V.A. Allan – v.- Flagship Leisure Parks P/L t/as Sundown Motel
[2006] ACTRTT 2
•3 January, 2006.
V.A. Allan – v.- Flagship Leisure Parks P/L t/as Sundown Motel ACTRTT2 [2006]
CATCHWORDS
Occupancy Agreement
Jurisdiction by consent
Contra proferentems rule
Tenancies at common law
ISSUES
Definition of occupancy agreement for people with indefinate tenure
Implying terms into a lease
Contra proferentems rule
Hiatus in the Act – no coverage of tenancy at common law which are not also residential tenancies
Indicia of a valid lease at common law
Jurisdiction by consent of the parties
LEGISLATION
Residential Tenancies Act 1997 (ACT)
sections: 71C
prescribed terms:
CASES CITED
Royal Botanical Gardens and Domain Trust v South Sydney CC 2002 HCA 5;
Allianz Australia Workers Compensation NSW Ltd v PPG Industries P/L ACTCA 28;
“Residential Tenancies Law and Practice in NSW” [3.28.2] Anforth, Thawley and Christensen; Parkroad Projects P/L v. Luckey ([1999] NSWSC 214);
Multicon Engineering Pty Ltd v Federal Airports Corporation (1997) 47 NSWLR 631;
Cockle v Isaksen (1957) 99 CLR 155;
Thomson Australian Holdings Pty Ltd v. Trade Practices Commission (1981) 148 CLR 150; National Parks and Wildlife Service v Stables Perished Pty Ltd (1990) 20 NSWLR 573; Household Financial Services Ltd v. Commercial Tribunal (NSW) (1995) 36 NSWLR 220.
Case Reference Number: RT 1269 of 2005
Re: 17 The Pines Avenue, Sundown Village, Narrabundah ACT 2604
Decision
1. That the application is dismissed.
Member: A. Anforth
Date: 3 January, 2006.
IN THE RESIDENTIAL TENANCIES
TRIBUNAL OF THE AUSTRALIAN
CAPITAL TERRITORY No. 1269 of 2005BETWEEN V.A. Allan
(Occupant/Applicant)ANDFlagship Leisure Parks P/L t/as Sundown Motel
(Landlord/Respondent)
STATEMENT OF REASONS
1. This case concerns a complaint by a resident of the Sundown Village, in Narrabundah in the ACT against the landlord. Sundown Village is a long stay caravan park and is the only one of its kind in the ACT.
2. The Applicant lives on a moveable dwelling site. There are some 88 of these in the park. In addition there are 100 motel sites in the park.
3. The dispute concerns three issues:
(a)the practice of the landlord for charging rent increases on CPI
(b)the practice of the landlord of passing on the electricity supply charge in accordance with the Published Domestic Tariff of ACTEW which resulted in the landlord making a small profit over the supply charge levied on the tenants. The landlord attributed the difference to administrative and maintenance charges associated with providing and maintaining the electricity supply to tenants.
(c)The fact that the above practices constituted a departure from the occupation agreement entered between the parties in 1992.
4. The Applicant based brought their case on the basis that they were occupants within the meaning of Part 5A Residential Tenancies Act 1997. Ultimately the Tribunal found that the Applicant did were not occupants and were not tenants pursuant to any residential tenancy agreement. The Applicant was however a tenant at common law. The Tribunal heard and determined the matter by the consent of the parties.
5. On 13 April 2005 the Applicant’s husband. Mr D.C. Allen lodged an application with the Tribunal on her behalf. The statement of particulars lodged with the application was brief and stated:
1. Please Identify the Issues In Dispute, for example, payment of rental arrears or that the lessor/grantor fix a broken heater.
•Tenancy agreement varied without consent of tenant.
•Basis of calculation of rent increase invalid;
•Supply charge for electricity invalid.2. Please state the nature of relief you seek (what sort of order you want the Tribunal to make) for example, an order that the tenant/occupant pay rental arrears or the lessor/grantor fix the broken heater.
3. Please give a brief history of the dispute (why you are making the application). If you are claiming money please show calculations and total amount claimed.
The history of the dispute identified in letters to the Tribunal 10th December 2004 and 8th March 2005, and accompanying attachments, is a follows:
It is my belief that Sundown Village has not observed the conditions of the signed written tenancy agreement in two respects.
Issues:
1. The basis of calculating rent increase.
2. Making a charge for the supply of electricity.An attempt was made previously to resolve issue 1 (a continuing issue) - without recourse to the Tribunal - unfortunately without success. See letters and attachments.
No attempt has been made to resolve issue 2.
It is hoped that the Tribunal will clarify the validity of my tenancy agreement and offer possible solutions to resolving the issues amicably.
I should add that in 2002 I sought advice from the Office of Fair Trading as to whether or not my tenancy agreement was valid and was advised that was the case despite Sundown Village's change of ownership.
6. Attached to the application were:
(a)A copy of the occupation agreement between the Applicant and the Respondent dated 22 April 1992:
(b)A letter from the Respondent to the Applicant dated 8 August 2000 advising a rent increase from $70pw to $77pw from 10 October 2000:
(c)A letter from the Applicant to the Respondents dated 15 August 2000 taking issue with the rent increase. The letter drew attention to clause 15 of the occupancy agreement and contended that as there as no comparable premises in Canberra any rent increase can only be based on increased costs to the owner. The Applicant pointed out that the rent increase notice gave no particulars of any increase costs.
(d)A letter from the Respondent to the Applicant of 30 August 2000 advising that the rent increase was based on CPI increases since the last rent increase in July 1997 plus GST costs.
(e)A letter from the Respondent to the Applicant of 3 December 2001 advising a further rent increase to $81.60 per week from 5 February 2002, based on CPI.
(f)A letter from the Respondent to the Applicant of 2 December 2002 advising a rent increase to $83.90 per week from 4 February 2003 based on CPI.
(g)A letter from the Applicant to the Respondent dated 14 January 2003 contending that CPI is not a valid basis for a rent increase under the occupation agreement. The Applicant specifically did not deny that some rent increase may be justified on the basis of increased costs.
(h)A letter from the Respondent to the Applicant of 2 December 2003 advising a rent increase to $86.08 per week from 4 February 2003, based on CPI.
(i)A letter from the Applicant to the Respondent dated 8 December 2003 advising that CPI is not a valid basis for rent increase under the occupation agreement.
(j)A letter from the Respondent to the Applicant dated 6 December 2003 advising a rent increase to $68.08 per week effective 3 February 2004, based on CPI.
(k)A letter from the Applicant to the Respondent dated 10 December 2004 advising that CPI is not a valid basis for a rent increase. The letter essential again took issue with CPI as a valid basis for a rent increase. It read:
I write to you on the above matter due to the fact that, despite my written agreement with Southern Drive-ln Pty Ltd the original owners of Sundown Village, signed 1992 states in Clause 15 (Attachment A) the two bases on which an increase can be determined, for the past three years my rent has been increased by the CPI.
The history of the issue (see Attachments A,B,C,D,E,F) starts following the purchase of Sundown Village by Flagship Leisure Parks Pty Ltd., in 1999. In August 2000, a year after the purchase residents received notice of a fairly substantial rent increase. I was happy to pay the increase as there had not been an increase since 1997. However, every year since there has been an increase based on CPI and on each occasion I objected for the following reasons:
1 .It was contrary to the terms of my tenancy agreement;
2. had never been advised of Flagship's proposal to introduce annual increases based on CPI;
3. The reduction in services and maintenance.A further reason is that residents own their own homes with the rent applying only to the small piece of land on which their home sits.
In 2002, to try and avoid disputation I proposed a meeting with the Flagship director responsible for Sundown at which I hoped the issue could be resolved.
A meeting was held at which I understood that residents in the second stage of Sundown's development were operating under an agreement in which CPI was the agreed mechanism for assessing rent increases. The meeting broke up on the basis that a new draft common agreement would be drafted to cover all Sundown residents. (As it transpires, both agreements are the same.)
As this did not happen the only recourse open to me was to take civil proceedings which, as a age pensioner I could not afford. And so the situation remained until September this year when the ACT Legislative Assembly passed the Residential Tenancies Amendment Act 2004.
Other pensioner residents afraid to say anything and afraid to refuse to pay the increase are becoming increasingly stressed that the continued CPI increases will end their hope of living independently. It may be, of course that CPI is the best method but until such times as the matter is examined and resolved their concern will remain. As the next increase is due to start February 8, 2005, it would be most helpful if the matter could be heard quickly
(l)A letter of 8 March 2005 from the Applicant to the Respondent taking issue with the CPI as a valid basis for rent increases and taking issue with the rate charged by the Respondent for electricity supply. The electricity issue specifically alleged that the Respondent was passing on the ACTEW supply charge to the occupants contrary to clause 1 of the occupation agreement. The letter read:
Issue 1. Rent charges
Issue 2. Supply charge for electricityOn December 10th, 2004, I wrote to the Tribunal about Issue 1 but was advised no action could be taken as the Residential Tenancies Amendment ACT 2004, under which this issue falls, would not come into effect until March 8th, 2005.
Issue 1. A brief reprise
My tenancy agreement makes no mention of an annual increase based on the Consumer Price Index (CPI) but that increases will be subject to the conditions outlined in clause 15 of my written agreement, signed 1992. See attached: Clause 15, Tenancy Agreement and nor has there been any mutually agreed amendment to include such a condition.
Issue 2. (See Attached: Clause 1, Tenancy Agreement). The tenant agrees to pay the domestic rate for units of electricity consumed. (No supply charge included.)
The fact is that under the previous management, supply was part of the weekly rent. Unfortunately since October 2000, a supply charge has been added to tenants' electricity bill.
An attempt was made to settle the first issue through consultation but to no avail. On the question of
Issue 2 however, no discussion has been held with management. I take no pleasure in raising these issues and bringing them at this late date. Unfortunately as an age pensioner unable to afford a lawyer, I had to wait until the Residential Tenancies Amendment Act 2004 took effect.
Let me add that other aged pensioners at Sundown are increasingly stressed because they feel the annual CPI rent increase and supply charge will end their hope of living independently.
It may be, of course, that the Tribunal will determine CPI is the best method of implementing a rent increase and that the supply charge is fair, but until such times as these issues are examined and resolved their concern will remain.
That being so it would be helpful if the matter could be dealt with quickly.
7. The occupation agreement between the parties relevantly read:
SITE. The landlord gives the owner tenant the right to take up occupancy on Site No. ________ at SUNDOWN VILLAGE to the terms and conditions set out in this Agreement.
…SITE RENT. The rent is $ 60 per week payable every 14 days in advance commencing on 22 April 1991 to the landlord at Sundown Village Reception or any other reasonable place the landlord names in writing or into an account named by the landlord.
TERMS AND CONDITIONS OF OCCUPANCY
1. The landlord agrees to pay: A.C.T. general rates; water rates; land tax; and any other charges set out in the additional terms of this agreement, which are payable by the landlord.
The owner tenant agrees to pay site rental on time; electricity to the site as metered at a rate not greater than the published domestic tariff of the electricity supply authority; gas as metered by the gas supply company; and any other charges set out in the additional terms of this agreement, which are payable by the owner tenant.
OWNER TENANT'S RIGHT TO QUIET ENJOYMENT
2. The landlord agrees:
that the owner tenant will have quiet enjoyment of the site without interruption by the landlord or any person claiming by, through or under the landlord or having superior title to that of the landlord and there is no legal reason that the landlord knows about, or should know about when signing this agreement, why the site cannot be occupied.
…RENT INCREASE
15. The landlord must give the owner tenant sixty (60) days notice in writing of any increase in the rent. The landlord agrees not to increase the rent more than once each calendar year.
The increase, as determined by the landlord, will be either -
(a) An amount decided by Increasing the current rent by the same proportion as the average Increase in A.C.T. Government charges for the property in the period since the last review; or
(b) The comparable market rate in Canberra;
whichever is the greater.
…
VARIATION TO THIS AGREEMENT18. This Agreement, except as amended in writing and signed by both the landlord and the owner tenant, comprises the whole agreement between the landlord and the owner tenant. Neither the owner tenant nor the landlord is entitled to rely on any oral representation or any implied condition, in determining the respective rights and obligations of both the tenant and the landlord under this Agreement.
Additional terms (Including rules) may be included in this Agreement if they do not conflict with the standard terms of this Agreement.
…
FUTURE SUB -LEASE ARRANGEMENTS21. When appropriate sub-lease provisions are finalized by the A.C.T. Government this Agreement will be terminated and be replaced by a sub-lease agreement offering up to a twenty (20) year term for owner tenants on similar terms and conditions to this Agreement; excepting that a provision for notice of intention by the landlord be given not less than six (6) months from expiry of the term.
DEFINITIONS:
In this Agreement:
"the property" includes the whole of the land situated at Jerrabomberra Avenue, Narrabundah in the Australian Capital Territory and its improvements known as Sundown Village;
"landlord" means the person who grants the right to occupy sites under this Agreement and includes the landlords heirs, executors, administrators and assigns;
"landlord's agent" means a person who acts as the agent of the landlord and who (whether or not the person carries on any other business) carries on business as an agent for the collection of rents payable for any tenancy of the site;
"site" means a site on which a relocatable dwelling is situated or is intended to be situated;
"tenancy" means the right to occupy the site under this Agreement;
"owner tenant" means the person/s who owns the relocatable dwelling and who has the right to occupy the site under this Agreement.
"sub-tenant" means the person/s who occupies a relocatable dwelling from an owner tenant where the approval of the landlord is given.
ENDING THE AGREEMENT:
Where a breach of this agreement has occurred:
The landlord may give a notice to the owner tenant ending the agreement by:
* delivering it personally to the owner tenant or a person who appears to be 16 years or older who usually pays the rent on behalf of the owner tenant; or
* delivering it to the residential premises occupied by the owner tenant and leaving it there for the owner tenant with some person who appears to be 16 years or older; or* sending it by post to the residential premises occupied by the owner tenant.
An owner tenant may give notice to the landlord ending the agreement by:
* delivering it personally to the landlord, the landlord's agent or c person who appears to be 16 years or older who usually receives that rent on behalf of the landlord; or
* sending it by post or facsimile transmission to the landlord's usual place of residence or business or employment; or
* sending it by post or facsimile transmission to the landlord's agent at the agent's usual place of business.
Immediate notice may be given to end this agreement where:
* the owner tenant has not paid the rent for 28 days; or
* the landlord or the owner tenant or sub-tenant breaks the agreement; or
* the landlord or the owner tenant wants to give vacant possession at the end of the fixed term set out in the agreement.
If notice is given for these reasons, 28 days notice must be given.
If notice is given for some other reason and the tenancy is for a fixed term, notice may only be given after the fixed term has ended.
A landlord can end this agreement without first giving notice if:
* the owner tenant has intentionally or recklessly caused or permitted serious damage to the site or relocatable dwelling or injury to the landlord, landlord's agent or neighbors ( or person permitted on adjoining or adjacent premises) or there is a real risk that this might happen; or
* in the special circumstances the landlord would suffer undue hardship if required to give notice. The landlord can be ordered to pay compensation to the owner tenant if the agreement is ended The landlord, owner tenant and/or sub-tenant enter into this agreement an agree to all its terms
8. The matter was listed before the Tribunal on 28 April 2005. On that occasion Mr Allan appeared in person and Mr Graeme Nunn, director of the Respondent appeared in person. The Tribunal sought to more precisely identify the issues between the parties and the evidence. The Applicant informed the Tribunal that he had formerly been the manager of the park prior to its sale to the present Respondent. The Applicant said that he had personally drafted the occupation agreement on behalf of the park management.
9. The Tribunal made orders for the parties to file and serve a statement of issues together with witness statements.
10. On 4May 2005 the Applicant filed the following statement:
1988, Sundown Village opened as an 80 unit motel with restaurant, swimming pool, tennis court and conference centre.
A residential village for manufactured homes has since been added to the complex.Issue
• Tenancy agreementClause 1. Payment of rates and other charges
The landlord agrees to pay: A.C.T: general rates; water rates; land tax; and any other charges set out in the additional terms of this agreement, which are payable by the landlord.
The owner tenant agrees to pay: Site rental on time; electricity to the site as metered at a rate not greater than the published domestic tariff of the electricity supply authority; gas as metered by the gas supply company; and any other charges set out in the additional terms of this agreement, which are payable by the owner tenant.
• Issue: Domestic supply charge (currently being charged) is not part of the above payment provisions
Clause 15: Rent increase
The landlord must give the owner/tenant sixty (60) days notice in writing of any increase in the rent. The landlord agrees not to increase the rent more than once each calendar year.
The increase as determined by the landlord will be either -
(a) An amount decided by increasing the current rent by the same proportion as the average
increase in ACT Government charges for the property in the period since the last review;
OR
(b) The comparable market rate in Canberra; whichever is the greater."
• Issue: Rent increase is now based on CPI and is in excess CPI of the foregoing provisions.
Clause 18. Variation to this agreement
This Agreement, except as amended in writing and signed by both the landlord and the owner tenant, comprises the whole agreement between the landlord and the owner/ tenant. Neither the owner tenant nor the landlord is entitled to rely on any oral representation or any implied condition, in determining the respective rights and obligations of both the tenant and the landlord under this Agreement.
Additional terms (including rules) may be included in this Agreement if they do not conflict with the standard terms of this Agreement.
• Issue: Clause 1 and 15 have been amended without consent in writing of owner/ tenant
1988, Sundown Village opened as an 80 unit motel with restaurant, swimming pool, tennis court and conference centre.
A residential village for manufactured homes has since been added to the complex.
11. The Respondent/landlord filed the following statement:
Clause 1 . Issue: Domestic supply charge (currently being charged) is not part of the above payment provisions.
Response: Advise received from ACTEWAGL - Mr Tom Barry confirms our charges are in accordance with the published domestic tariff of ACTEWAGL.
Clause 15. Rent Increase.
Response: Mr Allan advises he will accept the CPI as the measure for rent increase.
Clause 1 8. Variation to the Agreement.
Response: Clause 1 . has not been amended; Clause 1 5 will require consent from owner/tenant and therefore should be amended accordingly.
ACT GOVT. CHARGES 1-7-02 1-7-03 1-7-04
30-6-03 30-6-04 30-6-05Water & Sewerage 64,492.00 70,685.00 87,619.00
Land Tax 5661.38 6055.00 6909.36
General Rates 5338.91 5186.42 5698.59
Garbage Collection (tonne rate) 40.00 50.00 60.00
TOTAL 75,492.29 81,926.42 100,226.95
Increase/Decrease +8.52% +22.33%
CPI +2.9 to 8-2-05
12. The matter was listed before the Tribunal on 26 May 2005. Mr Allan appeared in person and Mr Nunn appeared for the Respondent.
13. The Applicant tendered a spread sheet:
Rent and Rate Increases
Proportion: Motel 65% Residential Village 35%
AUV 2003: $385,000 as per ATO and supplied by Sundown Village
Rates 2003
Valuation based charge
plus fixed charge and GST (385,000 -19,000) x 1.33356 $5338.76
2004 AUV 2004 $600,000
Valuation 600,000 x 13356
Total increaseProportional increases Motel $2674 x 65% $1738.65
Res $2674x35% $ 936.14
Land Tax
AUV 2003: Calculated on $385,000 shown above
Tax 2003Calculation 385,000 x 1.7 $6579
2004
Calculation 600,000 X1.7 $10.200
Total increase $ 3621
Proportional increases Motel $3621 x 65% $2353.65
Res $3621 x 35% $1267.35Combined annual increase for rent purposes: $936.14 + 1267.35 = $2203.49 Allocated on unit basis $2203 49 * 88 =$42.37 Weekly .81c Increase based on CPI $2.50
Full rates and tax $8013.60 + $10,200 = $18,213.60 Pro rata charge for residential if at full rates and tax
Motel percentage: $18,213.60 x 65% = $11,838.84
Res percentage: $18,213.60 x 35% = $ 6374.76
Calculation of weekly increase $ 6374.76*52=$122.59+88 = $1.39
Electricity supply charge
Daily supply charge including GST for whole Sundown property, including residence: 60.50c per day.
Annual total: .6050 x 365 $220.85
Sundown daily supply charge to residences .3630
Annual total: .3630 x 88 x 365 $11659.56Difference: Sundown +$11,438.71
14. The above spread sheet proceeds on the basis that only 35% of the accommodation units in the park are moveable dwelling sites, the remainder are motel units. There are 88 moveable dwelling sites.
15. The Applicant contended that the figures for total taxes and charges (except for electricity) justified only an increase of $1.39 per week for the moveable dwelling sites in the year commencing July 2004 whereas the CPI increase was $2.50 per week. The differential of $1.11 per week is said to be unlawful overcharged by the landlord.
16. In relation to the electricity the Applicant contended that the total charge to the landlord from ACTEW was $220.85 (presumably for the 2003-2004 year), whereas the landlord in fact charged $11659.56 in total for the 88 moveable dwelling sites. The difference of $11,438.71 was said to be unlawful overcharging.
17. At the hearing the Applicant maintained that the Tribunal had jurisdiction to hear and determine the dispute in that the occupation agreement between the parties was an “occupancy agreement” within the meaning of Part 5A of the Residential Tenancies Act 1997. The Tribunal indicated its concerns that the terms of the occupation agreement between the parties may not satisfy the definition of an “occupancy agreement” contained in section 71C in that the agreement does not appear to permit the landlord to terminate the agreement without cause by less than 6 months notice.
18. The parties were invited to make submissions on this point. The Applicant indicated that he had in fact drafted the agreement in his previous capacity as park manager and it had been the intention at the time to confer permanent tenure on park residents such that they could not be removed without cause. Mr Nunn said that this was still the policy of the Respondent.
19. The Applicant said that the permanent tenure was to be an interim policy pending legislative amendments to provide crown sub-lease to the residents. This intention was reflected in clause 21 of the occupation agreement. It seems that no such legislation was ever enacted and the permanent tenure policy continued in place reflecting the will of both the landlord and the residents.
20. The proceedings were adjourned for the Tribunal to consider the jurisdictional issue. On 31 May the Tribunal delivered an interim order to the effect that the occupation agreement between the parties was not an “occupancy agreement” within the meaning of Part 5A and accordingly the Tribunal lacked jurisdiction. That interim order read:
INTERIM ORDER
Background:
1. The Applicant is the owner of a mobile home which is located in the Respondent's mobile home park in the ACT. A dispute has arisen between the parties concerning rent increases. The Applicant has filed an application with the Tribunal purporting to invoke Part 5A Residential Tenancies Act 1997 (the Act) which relates to "occupancy agreements", as opposed to residential tenancies. The immediate issue for the Tribunal is one of jurisdiction, namely whether the agreement between the parties pursuant to which the Applicant placed his mobile home on a site in the mobile home park, is an occupancy agreement within the meaning of section 71C of the Act.
2. The Applicant was previously the manager of the park from its opening in 1988 on behalf of Southern Drive In P/L. His employment in this capacity came to an end when the park was purchased by the Respondent in 1999. The Applicant lived in the park on his present site during the whole of this time and continues to do so.
3. In April 1992 Southern Drive In P/L entered into contractual arrangements with the
residents of the park, including the Applicant, to regulate the residents' right of occupation of sites in the park. A copy of the Applicant's agreement has been tendered in evidence before the Tribunal.4. On its face the agreement purports to create a relationship of landlord and tenant in
relation to the right to occupy the site in the park. The Applicant actually owns the mobile home and so the tenancy is restricted to the site, and the right to place the mobile home on the site.
5. The agreement describes the Applicant as the "tenant" and the Respondent's predecessor in title as the "landlord". The agreement regulates the Applicant's right to "sub-let" and refers to "sub-tenants".
6. Clause 2 of the agreement confers on the Applicant the substance of an exclusive right of occupancy:
The landlord agrees that the owner tenant will have quiet enjoyment of the site without interruption by the landlord....7. The agreement tendered has no site number inserted in the appropriate place in the document. The Applicant gave evidence that he has always resided in the same site number since 1992 and submitted that it followed from this fact that the relevant site number was always a matter of agreement between him and the landlord.
8. The agreement specifies the rent which is payable by fortnightly installments. The agreement specifies the commencement day of the right of occupancy.
9. The agreement does not specify any term or duration of the right of occupancy.
10. The agreement does specifically address the issue of the termination of the right of occupancy:
(a) clause 20.1 provides for the agreement to terminate if the Applicant sell his mobile home. This conduct is defined to constitute a repudiation of the agreement.
(b) clause 20.2 provides that any sub-letting or assignment shall constitute a repudiation of the agreement.
(c) a special condition at the end of the agreement provides for termination by either party on 28 days notice, based on a breach of the agreement by either party.
(d) a second special condition regulates the right to terminate the agreement during the fixed term of the agreement. It reads:
If notice is given for some other reason and the tenancy is for a fixed term, notice may only be given after the fixed term has ended.
(e) a third special condition at the end of the agreement provides for termination without notice where the tenant abuses the premises, the landlord or other tenants, or in cases of undue hardship to the landlord.11. The agreement does not specifically provide for any right to terminate the agreement other than those above, each of which requires some grounds or cause for the termination. There is no right reserved to the landlord to terminate on notice for "no cause". For that matter there is also no right reserved to the tenant to terminate at will.
12. It may be that the termination clause quoted at paragraph 10(d) above provides some basis for implying or inferring that the parties intended a right of "no cause" terminations. This inference might be drawn from the words "for some other reason", but this is by no means obvious given that:
(a) the agreement has gone to the detail of setting out the various grounds of termination without referring to any 'no cause" grounds ("expressio unius est exclusio alterius" Statutory Interpretation in Australia 5th ed Pearce and Geddes at [4.26])
(b) the third special condition permits the landlord to terminate without notice if the landlord is suffering undue hardship. It is not obvious why such a right would be necessary if the landlord could terminate at any time (outside the fixed term) by notice, without cause. It may be that this clause was intended only to apply in cases of fixed term agreements, albeit that the agreement itself makes no provision for fixed term agreements. It may also be that the benefit
of the clause was intended to do no more than relieve the landlord of the necessity for giving 28 days notice in cases of breach per the first special condition; but the requirement for 28 days notice only applies in terminations based on a breach and there is no breach necessarily implicit in the fact that the landlord is suffering undue hardship.
(c) clause 18 of the agreement states that the written agreement comprises the whole of the agreement and expressly excludes any "implied condition".
(d) in the course of evidence both parties agreed that it was the intention of the agreement not to permit "no cause" terminations of tenants, although there was no intention to prevent tenants leaving on notice. These concessions are important because the Applicant was responsible for the drafting of the agreement in his former employment; and the Respondent expressly concurs.
(e) the common law relating to the circumstances in which a condition can be implied into an agreement was recently reviewed by the High Court in Royal Botanical Gardens and Domain Trust -v- South Sydney C. C. 2002 HCA 5). It is not open to a court or tribunal to imply a term into an agreement which is inconsistent with an actual term of the agreement. This puts in issue the effect of clause 18. It is also not open to the Tribunal to imply a term into an agreement unless it is necessary to do so to give efficacy to the agreement or to reflect an agreed but inadvertently omitted term. Neither of these tests appears to be satisfied in the present case.
(f) the potential application of the "contra proferentem" rule which would see the terms of the agreement construed against the interest of the Respondent (Allianz Australia Workers Compensation NSW Ltd —v- PPG Industries P/L ACTCA 28; Residential Tenancies Law and Practice in NSW Anforth, Thawley and Christensen 2003 ed at [3.28.2].13. The Applicant has sought to invoke the Tribunal's jurisdiction under Part 5A of the Act on the basis that the agreement is an "occupancy agreement" within the meaning of section 71C:
(1) An agreement is an occupancy agreement if—
(a) a person (the grantor) gives someone else (the occupant) a right to occupy stated premises; and
(b) the premises are for the occupant to use as a home (whether or not with other people); and
(c) the right is given for value; and
(d) the grantor may lawfully terminate the agreement, without cause, by giving less than 6 months notice; and
(e) the agreement is not a residential tenancy agreement.(2) The agreement may be—
(a) express or implied; or
(b) in writing, oral, or partly in writing and partly oral.
14. Part 5A commenced on 8 March 2005.
15. In the course of the hearing the Tribunal noted that the agreement could not constitute a residential tenancy agreement within the meaning of the Act as section 6F expressly excludes from the definition of residential tenancy agreement any agreement for the right to occupy a site in a mobile home park.
16. The Tribunal observed to the parties that a "residential tenancy agreement" within the meaning of the Act was not co-extensive with the scope of a tenancy at common law (Anforth at [2.3.0]). Many of the categories of residential occupation excluded from the definition of a residential tenancy agreement in sections 6D-F could, and often are, tenancies at common law.
17. At common law the indicia of a tenancy are:
(a) an intention to enter a contractual agreement (Anforth [2.3.8])
(b) for value or consideration
(c) conferring on the tenant an exclusive right of occupancy (Anforth [2.3.0])
(d) having certainty about the fundamental terms relating to the identity of the parties, the premises, the period of the lease, the rent and the commencement date (Australian Tenancy Practice and Precedents Redfern and Cassidy at [170]18. The Tribunal observed that there was no reason at law why a person could not be a tenant of a site in a mobile home park, a retirement village, a university residence or any of the other categories of occupation expressly excluded from the coverage of the Act in sections 6D-F. Once a tenancy at common law is established then a bundle of rights and obligations arise between the parties.
19. In the present case the Tribunal observed that the agreement of April 1992 between the parties appeared to constitute a tenancy agreement at common law. In particular it appeared to constitute a periodic tenancy from fortnight to fortnight by reason of the provision for rent to be paid fortnightly (Redfern and Cassidy at [155].
20. At common law such a tenancy is a continuous one and not a series of separate fortnightly leases. The tenancy continues until lawfully terminated (Redfern and Cassidy [1770, 1775]). In the case of a fortnightly periodic tenancy the lease can be terminated at common law on a fortnights notice (Redfern and Cassidy [1775]).
21. However, at common law the parties can specifically agree the terms upon which a periodic lease can be terminated. The common law right to terminated on a fortnight notice can be abrogated by the terms of the lease itself ( Redfern and Cassidy [1775]).
22. In the present case it appears on first blush that the agreement is a period lease which abrogated the right to terminate without cause on a fortnights notice for the reasons given at paragraph 12 above.
23. This proposition was put to the parties by the Tribunal, who each agreed that the it was the intention of the agreement to confer security of tenure on residents and accordingly to prohibit "no cause" terminations.
24. The Tribunal then turned its mind to the proposition of whether the right to terminate for no cause was inherit in the nature of a periodic lease and could not be abrogated by the intention of the parties, notwithstanding paragraph 21 above. This appears to be a live issue in this present matter.
25. In order for the Tribunal to have jurisdiction in the present matter, the agreement must answer the description of an occupancy agreement as defined in section 71C(1). Each of the five criteria in that sub-section must be satisfied before an occupancy agreement comes into existence. There is no question that paras (a), (b), (c) and (e) are satisfied. The issue is whether para (d) is satisfied ie can the present agreement be terminated without cause with less than 6 months notice.
26. The answer to this question depends on whether a right to terminate without cause can be implied into the present agreement, either as a matter of fact (ie the parties actually intended this to the be case) or a as matter of law (because it is necessary to give efficacy to the agreement or because it is a non-excludable incident of a periodic lease).
27. The Tribunal has adjourned the present matter to afford the parties an opportunity to take legal advice on this issue and file and serve submissions on the point.
28. The Tribunal is mindful of the ACT Government's interest in the matter and would benefit from submissions of the Government on the legislative intent underlying section 71C.
Orders
1. The matter is adjourned to 2pm on 14 June 2005 for hearing of the jurisdictional issue only.
2. The parties, and the ACT Government if it so wishes, are to file and serve submissions on the jurisdictional issue by 10 June 2005.
3. The parties, and the ACT Government if it so wishes, have leave to appear by legal representatives
21. On 10 June 2005 the Applicant filed the following further submission:
I would like to make a brief reply to the above interim order. First some minor corrections.
Clause 2.
a. I was not the park manager but National Marketing Director for Center Cinema Services, parent company of Southern Drive - In Pty Ltd., operator of Sundown Village.
b. In 1 994 I was retrenched. I am now an age pensioner with a disability
Comments.
Paragraph 6F(1)(a) of The Residential Tenancies Act 1997 clearly excludes from the definition of "Residential Tenancy Agreement" any agreement relating to the occupancy of a site in Caravan Park.
Neither does it contain a clause that denies an owner tenant and landlord from entering into a valid agreement, such as the agreement in question, an agreement that Flagship and myself are happy to continue Clause 12 (d), that gives an occupant security of tenure in a caravan park, unless the terms of the agreement are breached.
Nor does there seem to be such a clause contained in the Residential Tenancies Amendment Act 2004, one of whose purposes was, as I understand it, to ensure that residents in situations such as Sundown would have the right to appeal to the Residential Tenancy Tribunal when disputes in relation to such agreements arose.
I would be surprised also, if Government, committed as it is to people's rights, would wish it otherwise. Indeed, the Minister, in his Second Reading Speech relating to changes in the Residential Tenancies Act, said "a significant measure in this bill is the recognition of 'occupancy agreements' and 'occupancy principles.' Jurisdiction for resolving disputes involving occupancy agreements is conferred on the Residential Tenancies Tribunal." Surely, such a significant measure would be effectively compromised if a landlord could simply evade the jurisdiction of the Act, and by implication the Tribunal, by complying with paragraph 71C(1)(d) and allowing a "no cause" termination with 6 months' notice.
It will be appreciated too, I'm sure, that I am simply a layman. However, I understand Mr. Anforth's comments and, like him, would be pleased to see the issue clarified, naturally without losing security of tenancy, so that the other issues in my petition can progress.
If this is not possible I would be pleased to receive advice on how to proceed.
22. The matter was next before the Tribunal on 21 June 2005. The Applicant appeared in person and Mr Nunn appeared by phone. At that hearing the Tribunal explained its lack of jurisdiction to hear and determine the dispute, in terms of the interim order previously published. The parties agreed to consent to the Tribunal hearing the matter, and agreed to abide the outcome of that determination by the Tribunal. On that premise the Tribunal made the following orders:
1That the parties each consented to the jurisdiction of the Tribunal to hear and determine the dispute over the electricity supply charge.
2That the respondent is to serve on the applicant a rent increase notice pursuant to clause 15 of the lease for the electricity supply charge.
3That the parties are to obtain from ACTEW and serve on the Tribunal a copy of the "published domestic tariff for the caravan park for all relevant periods, within 2 weeks.
4That the parties are to obtain from the ACT Government and serve on the Tribunal the relevant government charges referred to in clause 15 of the lease, within 2 weeks.
5That the matter is adjourned to Friday, 5 August 2005 at 10:00am.
23. Notwithstanding some suggestion to the contrary in Parkroad Projects P/L v. Luckey ([1999] NSWSC 214) Abadee J, it must be regarded as settled that it is simply not possible to confer jurisdiction upon a statutory tribunal by consent—see Multicon Engineering Pty Ltd v Federal Airports Corporation (1997) 47 NSWLR 631 at 664; Cockle v Isaksen (1957) 99 CLR 155 at 161; Thomson Australian Holdings Pty Ltd v. Trade Practices Commission (1981) 148 CLR 150 at 163–165; National Parks and Wildlife Service v Stables Perished Pty Ltd (1990) 20 NSWLR 573 at 585; Household Financial Services Ltd v. Commercial Tribunal (NSW) (1995) 36 NSWLR 220 at 222.
24. Notwithstanding this, the Tribunal determined to accept the agreement between the parties for it to hear and determine the issue. The Tribunal explained its motivation to the parties, namely that there is an hiatus in the ACT governing disputes between parties to common law residential leases, which are excluded from the Residential Tenancies Act. These people would need to commence proceedings in the Magistrates Court or Supreme Court which would entail costs and delays relative to proceedings in the Tribunal. Neither of these courts is structured or accommodated a dispute of this kind between unrepresented litigants, not the least because of the imposition of rules of evidence and procedure in those courts.
25. On 5 August 2005 both parties appeared.
26. The parties tendered a range of documents:
(a) Rates Assessment Notice for 2002-2003 $5338.76
(b) A Valuation Notice as at 1 Jan 2002 $415,000.00
(c) A Valuation Notice as at 1 Jan 2004 $600,000.00
(d) A letter from the Respondent to the Applicant dated 1 August 2005 advising a rent increase to $91.07 per week effective 9 August 2005 based on CPI.
(e) A copy of electricity notices from the Respondent to several residents of the park showing the method of calculation. That calculation involved a charge for consumption at $0.0830 per KW; a charge for domestic supply at $0.0286 per day; less the pension rebate of $0.67 per day.
(f) An ACTEW invoice to the Respondent for the period 1 Jan 05 to 31 Jan 05 in the sum of $3306.90. This charge was composed of $1159.63 for consumption; $1695.20 for supply charges; $65.10 for billing costs; the balance of $386.97 were government charges.
(g) A letter of 22 July 2005 from Independent Competition and Regulatory Commission to the Applicant which read:
The Utilities Act 2000 (the "Act") regulates, amongst other things, the distribution and supply of electricity. A person who distributes electricity through an electricity network, or supplies electricity to the premises of another person, must hold a license to provide those services under the Act. In special circumstances, the Minister may exempt a person from the requirement to hold a license.
In the normal course of events, individual customers are supplied with electricity by a licensed utility under a customer contract. However, the Act makes provision for a person to whom electricity is supplied under a customer contract to make that electricity available to the premises of another person.
Where the customer of a licensed utility supplies electricity to the premises of another person in this way they may, subject to a number of conditions, pass on the cost of electricity supplied to that person (section 98(1) of the Act). These costs relate to the actual quantity of electricity supplied to the second person. An approved meter must measure the quantity supplied, and any charge imposed must not exceed the maximum rate that a utility may charge under a standard customer contract to supply that quantity of electricity directly to that other person's premises. No additional charge in relation to the supply of electricity can be made.
Similarly, section 98(3) of the Act specifies that a person to whom electricity is supplied under a customer contract with a licensed utility must not impose on another person a charge for the use of that electricity at a rate that exceeds the maximum rate that a utility may charge under a standard customer contract for the supply of electricity. Nor can they impose any additional charge in relation to the use of the electricity. Section 98(3) specifically contemplates the incorporation of a charge for the use of electricity into charges for services or facilities. For example, a person conducting a business for the rental of accommodation or accommodation sites, where those sites have the benefit of utility services supplied to that person under a customer contract with a licensed utility, may pass on the cost of electricity supplied to the occupiers of those sites by charging a rent that incorporates that cost. The cost of electricity incorporated into the rent cannot exceed the amount charged under a standard customer contract with a utility. If the costs of electricity supply are incorporated into another charge such as rent, no additional charge for the use of electricity can be made.
Although not defined in the Act, the rates charged by licensed utilities under standard customer contracts are made up of a variable consumption charge based on metered consumption of electricity at the customer's premises, and a fixed supply charge, which reflects the utility's operating and infrastructure costs associated with the supply of electricity, for example, billing costs, customer service costs and such network costs as metering and meter reading costs, and asset recovery costs. A supply charge is in effect an availability charge that relates to the connection of the customer's installation to the utility's network and the costs of servicing the customer's connection and is specific to the utility. On this basis, subsections 98(1) and 98(3) would suggest that, while the cost of both the consumption charge and the fixed supply fee charged by the utility to its customer can be passed on under section 98 of the Act, the customer of a licensed utility cannot impose any charge in addition to that amount for electricity supplied by the customer to another person, or used by a person other than the customer.
(h) A letter from ACTEWAGL dated 30 June 2005 advising the domestic electricity supply charge from 1 July 2004, which was:
· For consumption 10.50c kwh (incl GST)
· For supply 41.80c (incl of GST)
(i) A further statement of issue by the Applicant which read:
Issues in dispute
Clause 1.
Supply charge to Sundown Village is included in other charges for which landlord is responsible. The charge being small (daily business rate time x 365 - currently approximately $104.00) it was absorbed as part of basic rent as is usual in caravan parks where residents are charged a base rent plus domestic metered tariff. This was the practice at Sundown until September 1999 at which time a separate daily supply charge was imposed.
Clause 15 Rent increase
Rent increases should be calculated on the basis of a proportionate sharing of the increase in rates and taxes not CPI.
Example
Increases in rates and taxes 2003 - 2004
Rate and tax increases based on official AUV of total site of Sundown Village which comprises 100 unit motel (which does it's own laundry) restaurant, conference centre, tennis court and 88 residences.
Water and sewerage figures supplied by Sundown VillagePro rata increases: Table 1: Motel 65% -Residential 35%; Table 2: Motel 60% - Residential 40%
Table 1
Rates
2003
2004
increase
Motel 65%.
Resident 35%
Rates …5338
Land tax 6579
Water and sew.70,6858013 10,200 87619
2675 3621 16,934
1739
1738
11,007936
1267
59278130
Table 2
2003
2004
Increase
Motet 60%
Residents 40%
Rates ..5338
Land tax.. 6579
Water and sew 70.6858013 10,200 87619
2675 3621 16.934
1605
2173
10.1601070
1448
67749332
Weekly Increase ® 35%: 8130 * 88 = 160 * 52 = $1.77: 9 40 %: 9332 * 88 * 52 = $2.03
CPI Increase: $2. 50
On an annual basis and using the calculation as per contract for rent increases, Table 1 shows that using CPI Sundown gains $256.96 per four week month (.73c x 88 x 4); Table 2 Sundown gains $165.44 (.47c x 88 x 4). In my opinion either amount is sufficient to cover the costs of reading 88 meters and preparation of accounts.
Clause 18
The contract has been varied without the written consent of owner tenants.
27. The hearing of the matter lasted the best part of a day during which time the Tribunal and the parties considered in detail the various figures propounded by each party. The Tribunal found as a fact that the CPI increases imposed by the landlord were substantially less than the increase in ACT government charges for the corresponding periods. For that reason the Tribunal found as a fact that the landlord had in fact imposed a rent increase less than the amount which could have been imposed pursuant to clause 15(a) of the lease.
28. The landlord explained the difficulty in using the government charge basis for rent increase, being the problem in identifying each such charge the level of increase in each of those charges. The landlord was prepared to accept the lesser CPI rate of increase.
29. The Applicant ultimately accepted the CPI basis of the charge. The landlord indicated that the other resident had voted to accept the CPI basis in a meeting in 2001, being a meeting that the Applicant alone boycotted.
30. The Tribunal noted that the rent increase notices themselves had not been given in accordance with the lease in that the notice did not give 60 days notice. The Applicant indicated that he did not wish to press this point, but the landlord said that a new notice would be served to avoid doubt. The Applicant specifically eschewed any application to recovery any previous rent paid in accordance with any invalid rent notice.
31. In relation to the electricity supply charges, the Applicant and the landlord had initially agreed to put the electricity supply into the rent and leave the electricity charges to the tenants to be based purely on consumption. The agreement on this point was reversed during the final hearing and the landlord was left to maintain the present practice of providing tenants with a self contained electricity account.
32. In relation to the amount of the electricity supply charge, the Tribunal and parties spent a considerable time reviewing the figures. The Tribunal noted that clause 1 permitted the landlord to impose electricity charges on the tenants in accordance with the published domestic tariff by ACTEW. The published domestic tariff tendered to the Tribunal permitted the charging of both consumption charges and supply charges at fixed rate per paragraph 26(h) above. The evidence of charges actually levied by the landlord on the tenants were in accordance with the published domestic tariff.
33. The Applicant maintained that the imposition of these charges allowed the landlord to make a profit. The landlord admitted that the supply charged levied on the park by ACTEW was less than the sum total of the supply charge collected from the tenants. At the hearing the parties agreed that the landlord needed to recover the supply charge levied by ACTEW. The landlord was also required to hire staff to carry out meter readings on each site; to prepare bills for residents, to collect their money, to pay the money to ACTEW, to maintenance and repair the electricity network in the park.
34. The Tribunal and the parties spend considerable time working through the various competing figures presented by the parties. The Tribunal found as a fact that the supply charge collected by the landlord from the tenants was a reasonable one to account for the above costs.
35. In accordance with its consent mandate to hear and determine the dispute, the Tribunal found:
(a)That the CPI basis for rent increases was valid
(b)That the imposition of the published domestic tariff for electricity supply was valid
(c)That the landlord had not breached the contract saved that the rent increase notices did not afford 60 days notice. The Applicant made no application in relation to rent unlawfully paid.
36. Having made these findings, the Tribunal formally dismissed the application due to its lack of jurisdiction.
37. The Applicant has subsequently sought reasons for the Tribunal’s decision to dismiss his application.
A. Anforth
29 Dec 2005
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