New South Wales District Court
Christine Vivian (appellant)
Macquarie Shores Home Village pty ltd (first respondent)
Malcolm May (second respondent)
This decision stems from an appealed Consumer, Trader and Tenancy Tribunal decision in which the resident applied for a money order in the general division, for $8000, being the difference between the price initially offered by one prospective purchaser, and the purchaser who ultimately bought the dwelling. Ms. Vivan alleged that the difference between the two was “due to the continued assertion and representations made to a prospective purchaser by the authorised representative of the respondent, Mr May that the moveable dwelling had to be sold off-site.”
Ms. Vivian believed these representations were misleading or deceptive or likely to mislead or deceive, within the meaning of the Fair Trading Act 1987 and the Consumer Claims Act 1998. The Tribunal did not agree, and the application was dismissed. The matter was then appealed in the District Court, on the following grounds –
- That the Tribunal had erred in law in failing to give reasons for its decision;
- The Tribunal found that the assertions made by the park owner were not breaches of the contract, nor were they a misrepresentation within the meaning of the Fair Trading Act 1987.
In broad terms, Ms. Vivian claims that the Tribunal’s written reasons were inadequate, and that the Tribunal was incorrect when it found that the declarations of the park owner that the dwelling could only be sold off site, were not breaches or misrepresentations.
The court found firstly, that although the Tribunal’s reasons were ‘sparse’, there was no obligation or requirement for them to be any more intricate than they were.
On the second point, the original Agreement commenced 1991, prior to the commencement of the Residential Parks Act 1998. This original Agreement contained 2 clauses which the Court found were not inconsistent with the later Parks Act. The Parks Act allows for sales restrictions to be set out in the Agreement. This Agreement had restrictions set out in it, under clauses 7(a) and 7(b). They read –
7(a)
“No tenant shall sell or transfer his/her or their interest in any portion of the Village facilities assigned to their use. Owners of mobile homes that are to remain in the Village may not sell their mobile home without first securing approval from management in writing for their mobile home to be sold (as to conditions, landscaping, village standards et cetera) and must also secure management’s approval of the prospective buyer. Tenants may of course sell their homes themselves or may avail themselves of an independent brokerage service.”
And 7(b) –
“Any mobile home that shows visible obsolescence, is in a rundown condition or is in disrepair and/or which utilises facilities that are to be reassigned, shall be removed from the Village. Only with the written consent of the management may the mobile home remain in the Village and then only by being modernised so as to be similar to present day manufactured relocatable homes.”
7(b) is supported by the later Section 99 of the Residential Parks Act 1998, which allows the park owner to serve a resident with a notice of termination if the dwelling is dilapidated.
7(a) is supported, in part, by Section 82 of the same Act –
“82 Restrictions on sale on-site
(1) A residential tenancy agreement under which the residential premises consist of a residential site only may set out any restrictions on the sale of a relocatable home or other moveable dwelling while it is installed on the residential site. Any other such restriction that the park owner purports to impose is unenforceable.
(1A) A provision of a residential tenancy agreement that sets out a restriction of the kind referred to in subsection (1) is unenforceable unless notice of the restriction has been duly given pursuant to section 73 (2) (f).
(2) A park owner must not interfere with the sale, by a resident of the residential park, of a moveable dwelling while it is installed on a residential site.
Maximum penalty: 20 penalty units.
(3) However, it is not unlawful for a park owner to interfere with the sale of a moveable dwelling if such interference is permitted under a residential tenancy agreement.
(4) Without limiting the operation of this section, a park owner interferes with the sale of a moveable dwelling if the park owner unreasonably restricts potential buyers from inspecting the dwelling.”
So Section 82 allows for sales restrictions to be set out in the Agreement. The original 1991 agreement had sales restrictions set out in it, under clause 7(a). It is noted that Section 73 did not exist in 1991, so it is unlikely that compliance with S.82(1A) would be expected at that time.
That part of the Court’s findings that gives the most cause for concern can be found at paragraph 45, as a summary –
“45. It follows from what I have said, that in my view s 5 applies so that the Residential Parks Act in the present case does not apply because the executor and beneficiary did not reside in the premises as a principal place of residence. That is an end to the matter in the sense that I therefore find that the Tribunal did not make an error of law. However, in the event that I am wrong about that I will consider the other aspects of the legislation.”
The court found that Ms. Vivian, as the beneficiary of the property, had the right to occupy the dwelling as her principal place of residence, but in fact, did not do so, and because of this, failed the application test set out in Section 5 of the Residential Parks Act 1998, namely –
“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.”
If the Act does not apply, then the test for misrepresentation and deceptive conduct must also fail, as there is no statutory protection provided by the Parks Act.
With the greatest respect, ARPRA believes that the Court has misinterpreted the intention of the legislation. A key to this misinterpretation can be found at paragraph 10 of the decision –
“ 10. Later the Minister said:
“It is becoming increasingly obvious that there are so many differences between tenancies in parks and estates and other types of residential tenancies that separate legislative provisions are necessary. The Bill has provisions specifically tailored with the needs of park and estate communities in mind under a stand-alone bill for the first time.”
The principal place of residence test was not inserted into the Parks Act to provide a continuous and perpetual obligation on to the permanent residents of a park. It was inserted originally to distinguish between the different types of tenancies found within a park. The Parks Act was not to provide legislative protection for campers, holiday makers, or any other type of Agreement which was not durable or lacked a long-term intent. It was there primarily to exclude short-term casual occupants. It was established to provide legislative protection for long-term tenancies.
The Parks Act allows for residents to sub-let their premises. As this option is usually utilised when the residents plan an extensive Australia-wide holiday, and intend to be absent from their dwelling for a year or more. It feels more secure, physically and financially, to have someone in their home in their absence.
Does this decision mean that no resident should entertain the idea of going away for a holiday? They run the risk of losing their rights if they do. Indeed, the CCIANSW’s version of the Standard Form of Agreement includes an additional term that obligates the resident to personally occupy the premises. It is arguable that this term contracts out of the Act. Only tenants who are party to a Social Housing Tenancy Agreement have an obligation to personally occupy. Residential Parks are not a form of social housing.
The idea that executors and administrators must personally occupy the premises to fully utilise the rights set out in the Parks Act has far more than a ‘superficial appeal’, if this is the only recourse open to them to fully realise the value of the dwelling.
This decision also extinguishes the right of the estate to sub-let the premises.
If the Parks Act does not apply at all, then what obligation is there on the executor to pay the site rent, given the obligation to pay rent comes from the Act? When the Tribunal terminates an agreement, they must also make an order setting the daily occupation fee payable between termination and possession. This must be done, the Tribunal explains, because the termination order removes the tenant’s obligation to pay rent. In fact, they are not a tenant at all, but merely an occupant, without rights.
The Court has failed to provide an alternative – what legislation, then, covers these arrangements? The Residential Tenancies Act provides for no-grounds notices that are not available to park owners for site agreement under the Parks Act. Suddenly, a house that has been continuously occupied for 20 years, under an agreement in which the resident has been granted the right to occupy as a principal place of residence, has the choice of being removed immediately, or perhaps be the subject of an incontestable 90-day No Grounds Notice. In fact, parliament went to great lengths when rewriting the Residential Tenancies Act to exclude all tenancies within a park. It even expressly exempts dwellings that are subject to the Park Regulations ‘30/30 rule’.
Section 4A of the Residential Parks Act 1998 states –
“4A Objects of Act
The objects of this Act are as follows:
(a) to set out the respective rights and obligations of park owners and residents, including their rights and obligations under residential tenancy agreements,
(b) to establish legislative protection for residents,
(c) to establish procedures for resolving disputes between park owners and residents.”
It makes absolutely no differentiation between heirs and original occupants, sub-lessees, administrators or assigns. At paragraph 42, the court declared –
“This legislation was introduced specifically to give and promote the protection and care of people who live in residential parks who are sometimes in particularly vulnerable financial or other circumstances.”
There is no indication in Section 4A of any such restriction on the protection of the Parks Act. At paragraph 43, the court stated –
“43. The legislation affords very specific and special protection and it is plainly designed to protect those people who are living in residential parks. I do not consider it an anomalous (or unintended) result that a beneficiary who is bequeathed a caravan or relocatable home has different entitlements should they choose to sell rather than live in the home.”
The legislation certainly was designed to protect the rights of people living in residential parks. More specifically though, it was designed to protect the interests of anyone who is a resident of a park. Why place heirs, executors, administrators and assigns within the definition of ‘resident’ if they were not to be afforded the same level of protection? If it was intended to exclude them, as the court seems to imply, an exemption statement would have been much clearer.
The fact is that Section 4A uses the word ‘resident’ at (b), and not the phrase ‘people who live in residential parks’.
Also unanswered is why it took from 1998 until 2012 to find and legally recognise this situation. There have been innumerable dwelling sales between these dates. Notwithstanding the fact that parks cannot discriminate on the basis of age, it is a practical fact that most residents of parks are of retirement age. With the greatest of respect to park residents, there must be a higher ratio of deceased estates within the parks industry, than in a comparable number of private tenancies outside parks. Every resident advocate has had experience with park owners in the past who have attempted to use the death of a resident to remove a dwelling or increase the rent. Parks owners have been historically and spectacularly unsuccessful in succeeding in these ventures. Not any more. What has changed? Nothing.
A new shade of grey does not mean things are now in black and white.
ARPRA does not believe that parliament ever intended to exclude a whole class of resident from the protections of the Parks Act. We respectfully suggest that Olsson J misinterpreted the intention of government when she declared that such an exclusion was not outside the bounds of intent.
In any event, ARPRA requests that the government gives its attention to this decision when drafting the new Residential Parks Act. The heirs of residents can also be ‘particularly financially vulnerable’, and need their inheritance to pay off a funeral.
This decision may leave them with a debt, making them worse off than before, in more ways than one.
ARPRA is of the opinion that this decision lacks understanding and empathy, and must not be allowed to continue under a new Act.