apply section 48 of the 1987 Act as interpreted by the Supreme Court in Kilpatrick v Gresser and not attempt to circumvent that section by not considering the overriding and predominant criterion there set out being the general market level of rents for comparable premises as set out in the section. Moreover, care should be taken in considering other matters under paragraph 48(g) of the 1987 Act such as a tenant's capacity to pay: Davy v NSW Land and Housing Corporation[2007] NSWCTTT 25, Bentink v NSW Land and Housing Corporation[2007] NSWCTTT 47, Grennard v Commissioner for Housing for the ACT[2001] ACTRTT 20; as the matters that may be considered under the paragraph last-mentioned are limited by the ejusdem generis rule of statutory construction: Davis v Department of Housing [2001] NSWRT 182 at paragraphs 10.12 to 10.14, McLeod v NSW Department of Housing[2006] NSWCTTT 632."

1. The cases CITED BY Member Marzilli did not find that the capacity of a tenant to pay an increased rent was not a relevant matter when considering an excessive rent increase.

1. The park owner tendered a copy of the agreements for 42 sites in the park. There were two types of forms. One is a form titled "Residential Tenancy Agreement for landlords and tenants of Moveable Dwellings or Moveable Dwelling Sites" and the other is titled "Occupation Agreement Schedule 1 & 2". The park owner claims that the residents who have singed the latter of these is not under the Act. It is noted that in matter No 13/48721 the Tribunal made orders for rent increases for 20 of the sites.

1. Section 5 of the Act provides;

5 Application of Act

(1) This Act applies to residential tenancy agreements under which:

(a) the residential premises consist of a residential site, or a moveable dwelling on a residential site, and

(b) the resident occupies the residential premises as the resident's principal place of residence, and

(c) in the case of an agreement entered into after the commencement of this section, the resident has the approval of the park owner or park manager to occupy the premises as the resident's principal place of residence.

(1A) A person does not cease to occupy residential premises as the person's principal place of residence by reason only that the person is absent from the premises for the purpose of receiving medical, nursing or domestic care.

(2) This Act applies whether the relevant residential tenancy agreement was entered into before or after the commencement of this section, unless a particular provision provides otherwise.

(3) Where this Act applies to a residential tenancy agreement, it so applies despite the terms of any such residential tenancy agreement or any other contract, agreement or arrangement, whether made before or after the commencement of this section.

1. The park owner did not tender any evidence that showed the residents under an occupation agreement did not occupy these premises other than as their principle place of residence. The park owner has dealt with them under the provisions of the Act and not the provisions of the Holiday Parks (Long-term Casual Occupation) Act 2002. Although it does refer to the fee in the notice of rent increase as an occupation fee" rather than rent. Notwithstanding this the Tribunal finds the principal place of residence of these applicants is Hacienda Caravan Park and therefore are under the Act.

1. In consideration of the evidence before it the view of the Tribunal is that the rent for this park before the rent increase is higher than other comparable parks. The evidence satisfies the Tribunal that services in the park have remained the same for the past 12 months and there is no proposal put forward for increasing or improving the services and facilities.

1. There has been an increase in the CPI and there has been some increase in the operating costs of the park although the figures tendered by the park owner do not show any affect taxation has on those figures and the Tribunal gives little weight to them. The park owner did not tender any evidence of other index that would support the variation in its costs.

1. The Tribunal finds therefore that the proposed rent increase is excessive and allows a rent increase of $5:00 per week for each site.

1. No evidence was tendered on the other matters sought that satisfies the Tribunal an order should be made. The view of the Tribunal is that in relation to the trees that is a term of the agreement under which the park owner has an obligation and any breach of that obligation should be dealt with as such. The claims are dismissed.

J McMillan

General Member

Civil and Administrative Tribunal of New South Wales

5 September 2014

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: 31 October 2014