Moran and ORS v The Retreat Manufactured Homes Village (Residential Parks) [2013] NSWCTTT 256 (11 June 2013)

CONSUMER, TRADER & TENANCY TRIBUNAL
Residential Parks Division

APPLICATION NO:	
RP 12/59554 & Ors	

APPLICANT:	
Arthur Moran & Ors	

RESPONDENT:	
Trevnor Pty. Ltd & Papuka Holdings Pty.  Ltd t/as The Retreat Manufactured Homes Village.
	
APPLICATION:	That the rent increase from 1 January 2013 is excessive. That the existing rent is excessive having regard to a withdrawal or reduction in services.
.	
APPEARANCES:	Leslie Wakeling, Alan Wilkinson and Beverley Vigurs for the applicants;
The respondents did not attend.
	
HEARING:	5 April 2013 at Port Macquarie.	

LEGISLATION:	
Residential Parks Act 1998
 (the “RP Act”) sections 53, 55, 56, 57 and 58.
	
KEYWORDS:	Excessive rent increases.
Rent excessive.	

ORDERS

On 5 April 2013 the following orders were made:

1.	Pursuant to Section 58 of the Residential Parks Act 1998, the rent payable by the applicants on rent of $111.50 per week prior to 1 January 2013, is not to exceed the sum of $114.10 per week from 1 January 2013 for a period of 12 months.

2.	Any amount of rent which has been overpaid as a result of order 1 is to be credited to the applicants’ rent account.

3.	The amended application which sought an order that the existing rent is excessive having regard to the reduction by the park owner of a service, is dismissed.

REASONS FOR DECISION

1.	These written reasons are requested by the applicants, pursuant to s 49 (2) of the Consumer Trader and Tenancy Tribunal Act 2001 (the “CTTT Act”). The Tribunal on 5 April 2013 provided oral reasons for its decision. The applicants were present at the hearing on 5 April 2013.

2.	The Tribunal received 55 applications which claimed that a proposed rent increase for sites at the Retreat Manufactured Homes Village (“The Retreat “) in Port Macquarie, were excessive. By way of a submission received on 3 April 2013, the applicants sought a further order that the existing rent was excessive because of a withdrawal or reduction of a service by the park owner. The applications were all listed for hearing at Port Macquarie on 5 April 2013.

3.	As the respondent was not present at the hearing, the Tribunal was unable to attempt to conciliate the matters, and thus the matters proceeded by way of an ex-parte hearing.

4.	Leslie Wakeling of the Affiliated Residential Park Residents Association Inc  was granted leave to represent the applicants.  Ms Wakeling was assisted in this process by Alan Wilkinson and Beverley Vigurs. Although the respondent was not represented at the hearing, the respondent on 24 March 2013 and 4 April 2013 wrote to the Tribunal and presented arguments in regards to the applicants’ allegation that the existing rent was excessive because of the withdrawal or reduction of a service by the park owner. The respondents’ comments in the two letters were considered by the Tribunal in determining that issue.

5.	The Tribunal was provided with a copy of the applicants’ documents.

6.	The applicants each occupy a site within “The Retreat” upon which is located their own relocatable home and which is occupied as their principal place of residence. The parties have each entered into a “residential site agreement" under the “RP Act”. Schedule 1 of the “CTTT Act” establishes that the Tribunal’s jurisdiction in respect of any matters arising under the “RP Act” is to be exercised in the Tribunal’s Residential Parks Division. The present matters have proceeded in the Tribunal’s Residential Parks Division, therefore the Tribunal has jurisdiction to hear and determine the applications.

7.	There are 193 sites in the park and 55 of these residents have made 
applications to the Tribunal seeking orders. Generally the applications are of a pro forma type and each seeks the same orders. The orders sought are:

•	An order pursuant to section 55 of the “RP Act” that the rent increase notified in the notice dated 25 October 2012 is excessive;

•	An order pursuant to section 57a-k of the “RP Act” that the rent increase is excessive;

•	An order pursuant to section 58 (1 and 2) declaring the proposed rent to be excessive and specifying an amount the rent must not exceed for a period of 12 months from the date of the orders.

8.	By way of a submission received by the Tribunal on 3 April 2013, the applicants sought further orders, being:

•	An order under section 56 (1) (A) declaring that the current rent payable and the current rent increase of $7.20 is excessive.

9.	The notice of the increased rent payable under each residential site agreement was dated 25 October 2012. It required the increased rent to be payable from 1 January 2013. 54 of the applications were lodged together and within the time allowed under section 55 of the “RP Act”. The other application, being RP12/62161 – Barry Gain was lodged on 7 December 2012. Although this application was lodged outside the time allowed under section 55 of the “RP Act”, The Tribunal granted leave under section 81 (1) of the “CTTT Act” to extend time in which to lodge the application.

10.	Of the 193 sites in the park, 92 residents received a rent increase of $2.30 pw, 46 residents with CPI  clauses in their residential site agreements, received a rent increase of $2.60 pw, and the 55 residents, who have applications before the Tribunal, received a rent increase of $7.20 pw.

11.	Section 57 of the ‘RP Act” sets out the factors to which the Tribunal may have regard in determining whether a rent increase payable under a residential tenancy agreement is excessive. As stated above, the applicants have presented considerable evidence on the matters. By way of a letter of 12 March 2013, the respondent comments generally on the levels of rents within “The Retreat.” But no attempt has been made in the letter to address the factors under section 57 of the “RP Act”

General market level of rents for comparable premises (section 57(a)).

12.	In my previous decision regarding “The Retreat”, being RP11/59128 I noted three other comparable parks. In the present case I have been provided with rents for only two of those parks, as well as “The Retreat” The rent details are:

Dalhsford Village				$111.00  to $118.00
Newport Village				$110.00  to $125.00
The Retreat					$108.60  to  $125.00

13.	I accept the applicants’ argument that the rent paid by new residents, does not establish the general market level of rent within “The Retreat”. It is my position that a number of factors contribute to the disparity of the rents within “The Retreat”, and some of these factors are of the respondents’ making.

Value of the Residential Premises (section 57 (b)).

14.	Nothing turns on this factor.

Frequency and amount of past increases (section 57(c)).

15.	The evidence is that from 2003 to 2010 the increases were usually in January each year and generally in line with the prevailing CPI the last two years have seen higher rent increases sought by the respondent, and this has resulted in orders being made by the Tribunal.

The conduct of the parties (section 57(e)).

16.	The applicants have talked of very limited maintenance or upgrade of the park by the respondent over an extended period of time. The applicants also raise the reluctance of the respondent to meet with the residents’ representatives to discuss these issues. The arguments advanced under this factor are not directly relevant in my determination of the dispute before me.

Amount of any Outgoings (section 57 (f)).

17.	Although the applicants have made an attempt to address this factor, it is difficult for them to adequately do so. It is my position that this factor presents a clear opportunity to the park owner to argue support for the proposed rent increase. The park owner has chosen to submit no evidence whatsoever on this factor.

Section 57 (g) (h) (i) (j).

18.	The residents have submitted limited evidence / argument on these matters. The factors have little influence on my determination as to whether the notified rent increase is excessive.

Any other Relevant Matter (57 (k)).

19.	The applicants have submitted comments of the conditions in the park over a number of years, and the alleged failings of the respondent to undertake repairs and improvements to the park.

Conclusions

20.	The factors under section 57 of the “RP Act” which the Tribunal may take into consideration are not ranked and none of the factors is declared to be predominant.

21.	The Tribunal’s role is to take into account the evidence presented in relation to the section 57 factors, and to determine on the balance of probabilities, whether the proposed rent increase is excessive.

22.	On considering all the evidence, the more relevant factors appear to me to be:

•	Comparable residential parks and their rents payable per week are:

•	The Retreat			$108.60 to $125.00

•	Newport Village			$110.00 to $125.00

•	Dalhsford Village		$111.00 to $118.00

23.	I note that $125.00 does not represent the general market level of rent in “The Retreat”

•	The relevant CPI increase is 2.3 %. When applied to an existing rent of $111.50 pw, which is the rent paid by the 55 applicants, this equates to an increase of $2.56 say $2.60.

•	No evidence on outgoings has been tendered by the respondent

•	The proposed increase of $7.20, on an existing rent of $111.50 making an increased rent of $118.70, represents an increase of 6.45 %.

24.	Having considered all the evidence, I am satisfied that the proposed rent increase exceeds the CPI (All Groups) for Sydney, and is beyond the normal or usual. I declare that the rent increase is excessive.

25.	The evidence before me gives no cause to increase the rent beyond the relevant CPI, which equates to a rent increase of $2.60. This results in an increased rent of $114.10 pw.

26.	I cannot concede to the applicants’ request that I apply the lowest increase of $2.30 pw given by the respondent to some residents in the park. It is my position that section 58 (2A) of the “RP Act” precludes me from being able to do this.

27.	Therefore the rent is not to exceed $114.10 from 1 January 2013 for a period of 12 months. Any overpaid rent is to be applied as a credit to the applicants’ rent account.

28.	I turn now to the issue of the alleged reduction or withdrawal by the park owner of a service, being the on-site manager, and the applicants’ claim that the existing rent is excessive.

29.	The evidence presented causes me to conclude:

•	The previous park manager, P. Bates appears to have worked in the park office for approximately 15 hours per week. Beyond this, P. Bates resided on site, but only provided an after-hours, “on call” service,

•	The new management arrangements appear to be that the new manager is in the office for about 30 hours per week. Beyond this he lives off site and provides an “on call” service

•	One testimony on the new management arrangements, suggests the manager responded promptly to an “on call” situation

•	I am less convinced as to the management contribution of Mr Webb, one of the Directors.

30.	The park owner does not have a legal obligation to provide an on- site manager, and is free to manage the park as it thinks fit, so long as there is not a reduction or withdrawal of a service which impacts adversely on the residents.

31.	I understand the residents’ concerns as to a potential emergency situation in the park, however I am not satisfied that the altered management arrangements make such a situation more likely, or less manageable than the previous arrangements.

32.	I do not find on the evidence, a reduction or withdrawal in the management services provided at “The Retreat.”  This claim by the applicants fails and is dismissed.

33.	Orders are made to give effect to my determinations.

.
Mark Gilson
Member 
Consumer, Trader & Tenancy Tribunal

11 June 2013