Civil and Administrative Tribunal New South Wales

• Medium Neutral Citation: Tricare (Hastings) Pty Ltd v Sue Allen and Ors [2014] NSWCATCD 162
• Decision date: 02 September 2014
• Before: G. Bassett, General Member

Decision

1. The site agreement of each of the residents, except Phillip Tucker on Site 39, is terminated immediately.

2. Each of the residents, except Phillip Tucker on Site 39, is to give vacant possession of their site on, or before 20 September 2016.

3. The site agreement of Phillip Tucker of Site 39 is terminated immediately on the day the park owner gives written notice of an occupation certificate for Stage 2 of the development and vacant possession is to be given immediately.

4. Each of the residents is to be paid compensation prior to delivering up vacant possession as follows:

(a) Site 39 - $53,000

(b) Site 51 - $85,000

(c) Site 54 - $27,000

(d) Site 58 - $56,000

(e) Site 59 - $62,000

(f) Site 60 - $93,000.

• Catchwords: site agreement, statutory interpretation, termination, compensation, purpose, residential
• Legislation Cited: s 56(1) Civil Procedure Act 2005; s 3(c) Consumer, Trader and Tenancy Tribunal Act 2001; ss 102, 113, 128, 130 Residential Parks Act 1998 ("RPA"); Manufactured Homes (Residential Parks) Act 2003 Qld; Residential (Land Lease) Communities Act 2013; Residential Parks (Statutory Review) Bill 2005
• Cases Cited: Haraba P/L v Castles [2007] QCA 206; Meggitt Overseas Limited v Grdovic (1998) 43 NSWLR 527; Tricare (Hastings) Limited v Tweed Shire Council [2013] NSWLEC 183; Sydney City Council v Ke-Su Investments Pty Limited [1985] 1 NSWLR 246
• Category: Principal judgment
• Parties: Applicant: Tricare (Hastings) Pty Ltd; Respondents: Sue Allen, Kevin and Lorraine Byng, Bob and Helen Vermills, Phillip Tucker, Judy Tucker, Beryl Anderson
• Representation: Applicant Dr S Berveling; Respondents Ms M McMahon; Applicant, Gary Oldman Minter Ellison Lawyers (not present at hearing days); Respondents, Paul Smyth Tenants' Union of New South Wales
• File Number(s): RP 13/34740 & Ors

reasons for decision

Procedural History

1 The application was filed on 24 June 2014. Initially, the applicant sought orders that the respondents deliver up vacant possession of their respective residential sites at Hastings Holiday Park.

2 As set out in the initiating application, reasons for requesting the orders were as follows:

(a) the Park Owner was developing the park into a "staged seniors living development" in accordance with a development consent dated 14 March 2007 and modified on 25 March 2010

(b) pursuant to the development consent the residential sites were to be used for a purpose other than as a residential site

(c) a notice of termination was sent to each resident dated 21 May 2012 and specified 27 May 2013 as the date to deliver up vacant possession. At the date of application each of the respondents had failed to deliver up such possession.

3 The matter came before me on 26 July 2013. It was adjourned so that a declaration could be sought from the NSW Land and Environment Court "LEC") that the sites subject of this Tribunal claim were included in the development approval underpinning this claim. The applicants undertook to notify the Tribunal at least 14 days before 1 November 2013 as to the status of the LEC application. The parties were granted leave to appear by telephone at any further directions hearing. Leave was granted for parties to be legally represented. The park owner or a representative was authorised to access sites on, or before 22 August 2013 for the purpose of carrying out an appraisal for compensation. Residents were directed not to obstruct such access.

4 On 13 November 2013 the matter came before me once again. The parties indicated His Honour, Justice Biscoe of the LEC, passed judgement on 31 October 2013. He made a declaration that the sites in this application were part of the development approval. However, the respondents' legal representative indicated that this decision was likely to be appealed but as at 13 November no Notice of Appeal had been filed. Directions were made as follows:

(a) the matter was adjourned for formal hearing after 1 March 2014 if no Notice of Appeal was filed by 28 November 2013

(b) respondents were to file and serve evidence in relation to the cost of relocating the dwellings to new sites and the applicants were to file any evidence in reply

(c) parties were to also file and serve written submissions

(d) if no Notice of Appeal was filed and served by 28 November 2013, the parties were not required to comply with the direction made but were to approach the registry for a further direction hearing to be set as soon as possible.

5 The respondents' legal representative wrote to the Tribunal registry on 5 February 2014 after a notice of hearing had been received with dates for hearing set for 10 and 11 March 2014. Respondents asked that the hearing dates be vacated and the matter be listed for a further direction hearing by telephone. Reasons given for vacating the hearing date were that a Notice of Intention to Appeal had been filed on 27 November 2013. Respondents contended this notice stayed the Tribunal proceeding. They further indicated an application had been made to Legal Aid but no decision yet made. Further, counsel briefed for the appeal by the respondents at that time had only recently returned to chambers and needed further time to advise on the prospects of any appeal.

6 In a letter to the Registry dated 6 February 2014, solicitors for the applicant objected to the request to vacate the hearing date. They said the direction made by me on 13 November 2013 required a Notice of Appeal to be filed by 28 November 2013, not a Notice of Intention to Appeal. They also argued that respondents were in default of the direction to file and serve evidence in relation to the cost of relocating sites.

7 I refused the respondents' application for an adjournment and vacation of the hearing dates. Reasons given were as follows:

The respondent applicant for adjournment asserts that by having filed and a Notice of Intention to Appeal on 27 November 2013 the hearing set for 10-11 March 2014 ought to have been set for a further directions rather than allocated hearing dates. The respondents' legal representative did not write to the Tribunal until 5 February 2014 to have the hearing dates vacated. Respondents would have been aware that the Notice of Intention to Appeal had been filed and served over 2 months earlier. In any event, r 51.9 of the Uniform Civil Procedure Rules states that an applicant who has filed and served a notice of intention to appeal must file and serve the relevant originating process on each party within 3 months after the material date or within such other period as the Court may order. No evidence has been provided to indicate the Court ordered another period to the material date. The material date is 3 months from the date of the decision being appealed. The decision being appealed is that of Justice Briscoe [SIC] in the Land and Environment Court on 31 October 2013. The material date for filing and serving the relevant originating process in support of the Notice of Intention to Appeal would have lapsed on 31 January 2014. No evidence was supplied by the respondent applicant for an adjournment of the relevant originating process having been filed and served by that date.

The Applicant in the substantive matter also objects to the application for an adjournment and submits that r 51.9(3) of the UCPR does not operate to commence proceedings in the Court of Appeal. It submits that the intent of the directions made on 13 November 2013 were for the matter to go to hearing if the appeal had not be substantially progressed.

8 On 3 March 2014 the respondents applied for an urgent directions telephone hearing. That request was granted and appearances were by telephone. At that hearing respondents were directed to file and serve any evidence they wished to rely on at the hearing on, or before 10am on 6 March 2014.

9 At the hearing on 10 March 2014, Phillip Tucker was granted leave to be legally represented by the representatives of the other respondents. An inspection of the park and comparable parks was held during the hearing on 11 March 2014. The matter was part-heard on 11 March. Directions were made for the parties to lodge and serve any further evidence to be relied on and written submissions.

10 The matter was set for further hearing on Tuesday, 13 May 2014. On 3 April 2014 the respondents again applied to vacate the hearing date as their barrister was unavailable. The date of the balance of the hearing was moved to 27 May 2014. At the end of the hearing the parties were given time to lodge any further written submissions.

11 On 3 June 2014 Tricare lodged further written submissions.

12 In written submissions handed up at the end of the formal hearings, the applicant submitted the following orders would be appropriate:

(e) that the residential site agreements between the park owner and the respective residents be terminated

(f) that the respondent residents respectively give up vacant possession of the residential sites on which their relocatable home is located, on or before a particular date

(g) a determination that the value of the respondent residents' respective dwellings is as follows [in accordance with the valuations provided by Kelvin Price in Exhibit A3]

(h) that the Applicant Tricare (Hastings) Limited buy the residents' respective dwellings at an amount no less than the value of those respective dwellings as set out in determination (c) above.

SCHEDULE OF PARTIES

13 I provide a schedule of the residents, their respective site numbers and the valuation of Mr Price at paragraph 15 of Exhibit A3:

A	B	C	D
File Number	Site Number	Party Name(s)	Mr Price Est selling price range for dwelling located at the site
RP 13/34740	60	Bob and Helen Vermills	$71,000-$78,000
RP 13/34741	59	Beryl Anderson	$41,000-$47,000
RP 13/34743	39	Phil Tucker	$34,000-$38,000
RP 13/34744	51	Judy Tucker	$65,000-$70,000
RP 13/34745	54	Kevin and Lorraine Byng	$10,000-$12,000
RP 13/34746	58	Sue Allen	$38,000-$41,000

JURISDICTION

14 Section 102 of the Residential Parks Act 1998 ("RPA") is as follows:

102 Termination by park owner for change of use

(1) A park owner may give notice of termination of a residential site agreement to the resident on the ground that the residential site is to be used (whether by the park owner or some other person) for a purpose other than that of a residential site.

(1A) Notice of termination may not be given on the ground of a change of use that requires development consent under the Environmental Planning and Assessment Act 1979 unless development consent for the proposed use has been obtained under that Act.

(1B) Notice of termination may not be given on the ground of a change of use that does not require development consent under the Environmental Planning and Assessment Act 1979 unless consent for the issue of the notice has been obtained under section 102AA.

(1C) Within 7 days after giving a notice of termination under this section, the park owner must cause written notice of that fact to be given to the Director-General of the Department of Housing.

(2) A notice of termination in respect of a residential site must not specify a date for vacating the residential site earlier than:

(a) 12 months after the day on which the notice is given, or

(b) in the case of an agreement that creates a tenancy for a fixed term, the day following the date on which the fixed term ends,

whichever is the later.

(3) A resident to whom a notice of termination referred to in subsection (2) is given may, within 60 days after receiving the notice, apply to the Tribunal for an order postponing the date for vacating the residential site.

(4) A notice of termination under this section must include the following statements, either in the body of the notice or in a separate document accompanying the notice:

(a) a statement to the effect that the resident is not required to deliver up vacant possession of the residential premises until ordered to do so by the Tribunal,

(b) a statement to the effect that the resident may be entitled to be paid compensation under section 128 which, if payable, must be paid in full before the resident is required to deliver up vacant possession,

(c) such other statements as may be prescribed by the regulations.

(5) A resident whose residential site agreement is terminated under this section is entitled to be paid compensation by the park owner in accordance with section 128.

(6) Compensation is not payable in respect of a residential site agreement for a residential site situated within a Crown reserve (being an agreement entered into after 16 December 1994) if:

(a) the resident is informed (when the agreement is entered into) that there is no right of compensation in the event that the agreement is terminated under this section, and

(b) the purpose for which the agreement is terminated is for the residential site to be used for a public purpose other than that of a residential site.

15 Each of the residents was given a termination notice with a date for possession in 2013. Other than whether the Tribunal ought to terminate at all as submitted by the respondents, which is addressed later in this determination, no issues were raised as to the validity of the notices.

16 Relevant provisions of s113 of the RPA state:

113 Application to Tribunal by park owner for termination and order for possession

(1) If:

(a) a park owner or a resident gives notice of termination of a residential tenancy agreement under this Part, and

(b) the resident fails to deliver up vacant possession of the residential premises on the day specified,

the park owner may, not later than 30 days after that day, apply to the Tribunal for an order terminating the agreement and an order for possession of the premises.

(2) The Tribunal must, on application by a park owner under this section, make an order terminating the agreement if it is satisfied:

(a) in the case of a notice given by the park owner on a ground referred to in section 98, 99, 100, 101, 102, 104, 105, 106 or 110:

(i) that the park owner has established the ground, and

(ii) if the ground is a breach of the residential tenancy agreement, that the breach, in the circumstances of the case, is such as to justify termination of the agreement, or

(b) that the resident has seriously or persistently breached the residential tenancy agreement, or

(c) that, having considered the circumstances of the case, it is appropriate to do so.

(3) Except as provided by section 115, the Tribunal must not make an order terminating a residential tenancy agreement under this section unless it is satisfied that notice of termination was given and that it was given in accordance with this Part.

(3A) The Tribunal must not make an order for possession as a consequence of an order terminating a residential tenancy agreement pursuant to a notice given by the park owner on the ground referred to in section 102 (Termination by park owner for change of use) unless it is satisfied that:

(a) compensation for the cost of relocating the dwelling to its new location has been determined under section 128, or

(b) the park owner has agreed to buy the dwelling from the resident at a price no less than its value, as determined by the Tribunal under section 130A, or

(c) the park owner and the resident have reached an acceptable negotiated settlement, and that agreement is bona fide.

(4) If the Tribunal makes an order under this section terminating a residential tenancy agreement:

(a) the Tribunal must also make an order for possession of the residential premises specifying the day on which the order takes effect, and

(b) the Tribunal may, if the circumstances of the case so justify, also make an order that the resident not be a resident under any other residential site agreement in relation to the park and not be a resident of any other residential premises in the residential park.

17 The Tribunal is satisfied the Notices of Termination were issued to residents in accordance with this part. Further, consideration of the factors in s 113(3A) are central to this application. While s 113 refers to residential tenancy agreements, it was common ground that this application related to residential site agreements. The Tribunal has jurisdiction to hear the matter.

ISSUES IN DISPUTE

18 There were legal and factual issues in dispute in the matter.

19 The main legal issue is what method should be adopted for calculating compensation if a compensation order was made. This raised principles of statutory interpretation about which the parties' legal representatives did not agree. Ms McMahon submitted that the Act does not allow the Tribunal to make an order for termination as it cannot make an order for compensation. Consequently, the application for termination should be dismissed and the matter be brought back to the Tribunal under the new Act. Each made different submission on what statutory interpretation principles I should adopt.

20 Factually the main issues were:

(a) what the amount should that compensation be, if any

(b) the value of the residents' respective dwellings, and

(c) the date on which orders for possession are to take effect.

21 It was common ground between the parties that the dwellings could not be relocated.

EVIDENCE OF THE APPLICANT

22 Written evidence of the applicant that was tendered at different times over the hearing days was:

(a) affidavit of Peter Joseph O'Shea sworn 20 June 2013 accompanied by 2 folders of exhibits tabbed 1 through 12 to12.18, 12 A to 12 R and 13 through 15 - Exhibit A1

(b) affidavit of Peter Joseph O'Shea sworn 3 March 2014 - Exhibit A2

(c) affidavit of Kelvin Price sworn 7 March 2014 - Exhibit A3

(d) copy of the NSW Court of Appeal decision Hastings Point Progress Association Inc. v Tweed Shire Council [2009] NSWCA 285 (11 September 2009) of 11 September 2009 - Exhibit A4

(e) results of Applications for Leave to Appeal to the High Court of Australia dated 12 February 2012 - Exhibit A5

(f) table of appraisals of value of other sites, amounts paid to each resident at other sites and legal costs of applicant - Exhibit A6

(g) expert report Herron Todd White dated 25 March 2014 assessing value of each dwelling - Exhibit A7

(h) affidavit of Amy Elizabeth Southwell sworn 14 April 2014 with various annexures - Exhibit A8

(i) letter of Tricare dated 26 May 2014 setting out offers as to a purchase price for each of the respondent's dwellings - Exhibit A9

Evidence of Tricare Director, Mr O'Shea

23 In his first affidavit Mr O'Shea outlined the background of the matter. In 2007 development consent was granted to a prior owner of the park and amendments of that consent allowed the applicant to develop aged care facilities for a seniors living development, in four stages. The first 3 stages involved the construction of the buildings and Stage 4 related to vegetation of a buffer zone between the buildings and Cudgera Creek to the west. By hearing, Stage One was completed. Twelve of the long-term sites of Hastings Point's Caravan Park fronted Cudgera Creek. The applicants in this proceeding are 5 remaining site residents of the sites fronting Cudgera Creek in the buffer zone. The Stage Four vegetating of the buffer cannot be completed until the creek sites are vacated. Each of those residents was given a Notice of Termination as mentioned above.

24 In 2013, Mr O'Shea obtained market appraisals for the "value of dwelling homes". Rather than relocate the homes, the park offered to buy out homes at figures indicated in Mr O'Shea's second affidavit (Exhibit A2) and the evidence of Mr Price (Exhibit A3). At paragraph 5, Mr O'Shea summarised results of the appraisals and Mr Price also did this at paragraph 15 of his report. These values are outlined in Column D of the Schedule at paragraph 17 to this determination. A value was given as if the resident purchased a new home direct from the factory. These ranged from $60,000 to $135,000. A figure was also given as to the estimated selling price of each of the dwellings if the residents sold them in an "as is" condition and still on the site. These ranged from $21,000 to $78,000. Notably, these appraisals were for the cost of securing a new dwelling from a manufacturer and the value of selling the dwelling on site. No allowance was made for the value, if any, of the dwelling being subject of a site agreement or being relocated to a site other than under a site agreement. No allowance was made for the cost of purchasing a new dwelling covered by a site agreement at a comparable park.

25 At paragraph 18 of his second affidavit, Mr O'Shea indicated offers made by the Park to each of the residents and counter offers. Offers ranged between $17,500 and $74,500 while counter-offers ranged from $35,500 to $255,000.

26 In cross-examination he was asked about funds that had been allowed for relocation of the residents. Mr O'Shea was shown a letter of 19 May 2011 from the applicant to the then owners of the park which proposed 2 options for the sale to proceed. The first option was that the sale contract price be reduced by $1.5 million to compensate Tricare if it accepted responsibility for relocation and compensation of residents. The second option allowed for a $2.5 million relocation fund to be put into a trust account by the vendors if they undertook obligations for relocation and compensation of residents. Mr O'Shea said he was not sure what option was adopted on sale though he understood it to be the first option. He undertook to find this out.

27 He also stated he did not know the amounts paid to other residents who had settled with the park owner and was unaware if it was a sum of $432,000 paid to the others. Ms McMahon called for documents in relation to the relocation fund and Mr O'Shea undertook to locate them if possible.

28 On the second day of hearing Mr O'Shea answered the call for documents. In general I found Mr O'Shea to be a very competent and reliable witness who made concessions where they needed to be made and assisted the Tribunal by making evidence available when it was called for. A Table of Offers to other residents was tendered. A letter of 7 June 2011 was produced as well as the contract between the parties for the sale of the park. The final contract price was indicated to the Tribunal but the contract document itself was commercial in confidence and not tendered. Residents in the public gallery were asked to wait outside the hearing room while evidence on the commercial in confidence issues was adduced. They returned to the hearing room when the Table of Offers with other residents was the subject of evidence.

29 Mr O'Shea's evidence was reopened and he gave oral evidence-in-chief. With respect to the missive of 19 May 2011, he said the letter formed part of sale negotiations between the parties. Its weight should be considered in light of the fact that the aim of the letter was to beat down the asking price.

30 Further negotiations were held after that correspondence and a further letter was sent on 7 June 2011. In it, the vendors suggested $960,000 as a fair compensation amount. Mr O'Shea said that at the time a vendor party wanted 2 units in any new development. The offers in the letters contained an incentive for him to sell without getting the units. The 7 June letter also raised the issue of structural defects at the property and was a "take it or leave it" offer to take into account these defects and Tricare taking on responsibility for compensation of the residents.

31 Mr O'Shea said the Table of Offers included the legal costs of the LEC hearing. He conceded that some residents were paid more than the sum their site was appraised for. A resident was also paid more if he or she moved their own structure. In cross-examination Mr O'Shea said if homes were left on site they were sold to third parties. He said little of the total sum paid for those residents who had settled was recouped from these sales.

Evidence of Mr Price - Market Appraisals

32 Mr Price was a licensed real estate agent who prepared the market appraisals referred to by Mr O'Shea. He indicated he was a specilaist in the sale of residential park sites.

33 He stated the park no longer provides any real services to residents and this greatly reduced the value of dwellings sold in situ. To calculate the cost of dwellings he located the list price for a comparable new home. He then reduced the price of the residents' homes by accounting for the age, a dwellings depreciable value over 40 years and any renovations that had been done in the respondents dwellings.

34 Mr Price indicated there were no relocatable sites at other parks in the area and he had sold over 200 manufactured homes in the area.

35 The value of a dwelling was greatly increased when measured against a site in an established village with services and amenities. Conversely, the value of a dwelling is significantly reduced if it has to be removed form a park because it loses the benefit of being in a park.

36 In cross-examination he conceded:

(a) park owners now preferred to purchase homes from the manufacturer and let these out rather than have residents who bring their own homes

(b) that if one of the resident's homes had been located in a comparable park subject of the inspection held during hearing, the cost to purchase the dwelling with a site agreement would be $290,00 in one park and between $70,000-$135,000 in another

(c) that he assumed that manufactured homes in Hastings Park had to be vacated and purchased by a third party and he did his valuations as if the homes were "removed from the park and then auctioned off in a car park"

(d) additional value in comparable parks in the area was due to better facilities than those at Hastings Point park

(e) that he had first visited Hastings Point park in June 2013 and not "in its heyday" when all facilities had been intact. Further, he only knew of the park's "heyday" from what the residents had told him

(f) about 6 weeks prior to hearing day he had sold a waterfront, corner block, 12-year old home in a nearby park for $159,000

(g) that comparable prices of a manufactured home in a park he had recently visited ranged between $98,000 and $132,000.

(h) a waterfront aspect added a premium of up to $20,000 to the value of a home.

37 In re-examination he stated that two sales of homes in a nearby park with extensive facilities including a pool, use of tourist facilities by permanent residents, gymnasium, sauna, lap pool, tennis court and Jacuzzi were for $117,000 and $133,000. The environment of the park was a significant factor in the selling price.

Report of Herron Todd White

38 Mr Brown gave evidence in relation to the expert report of Herron Todd White (Exhibit A7). He stated that in his report he valued sites retrospectively as at 2007 and as they were in situ at the time of hearing. The 2007 values ranged between $20,000 and $70,000. Current values ranged from $10,000 to $15,000 except Site 54 which the reporter opined to be of nil value.

39 Assumptions in the 2007 valuations were that park facilities were "average" at that time and that all dwellings met compliance standards and were relocatable and each residence was subject to a site agreement. The year 2007 was chosen as a value point as this was prior to the grant of development for the staged aged care.

40 In cross-examination he conceded:

(a) there was no report on relocation costs

(b) the park was currently in poor condition compared to others in the area and this would lessen the current value

(c) he had been shown the appraisal of Mr Price

(d) dwellings were thinly traded assets and difficult to value

(e) the reporter had no first-hand experience of parks in the area in 2007 and gathered his information form the report form discussion with the park owner, the owners other parks in the area, other real estate agents in the area and consideration with other unnamed and unidentified "experts"

(f) the letter of instructions of the report did no instruct to give 2007 values and the reporter took it upon himself to do this

(g) direct comparable sales was the best method to value sites.

41 Mr Brown was unable to assess value at the date sought for vacant possession on 16 September 2016. When asked to assume that the amenities were similar to those in other parks in the area, he would not give a valuation and refused, despite repeated questioning from Ms McMahon, to make the required assumptions. He denied that he spoke to one of the residents when he was doing his report and said he would estimate current market value as if all the former facilities at the park were in place and operating.

EVIDENCE OF THE RESPONDENTS

42 The written evidence relied on by the respondents included:

(a) judgement of His Honour Biscoe J in Tricare (Hastings) Ltd v Tweed Shire Council & Ors [2013] NSWLEC 318

(b) extract from transcript of proceedings dated 24 October 2013 from LEC evidence of Ms Denise Galle

(c) HMC Environmental Consulting Pty Ltd Compliance Report Caravan Park dated March 2007

(d) Statement of Environmental Effects

(e) Tweed Shire Council aerial photograph dated May 2012

(f) plans TP, ST01 ST02D and ST03C all stages completed

(g) licence issued to park pursuant to s68 Local Government Act 1993 issued to Tricare dated 20 September 2013

(h) correspondence from Tricare dated 19 May 2011

(i) letter dated 1 March 2006 form then park owner to residents

(j) emails from Sue Allen to various other parks enquiring whether any sites were available and replies from some parks

(k) Statements of residents of Bob Verrills, Beryl Anderson, Phillip Tucker, Kevin and Lorraine Byng, Susan Allen, Judy Tucker

(Items (a) to (k) Exhibit R1 collectively)

(l) letter dated 7 June 2011 from applicant to Managing Director of vendor indicating revised offer to purchase the property - Exhibit R2

(m) expert compensation assessment report dated 20 March 2014 of a certified practising value - Exhibit R3

(n) copy of letter dated 24 March 2014 from applicant's solicitors consenting to late service of any remaining evidence in the proceeding.

43 The evidence of the residents was largely repetitive. They stated they had been led to believe they would stay at the park after development and would be there "indefinitely". One resident stated they thought their site was "never to be sold and to stay in the family". Evidence was given about offers and counter offers for compensation. Some residents were concerned at being relocated as they faced health issues and had heath care contacts in the area. They were shocked when given the termination notice by the applicant. They had applied for sites at other parks. They could not afford to buy another manufactured home on a comparable site with the money being offered to them by the park as compensation. In cross-examination some admitted they were active in the progress association formed to challenge the park owner in the LEC over the question of whether the development grant applied to their sites.

44 Phil Tucker indicated the LEC ordered him to vacate when a construction certificate was supplied for Stage 2 of the development.

45 The residents indicated there had been many communications with the park once the change of use to an aged care facility was notified. A letter from the prior park owner stated that the change would "in no way affect your living in this Park and not anyone, and I repeat, not anyone, will need to vacate our Park". The letter suggested there may be relocation of residents within the park.

46 In the extract from the transcript of the LEC proceedings on 24 October 2013 from LEC evidence a town planner who assisted in the development application stated that all "creek front sites could remain indefinitely".

47 The applicant became the new developer in 2011. It was at that point matters changed markedly. The development stages 1 to 3 had been completed. Only Stage 4 remained and, the residents submitted, each creek front site was to be developed only when it became available. The only resident not on the creek front was Phil Tucker and his site and any date for him to vacate was unclear.

48 At the site visit to the park and comparable parks on 11 March, the legal representatives for the parties put their cases in a nutshell. The park owner contended that compensaiton is only for the building - only for the chattel and for it to be moved out of the park to somewhere else. Respondents argued compensation should be in an amount that would place them in a park with a comparable standard.

49 At the visit to the park I inspected each of the residences and noted their characteristics. However, I note Mr Price did this in his report and allowed for the condition of each the dwellings in his report and his findings as to the condition of each dwelling are more reliable than my observation.

50 In respect of the visits to comparable parks the respondents drew attention to:

(a) a new residence with a similar site size and a lot of road noise that had sold recently for $240,000

(b) residences of unknown age that sold for $150,000, $215,000

(c) a 19-year-old residence that sold for $220,000.

51 Mr Rutledge also provided a valuation report. In his evidence-in-chief he said the report was based on assumptions given on 17 March 2014. These assumptions were:

(a) The dwelling was subject of a continuing site agreement with no termination order in place

(b) Site 39 had a limited tenure to 20 September 2016 or the issue of s Stage 2 certificate, whichever comes first

(c) The residents had access to facilities and amenities in the applicant's retirement complex at the front of the park

(d) The park was in a good condition

(e) The security gate had been reinstalled

(f) All derelict dwellings had been removed and the park landscaped.

52 Mr Rutledge carried out a site inspection and visited comparable parks.

53 He gave each of the dwellings a value by a "direct comparison approach". Under this method, the sale of manufactured homes and caravans with rigid annexes in "comparable" parks was analysed and compared with the residents' sites. A further amount was allowed for dwellings with creek frontages. He valued each site as follows:

(g) Site 39 - $58,000

(h) Site 51 - $200,000

(i) Site 54 - $130,000

(j) Site 58 - $160,000

(k) Site 59 - $180,000

(l) Site 60 - $200,000.

54 In cross-examination he admitted the park owned the land on which the dwellings were based, not the resident. He said his basic assumption was that his valuations were based on a capacity to occupy a site and the total figure incoporated a right to occupy with the value of the building placed on a site if it were relocated.

55 The applicant provided written submissions at the end of the hearing.

SUBMISSIONS ON LAW AND EVIDENCE

56 Both counsel made oral submissions during their opening and on closing their cases.

57 Dr Berveling also provided written submissions before his closing statement and a set of further written submissions under a direction made at the end of the formal hearings.

Submissions of the Applicant

58 Dr Berveling submitted that each of the residents had been given a Notice of Termination pursuant to section 102 of the Act. In the LEC decision of Justice Biscoe, the Court declared that the land of all residents other than Mr Tucker was to be used for a purpose other than a residential site by no later than 20 September 2016.

59 In respect of Site 39 of Mr Tucker, the LEC declared the land was to be used no later than the time of issue of an occupation certificate for Stage 2 of the development.

60 Dr Berveling submitted that under section 113(3A) of the Act the Tribunal must not order possession unless:

(a) it is satisfied compensation for the cost of relocating the dwelling to its new location has been determined under section 128

(b) or the park owner has agreed to buy the dwelling from the resident at a price no less than its value, as determined by the Tribunal under section 130A,

(c) or the park owner and the resident have reached an acceptable negotiated settlement, and that agreement is bona fide.

61 Relocation of the residents was not possible as provided for in s 127 which allows for relocation to another residential site either within the same park or another residential park. Residents could not be relocated as there were no sites available in other parks in the area. He submitted that none of the residents have provided any evidence to suggest their dwelling could, or would be relocated.

62 Dr Berveling submitted that under s 128, compensation was an automatic entitlement. As relocation was not possible, the Tribunal may make an order based on section 128(4) which states:

(4) In fixing the amount of compensation to which a resident is entitled otherwise than in connection with the relocation of a dwelling to a new residential site, the Tribunal must have regard to the following matters:

(a) the reasonable costs of removing the dwelling from the old residential site (including the costs of disconnecting any services),

(b) the reasonable costs of transporting the dwelling to its new location or disposing of the dwelling,

(c) the reasonable costs of transporting the possessions of the residents of the dwelling to their new place of residence (whether at the dwelling's new location or some other location),

(d) the reasonable costs of repairing any damage to the dwelling arising from its relocation,

(e) the value of any financial or other assistance that the park owner has given to the resident in connection with the relocation.

63 Dr Berveling indicated that under s 128(4) the appraisals of Mr Price included the cost of transporting homes if they had been transportable. I would not put the evidence as high as that. The report states for each dwelling that the estimated selling price has been calculated on "the basis of it being relocated by using the price to procure a comparable home direct form the factory and then adjusting it for the age of the home and its current condition".

64 He further submitted that s 128 should not be interpreted in a way that supports the residents' claim that they should be awarded compensation at a level to buy a "comparable home". Further, the site inspection of comparable parks displayed residences and prices of such varying quality and price that making any finding as to what is a comparable home was not possible.

65 Dr Berveling said the residents provided no persuasive evidence of the factors to be considered under s 128(4). As a result, he asked the Tribunal to draw a conclusion that the park owner had agreed to buy the dwelling from the residents at a price no less than their respective value. Pursuant to s113(3A)(3), that which is to be valued is the value of the dwelling as determined by the Tribunal under s130A. Section 130A provides:

130A Tribunal may value dwellings to facilitate sale

(1) The object of this section is to enable the Tribunal to assist a park owner and a resident to come to an agreement as to the value of the resident's dwelling where there is a proposed sale of the dwelling from the resident to the park owner.

(2) The Tribunal may, by order, determine the value of the resident's dwelling and, for that purpose, may obtain a valuation of the dwelling, or seek advice as to the valuation of the dwelling, from one or more registered valuers.

(3) An application for such an order may be made by the resident or by the park owner, or by both.

(4) The Tribunal's determination may not have regard to the dwelling's location.

(5) The Tribunal's determination of the value of the resident's dwelling is advisory only, and does not bind the resident or the park owner or affect any agreement between them for the sale of the dwelling.

(6) Any costs payable to a registered valuer for any valuation or advice provided to the Tribunal for the purposes of proceedings under this section are payable by the Tribunal, except to the extent to which the regulations provide that the parties to the proceedings are to pay such costs.

(7) The regulations may provide that the parties are to pay such costs:

(a) in such proportions as are agreed between them or, failing agreement, as are ordered by the Tribunal, or

(b) in any other manner prescribed by the regulations.

(8) In this section:

dwelling means a relocatable home or a registrable moveable dwelling with a rigid annexe attached to it.

registered valuer has the same meaning as it has in the Valuers Act 2003.

66 He submitted that the value of the dwelling is confined by the definition of a dwelling in the Act which is a moveable, manufactured home which the resident has on the residential site which is part of the land owned by the park owner. As a result, "the park owner is not required to pay value for regaining possession of the residential site already owned by it". He also indicated that under s 130A(4) any valuation is not to have regard to the dwelling's location.

67 He submitted I should not accept the residents' valuations of Mr Rutledge because they were based on an incorrect assumption and valued compensation for a home on a site rather than merely the dwelling itself. Dr Berveling concluded:

Mr Rutledge uses incorrect comparables because the present case is not dealing with a moveable dwelling of a certain quality on a site with particular qualities in a park with particular qualities.

68 Dr Berveling said the Tribunal should prefer the valuations of Mr Price over those of Mr Brown as the former is more experienced in the valuation of mobile homes. Given that Mr Brown's valuations ranged between $0 and $15,000 that concession is of great assistance to the residents and the Tribunal.

The Respondents' Submissions

69 Ms McMahon argued that under s 128(1) and 128(2) I had complete discretion in relation to compensation to be ordered as there was no alternate accommodation or available sites. Those sections state:

(1) The amount of compensation that a resident is entitled to be paid by a park owner under this Division is to be fixed by agreement between the resident and the park owner or by an order of the Tribunal.

(2) An application for such an order may be made, by the park owner or by the resident:

(a) in any proceedings on an application under section 113, being an application made on a ground referred to in section 101, 102 or 104, or

(b) in any proceedings on an application referred to in section 118 in respect of a residential site agreement, or

(c) in any proceedings commenced within 6 months after the resident vacates a residential site in compliance with a notice or order referred to in section 101, 102, 104, 118 or 127.

70 She said my discretion was not fettered by s 128(3) and s 128(4) as these ought to only be applied where an application is made by the resident.

71 Crucially, Ms McMahon argued that absent any site for the residents to go to at another park, the compensation ought to be at a level that allows them to purchase a site at another park.

72 She said the Tribunal had no power to order sale of the dwelling to the Park owner under s 130A as this section ought to be construed, at its highest, as advisory only and does not bind the parties.

73 Ms McMahon submitted the residents relied on the assurances from the park owner prior to Tricare purchasing the park that residents on the creek front were to remain at the park indefinitely. The termination notices outraged the residents. The occupation date for Stage 2 has not been issued so no date has been set for when Mr Tucker is to vacate.

74 She said the Tribunal cannot make a termination order under s102 without making a compensation order under s 128. In this case, as relocation cannot occur and there is no agreement from the residents for the park owner to buy their dwellings under s 130A, the Tribunal could not make a termination order.

75 If the Tribunal were minded to terminate and make an order for compensation, Ms McMahon submitted the Act is silent in the compensation to be ordered under s 113 other than to relocation.

76 She said s 33 of Interpretation Act NSW requires me to consider the purpose of the Act and to promote the objects of the Act when addressing interpretation of the provisions of the Act. The RPA objects are:

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.

77 As an object at 4A of the RPA is to establish protection for residents, I should find that the residents have a right to retain their sites indefinitely. In the alternative, any compensation must bear in mind the objects of the Act and not value dwellings as if sold from the back of a truck. Ms McMahon submitted that it would be extraordinary if s 128(4) were to apply in this case so as to diminish the residents' rights to compensation. If the submissions of the applicant were accepted, it would mean a park owner could run a park into the ground to devalue it and then rely on that deterioration to pay reduced compensation for termination based on change of use. That cannot possibly be the purpose of the Act, Ms McMahon insisted. She said the Tribunal has discretion to value the compensation on the basis as set forward by Mr Rutledge that the true value equals the value of the dwelling and the right to occupy under the site agreement itself at a comparable park. Rutledge's report did not value the land.

78 Ms McMahon submitted the new legislation regarding parks, the Residential (Land Lease) Communities Act 2013 ("the new Act"), sought to rectify the legislative framing of the RPA in a situation where relocation is not possible. Included in the factors to be taken into account for compensation under the new Act at s 141(3)(a) was loss of residency. That section states:

141 Compensation where home not relocated

(1) The operator of a community is liable to pay compensation to a home owner as provided for by this section if the operator gives a termination notice to the home owner and the home owner does not want to relocate to another community or is unable to relocate to another community.

(2) If the site agreement specifies any compensation amount or method for determining compensation in the circumstances to which this section applies, the compensation payable is to be determined as specified in the agreement.

(3) If the site agreement does not specify the manner for determining the compensation payable in the circumstances to which this section applies, the following compensation is payable (in advance of relocation):

(a) compensation for the loss of residency,

(b) compensation for relocation.

(4) The compensation payable for the loss of residency is such amount as is reasonable having regard to the following:

(a) the length of time remaining for the duration (if any) of the site agreement,

(b) the original purchase price paid by the home owner for the home and (if the home was purchased from the owner or operator of the community) any arrangements that were entered into in connection with the purchase,

(c) the current on-site market value of the home (determined as if the termination were not to occur),

(d) site fees payable for the residential site,

(e) any other relevant factor raised by the parties or prescribed by the regulations.

(5) The compensation payable for relocation is such amount as is reasonable determined having regard to the following:

(a) the cost of moving,

(b) inconvenience to the home owner,

(c) the length of time that the occupant or occupants of the home have lived on the residential site,

(d) any other relevant factor raised by the parties or prescribed by the regulations.

(6) If the home owner intends to keep the home:

(a) any amount the home owner is capable of recouping by selling the home off-site is to be deducted from the compensation payable for the loss of residency, and

(b) regard is to be had to the cost of removing and transporting the home in determining the cost of moving (and the compensation payable for relocation).

(7) If the home owner does not intend to keep the home, the home owner must, in return for the payment of compensation under this section, transfer the home (free of all encumbrances) to the operator of the community.

(8) The Tribunal may, on application by a home owner or operator, make an order resolving a dispute concerning the operation of this section in the circumstances of a particular case.

(9) This section does not apply:

(a) in the circumstances to which section 140 applies, or

(b) to arrangements made for the purposes of the sale of a home to the owner or operator of the community.

79 Ms McMahon was asked by me if there was any authority that supported her contention that as a matter of statutory construction I should take into account what new, but yet un-operative legislation intended. She was not able to supply such authority.

80 Ms McMahon cited one authority where the matter involved a staged development and the issue of valuation of dwellings. Dr Berveling submitted the case as it was about a deemed refusal of a development application. I found that the scope of the judgement was about whether a development ought to have been granted or not. That is not the issue in this proceeding. There was no finding in the case as to methods of valuation to be adopted.

81 Ms McMahon submitted that I should accept the valuations of Mr Rutledge over those of Mr Price because the former is a licensed valuer. Mr Rutledge was not cross-examined on the main body of his report about comparable values in the area. She said the report of Mr Brown for Herron Todd White should not be accepted as Mr Brown was evasive, based his report on the opinions of others and prepared a report contrary to his instructions. Further, he failed to concede obvious points. However, as the applicant has indicated it is not relying on this report I do not need to consider it further.

82 Ms McMahon submitted the evidence indicated there was a compensation pool of $1.5 million set side when Tricare purchased the park and only $498,000 had been expended. Consequently, over $1,000,000 must remain in that pool. The park owner had carried out due diligence and received the benefit of a discount in the purchase price for the purpose of compensation. The values of Mr Rutledge were not beyond the original expectations of the park owner and the owner would profit by $700,000 if the values of Mr Price were accepted.

83 The residents submitted an order for possession cannot be made under s 113 (3A) and sought a declaration that s 130A was advisory only. For the first time in her closing, Ms McMahon submitted the whole matter might be held over until the new Act became operative and the proceedings might be re-agitated under the provisions of the new Act. Ms McMahon submitted that there was a total disconnect between s 113 and s 128 as the residents cannot be compensated for the cost of relocation.

Reply Submissions of Dr Berveling

84 In his additional written reply submissions Dr Berveling said that s130A may be advisory only but under s 113(3A)(b) the Tribunal need only be satisfied that the park owner agreed to buy the dwelling from the resident at a price no less than its value. The legislation did not dictate any requirement for an agreement for the resident to sell. However, I note that s 113(3A)(b) goes on to say that the purchase price must be "as determined by the Tribunal under section 130A". In other words, the Tribunal must have made an order under s 130A first before 113(3A)(b) is activated.

85 In relation to the compensation pool submission of Ms McMahon of $1.5 million, Dr Berveling said that pool included a figure to buy out the property of a director of the former owner. Moreover, he said that the table of total amounts paid to other residents who had settled and left the park (Exhibit A6) included legal costs. When these were taken into account, over $733,000 had already been paid from the compensation pool.

86 Dr Berveling said that to hold over the matter for the new legislation to become active is contrary to s 56(1) of the Civil Procedure Act 2005 where the overriding purpose of civil proceedings is to facilitate the just, quick and cheap resolution of the real issues in the proceedings. Further, such hold over would be contrary to the object of the Consumer, Trader and Tenancy Tribunal Act 2001 at s 3(c) which is for the Tribunal to enable proceedings to be determined in an informal, expeditious and inexpensive manner.

87 Dr Berveling correctly pointed out that the residents did not provide to the Tribunal a precedent supporting Ms McMahon's assertion that one might look to the new Act as an aid in interpreting the RPA. He submitted that I should not give consideration to the new Act as an aid for interpretation because it had not yet commenced. Clause 6 of Schedule 2 of the new Act provides that this proceeding which was brought before the Tribunal before the commencement of the new Act is to be determined in accordance with the repealed Act, being the RPA.

88 Dr Berveling also submitted that Part 3 of the Interpretation Act 1987 deals with how to interpret new acts and "sets out limited mechanisms for exercising certain powers between the enactment and the commencement of an Act, and the making and commencement of instruments".

89 In particular, s 26 provides:

26 Exercise of certain powers between enactment and commencement of Acts and making and commencement of instruments

(1) If an Act (in this section referred to as the Act concerned) that does not commence on its enactment would, had it commenced:

(a) confer a power, or

(b) amend some other Act in such a manner that the other Act, as amended, would confer a power, that must or may be exercised by the making of an instrument of a legislative or administrative character, then:

(c) such an instrument may be made, and

(d) any thing may be done for the purpose of enabling such an instrument to be made or of bringing such an instrument into effect, before the Act concerned commences, as if the Act concerned had commenced.

(2) A provision of an instrument made by virtue of subsection (1) shall take effect:

(a) on the day on which the Act concerned commences, or

(b) on the day on which the provision would have taken effect had the Act concerned commenced when the instrument was made, whichever is the later.

(3) If:

(a) this section applies to an Act that would, had it commenced, amend some other Act as referred to in subsection (1) (b), and

(b) the other Act has not commenced,

this section has effect as if the references in subsections (1) and (2) to the commencement of the Act concerned were references to the commencement of the other Act, as amended by the Act concerned.

(4) This section applies to an instrument that does not commence on its making in the same way as it applies to an Act that does not commence on its enactment. For that purpose, a reference in this section to an amendment of some other Act includes a reference to an amendment of some other instrument.

90 It was submitted that no instrument had been made under s 26 of the new Act that would confer on me a power to take into consideration anything in the new Act that would enable me to more appropriately interpret s 128 of the RPA in a situation were relocation was not possible.

91 Dr Berveling also provided in his submissions compelling authority as to why a new Act should not be used as an aid in interpretation of its predecessor.

92 Paragraphs [11]-[15] of his additional written submissions are worth stating in full:

In Sydney City Council v Ke-Su Investments Pty Limited, the Court of Appeal had to consider an application for adjournment of the hearing of an appeal to that Court. The subject matter of the appeal was premises being used for a brothel within an area zoned for residential use. In support for the application for adjournment, reference was made to two possible changes that might occur. The first was a further change in the law concerning prostitution; a Parliamentary committee was conducting an enquiry into prostitution and the possibility of legislation which would clarify the rights of the respondents in that appeal to conduct a brothel might be expected as a consequence of that enquiry and investigation. Further, representations were being made to the then Minister for Planning & Environment to secure changes to the Environmental Planning and Assessment Act with a view to clarifying the meaning of "lawful" under s106(a) of that Act.

At page 251, Kirby P (as he then was) held:

"It has been made clear in a number of reported cases that Courts will not normally stay proceedings (including, by inference, appeals) for the purpose of awaiting the passage of legislation which might affect the respective rights and obligations of the parties at law."

At 248, McHugh JA held:

"Thirdly, as a general rule, it is not a proper exercise of the discretion to grant an adjournment on the ground that it is believed that the law may or will be changed in the near or remote future. As Deane J pointed out in R v Whiteway; ex parte Stephenson [1961] VR 168 at 171:

'... I think it was the duty of the Court, when the applications came on for hearing, to deal with them in accordance with the law as it then stood ... It would be a cause of injustice if Courts could adjourn cases because they had some real or imagined belief that the law might be amended.'

In that case the adjournment was opposed that the principle is of general application.

Fourthly, and in my opinion, most importantly, the report of the Prostitution Committee and any consequential legislation is irrelevant to the determination of this appeal and the future relationship of the parties."

In Meggitt Overseas Limited v Grdovic, Mason P of the NSW Court of Appeal (with whom Sheller JA and Beazley JA agreed) rejected an argument that a different approach should be adopted where the proposed change of legislation is beneficial to an applicant.

Further, it is submitted that to take the New Act now into account in construing the scope of compensation pursuant to s128 of the Current Act is an irrelevant consideration. It is very rare for legislation to specifically allow for the drafts of certain documents to be taken into consideration. Two limited examples are s261 of the National Gas (NSW) law in its definition of "review related matter" able to be taken into consideration and s79C of the Environmental Planning and Assessment Act 1979 (in the matters to be taken into consideration in determining a development application, which include: "Any proposed instrument that is or has been the subject of public consultation under this Act and has been notified to the consent authority ...").

Given the above, it is submitted that regard cannot be had to the New Act in determining the scope of how compensation may become payable pursuant to s. 128 of the current Act for the following reasons:

It would be an irrelevant consideration to be taken into account;

The New Act specifically provides for the process in determining proceedings before the Tribunal that were commenced before the commencement of the New Act but which have not been determined before that commencement;

The powers to act beyond the provisions of existing legislation is extremely limited; and

Until commenced, there is no New Act.

THE RELEVANT LAW

93 For the purposes of this determination it is useful to point out a crucial difference between tenancy agreements and site agreements. Under a residential tenancy agreement related to a park, a resident normally rents the dwelling from the park whereas in a site agreement the residents own the dwelling on a site. Under a tenancy agreement, a tenant may be terminated without cause after the end of any fixed term when given a 90-day without cause termination notice under s 85 of the Residential Tenancies Act 2010. The only comfort for a tenant as to possible termination under a periodic agreement is a maximum of 90 days.

94 The RPA has no equivalent clause. Other than termination based on change of use as in this case, absent other grounds for termination common to both forms of agreement such as failure to pay rent / site fees or behavioural breaches, a resident under a site agreement continues to hold over periodically after the end of the fixed term and cannot be terminated without cause. This has led many park residents to believe that if they comply with the normal provisions such as paying site fees and not behaving reprehensibly, they can hold over indefinitely unless there is a change of use. It is that perception that goes to the heart of this proceeding and was summed up by the words of the resident who said the site was "never to be sold and to stay in the family".

95 What ought to be made clear is that a site agreement confers no real property rights and no proper basis for a resident to consider that they might stay on a site in perpetuity or that they have any indefeasibility of title.

96 The nature of a resident's right to the site is limited to a right to occupy land owned by the park granted by a contractual site agreement. That point of law was made plain in Haraba P/L v Castles [2007] QCA 206. In that case in which I was Junior Counsel led by Tony Morris QC, the Queensland Court of Appeal considered whether a site resident under Queensland's equivalent legislation, the Manufactured Homes (Residential Parks) Act 2003, was an "owner" under the site agreement and what rights residents had under the agreement until terminated. Section s 38(1)(f) allows for termination if "the park owner wishes to use the residential park land, or a part of the park in which the site is located, for another purpose stated in the application (the stated purpose)." There is little difference in terminating for a change of use or use of the land for another purpose. Commenting on rights conferred to a park resident under a site agreement at [20], Williams J said of the finding of the judgement below that was being appealed:

[20] At the very outset of his reasons for judgment the learned District Court judge made a serious error. He said that the respondent "purchased the right to occupy that site on 28 April 1995 for $42,000." As noted above, a home owner does not purchase a site. A site agreement merely confers a right to place a manufactured home on the site upon payment of the rental and otherwise complying with the terms of the site agreement. By a separate agreement the respondent purchased her manufactured home for $42,000 in April 1995, and on termination of the site agreement she remains the owner of that home. That error permeated the judge's reasons because subsequently he referred to the fact that termination of the site agreement as sought by the applicant would have the consequence of "excluding the respondent from recovering her investment after ten years." That was again repeated when he said that compensation pursuant to the Act would not "compensate her for the lost equity of some $13,000 accrued over the past 11 years". It needs to be repeated that pursuant to a site agreement under the Act a site is not "purchased". Nor, of course, is it appropriate to speak of an "equity" of a home owner in a site.

97 Compensation on change of purpose provisions were added to the RPA under the Residential Parks (Statutory Review) Bill 2005 ("the amending legislation"). The second reading speech for that bill states that parks are "unique housing arrangements in that [residents] live in their own homes on rented parcels of land".

98 I make these points about the RPA and the limitations on the rights of the residents being fully aware that the new Act runs contrary to the old in the sense that it refers to "home owners" sharing in capital gain. To give but one further example from the new Act in addition to the loss of residency submission already made by Ms McMahon about s 141 of the new Act, s 110 of the new Act provides:

Voluntary sharing arrangement

110 Voluntary sharing arrangement

(1) A site agreement entered into after the commencement of this section may provide for a voluntary sharing arrangement.

(2) A "voluntary sharing arrangement" is any provision under which the home owner agrees to one or more of the following:

(a) to pay a specified entry fee to the operator, on entry into the agreement or in any other manner specified in the agreement,

(b) to pay deferred site fees to the operator, being site fees the payment of which is deferred in a manner specified in the agreement,

(c) to pay a specified sale amount to the operator if the home is sold by the home owner, with that sale amount being either (but not both) of the following:

(i) a specified share of the capital gain in respect of the home,

(ii) a specified on-site premium of the total sale price of the home as determined in the agreement,

(d) to pay a specified exit fee to the operator, being a fixed fee (not of a kind referred to in paragraph (c)) that is payable if the home is sold or removed from the site.

(3) If a home is sold and the operator is the selling agent, the operator may deduct any amount payable under the voluntary sharing arrangement from the proceeds of the sale that are held by the operator in accordance with the agreement.

(4) If a home is sold and the operator is not the selling agent, the selling home owner must pay any amount owing to the operator under the voluntary sharing arrangement within 14 days of the sale being finalised.

(5) The Tribunal may, at any time, on application by an operator, make an order requiring a home owner to pay any amount owing to the operator under a voluntary sharing arrangement together with interest determined by the Tribunal.

(6) A sale amount is not payable if a home is sold to be removed from the residential site or is purchased by the operator or a close associate of the operator.

(7) In this section: "capital gain" means any increase between the amount that the home owner paid for the home and the amount that the purchaser paid for the home. Site fees and any fees or charges payable under the site agreement are not to be included in the calculation of the capital gain.

99 As Mr Price pointed out in his report, a chattel such as a manufactured home only deteriorates and depreciates over time. It cannot acquire capital gain. The legislators of the new Act mingle the situation in parks with home owners under real property titles to land. The legislators must have it in mind that the capital gain applies to a combination of the chattel and the contractual right to occupy the land under a site agreement.

100 But I accept the submissions of Dr Berveling. While the new Act significantly departs from the old and provides much more specific consideration for interpretation of section 128 in the RPA and makes even more complex the nature of the rights a resident has over a site, I am not convinced that I can have regard to the new Act as an interpretive aid when interpreting compensation to be made under s 128 of the RPA. The cases cited by Dr Berveling support that. The new Act does not make an provisions for, or create any instruments which allow me to interpret the RPA under the new provisions. To hold over the entire proceeding until the new Act becomes operative also would also make a mockery of the requirements for civil proceedings, and Tribunal proceedings in particular, to be "determined in an informal, expeditious and inexpensive manner".

101 Making findings under the new Act about capital gain relating to a chattel that only declines in value or in relation to compensation based on loss of residency will be issues for a Tribunal member to determine sometime in the future. I trust that difficult task falls to a member far wiser than me. The RPA is absent any such references and I must interpret what is the law in that legislation.

102 The amending legislation specifically had in mind a scenario as applies in this case. Further, I do not accept that the notion that a right to occupy on relocation is totally foreign to compensation that can be ordered under the RPA. Underneath its lack of precision, 128 is based on an assumption that relocation must occur either to a new residential site under s 128(3) or some other location under s 128(4). The resident has to relocate to somewhere under 128(4). A resident does not disappear into the ether. The second reading speech for the amending legislation states:

The third and final group of reforms contained in this bill relate to the termination mechanisms where the park owner wishes to redevelop his or her establishment and to the compensation payable to residents as a consequence. This is the area that has changed so much since the legislation came into effect in March 1999. As I commented earlier, the redevelopment environment has altered somewhat in the intervening years and some park owners are weighing up whether to remain in the business of providing permanent residents with home sites. It is clear that pressures have built up and the process for dealing with park owners seeking to regain vacant possession of their land for redevelopment purposes, and the subsequent payment of compensation to affected residents, needs to be improved.

I make no apologies for the fact that the refinements in the provisions relating to termination of tenancy and access to compensation will strengthen the position for park residents. This is only right and just, as they have the most to lose in a park redevelopment scenario. Not only do they face losing their home but also their community, and their longstanding neighbours and friends. They also have the challenge of making new housing arrangements, either by moving their dwelling to another park-if they can find a suitable and available site-or by trying to sell their home independently and then finding suitable alternative accommodation. The cost of moving moveable dwellings is substantial and the relocation logistics can be a tricky exercise. It can be an extremely traumatic and difficult time for people who may well have expected to see out their remaining days in the park. It is essential that if the park owner has legitimate reasons to seek closure of his or her park for redevelopment purposes residents are granted the most dignified and helpful process that is possible in such circumstances.

... The other major reforms to the termination provisions of the legislation in the redevelopment context relate to the payment of compensation to residents. Access to compensation is a justified right of residents who have not only lost their place of abode but have also had their lives uprooted.

103 Legislators drafted the amending legislation at a time when they were aware there were not ample other parks to move to. Relocation possibilities have been reduced by many park owners on the coastal areas of NSW changing long term sites into holiday occupation sites due to a belief they can make more money on such sites and have less onerous long term obligations to tourist occupants than they have to occupants under a residential site agreement.

104 Section 128(4) clearly allows for a compensation amount to be set where, as in this case, the resident cannot be relocated to a new residential park site. Considerations to be factored into any compensation amount include the costs of removing the dwelling from the old site, the costs of transporting it to a new location, the costs of disposal, the cost of transporting residents' possessions to a new location, the costs of repairs of the dwelling for damage incurred arising from its removal and any other assistance provided by the park owner.

105 Expressly, s 128 does not limit the compensation to be paid to less than or equal to the value of the dwelling. Compensation is only so limited at s 128(4)(d) if compensation is to be for reasonable costs of repairing any damage to the dwelling arising from its relocation. In other words, if compensation were made under s 128(4), it is quite possible that it may be more than the value of the dwelling if the other factors to be taken into account being removal, transporting, installing, landscaping or disposing of the dwelling, are added to repairs as provided for in 128(4). Consequently, the compensation order can be in excess of the base value the dwelling. If the legislators had intended that s 128 should limit any compensation to the value of a dwelling and no more, they would not have drafted the RPA to create such a limitation only in respect of the 128(4)(d) damage factor. They would have drafted the limitation to all of s 128(4) at least, or to s 128 as a whole.

106 Instead, in the second reading speech to the amending legislation, the statutory purpose was stated as:

Sometimes residents are faced with a difficult choice-that is, they have decided not to move their home to another park due to personal reasons or because they cannot find a suitable site, but they find that they cannot sell their home on site to anyone else because their park is facing closure. Also, there is a limited market in selling a park home to a buyer who is willing to remove it for use elsewhere. Often the resident's only option is to negotiate with the park owner to take the dwelling off their hands. This situation creates its own set of problems. The park owner is obviously in a powerful position and some residents have reported to the Office of Fair Trading that they have been forced into accepting a pittance for a home that is worth much more.

107 Underpinning s 128(4) is that on termination and giving of vacant possession residents must go somewhere and must have a right to occupy somewhere else. That right to occupy somewhere else and any compensation allowed for it is inherent in the s 128(4) factors that allow a compensation order in excess of the mere value of the dwelling.

108 The addition of the word "disposal" to the statutory language at s 128(4)(b) within a context were all other costs are treated as relocation considerations cannot mean that in a case where relocation is not possible the only compensation the resident should get is the disposal amount which most probably be far less than those amounts Mr Price valued for the residences. It is not the object of the Act for the residents rights to be treated so shabbily.

109 As Ms McMahon submitted, if compensation was limited to dwelling value that would allow a park owner to give a notice of termination under a change of use and run down the park facilities so that the value of the dwelling deteriorates over the time compensation is to be assessed.

110 I also do not accept the applicant's submission that the park owner has agreed to buy the dwelling from the resident at a price no less than its value a provided under s 113(3A)(b). There is no determination by the Tribunal under section 130A as required by s 113(3A)(b). I accept Ms Mahon's submission that s 130A of the RPA is voluntary and does not apply. The second reading speech of the amending legislation makes plain that the section cannot be binding:

The bill makes it clear that the value of the resident's home is to be calculated on its stand-alone value and will not include any component of the land which it stands upon. You could not have a more even-handed provision than this one. It provides for an independent referee when the parties cannot agree on a fair price. It ensures that residents are not taken advantage of. It makes it clear that park owners do not have to pay any proportion of the value of land that they already own. The tribunal's decision will not be binding on either party, but this mechanism will bring much greater transparency and parity to the process of selling a home [my emphasis]. It will also bring these issues to the attention of the tribunal when a park owner seeks to regain possession at the end of the process. The reforms to the provisions dealing with these two prime areas of concern-termination of tenancies for redevelopment and the payment of compensation-are crucial aspects of the bill.

111 The object of s 130A is for the Tribunal to enable the parties to come to an agreement as to value. If anything is certain in this matter, it is that the parties have been unable to come to an agreement as to the value the residents' dwellings. Section 130A does empower the Tribunal to seek an evaluation of the sites. Either party may apply to the Tribunal for a statement of the value. But such a statement by way of an order is advisory only and "does not bind the resident or the park owner or affect any agreement between them for the sale of the dwelling". Residents did not seek an agreement under s 130A. I did not seek the evaluations that were provided by way of expert evidence. I accept Ms McMahon's said the residents ought not be bound by any order as to evaluation under s 130A for an agreement they did not seek.

112 But I do not find that the law is that residents must be compensated to the full value of having a dwelling on a comparable park. The s 128(4) relocation factors fall short of saying that compensation is to include the full value of purchasing a comparable home at a comparable park. As indicated in the second reading speech to the amending legislation, the value of the resident's home does not include any component of the land which is the site. It falls short of that and stipulates the considerations in s 128(4) allowing an order to be made in excess of the value of the dwelling due to the need to relocate.

113 There is also nothing in the RPA that suggests a compensation order should be based on what Tricare might have allowed as a compensation fund when negotiating the purchase of the park with the vendor. I give no weight to that evidence and make no finding as to how much Tricare was allowed in its obligations for a compensation fund.

114 My critical problem in making an order under s 128(4) is that both parties would freely concede they have not given the Tribunal any evidence of the quantum to be allowed for the factors I must take into account.

115 This does not mean there was no evidence of what compensation order might be made beyond the value of the dwelling as opined by Mr Price. It was conceded by Mr O'Shea that some residents who settled, particularly those who did take their dwelling from the park, were offered compensation sums in excess of the appraisal of Mr Price. Reasons for that were not clearly stated, but it is more probable than not that considerations of the other s 128(4) factors that allow an order in excess of the value of the dwelling underpinned the settlement offers. It useful to examine those offers made in excess of the value of the dwelling to those residents who settled. Without identifying the particular site, I note the following payments in excess of appraisal:

Appraised value	Amount Paid
$1,500-$2,000	$15,000
$12,000-$15,000	$35,000
$5,000-$6,500	$18,000

116 These residents were offered a further consideration in excess of the value of the dwelling in a range from $12,500 to $20,000 to relocate.

117 Section 33 of the Interpretation Act 1987 allows me to have regard to the purposes or objects of Acts and statutory rules:

In the interpretation of a provision of an Act or statutory rule, a construction that would promote the purpose or object underlying the Act or statutory rule (whether or not that purpose or object is expressly stated in the Act or statutory rule or, in the case of a statutory rule, in the Act under which the rule was made) shall be preferred to a construction that would not promote that purpose or object.

118 Dr Berveling also cited as authority for principles of statutory interpretation on which I might rely. In Project Blue Sky v Australian Broadcasting Authority (1998) 194 CLR 355 at 381, the High Court stated:

The primary object of statutory construction is to construe the relevant provisions so that it is consistent with the language and purpose of all the provisions of the statute. The meaning of the provision must be determined "by reference to the language of the instrument viewed as a whole". In Commissioner for Railways (NSW) v Agalianos Dixon CJ pointed out that "the context, the general purpose and policy of a provision and its consistency and fairness are surer guides to its meaning than the logic with which it is constructed. Thus, the process of construction must always begin by examining the context of the provision that is being construed".

119 Given lack of precedent as to interpretation of s 128(4), and that the object of the RPA at s 4A(b) is to "establish legislative protection for residents", as opposed to the park owner, I am satisfied I can make a compensation order in excess of the value of the dwelling alone as a chattel. The second reading speech for the amending legislation also makes clear that the purpose of the compensation amendments was to ensure that "residents are properly and adequately afforded with consumer rights that are tailored to their unique living arrangements, as well as being protected against unfair and unjust treatment".

120 I accept the higher amount in the ranges of valuation for each of the residents' sites as opined by Mr Price. To this should be added an amount for s 128(4) factors beyond the value of the dwelling for relocation factors rather than a factor that incorporates the value of the land subject of the site. Considering the dearth of evidence in relation to s 128(4) factors but that there is some evidence that some residents have been paid in excess of the value of their dwelling, the amount that each of the residents ought to be paid in excess of the value of their dwelling as compensation for the factors set out in section 128(4) is $15,000 each. This amount would not be affected by the relative values of their dwellings as the other s 128 factors are more probably a fixed, or very similar sum for each resident.

121 Should the residents be dissatisfied with this determination for compensation under s 128(4), the RPA allows them a second bite of the cherry. Section 128 (2A) states:

(2A) An application for a further such order may be made by the resident on the ground that the compensation fixed by any earlier order or orders is inadequate, having regard to the matters referred to in subsection (3) or (4), as the case requires.

122 Having made an order as to compensation under s 128(4), the power of the Tribunal to terminate the site agreements under s113 for the ground of change of use as provided for in s 102 is enlivened.

123 Object 4A(c) of the RPA is "to establish procedures for resolving disputes between park owners and residents". If I was to accept Ms McMahon's contention that a termination order cannot be made and the application be either dismissed or held over so the residents might make a new application under the new Act, such a determination would run directly counter to that object.

124 The development of each of the residents site is a change of use of the land for a use other than as a residential site. Each of the residents have been given a valid notice of termination based on the ground that their residential site is to be used for a purpose other than that of a residential site. Termination orders are made accordingly.

G Bassett

General Member

Civil and Administrative Tribunal of New South Wales

2 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

Amendments

02 December 2014 - corrected paragraph numbering
Amended paragraphs: 1-124

Decision last updated: 02 December 2014