Pine Needles Village Pty Ltd v Residential Tribunal of NSW & Ors [2000] NSWSC 144

New South Wales Supreme Court

CITATION : Pine Needles Village Pty Ltd v Residential Tribunal of NSW & Ors [2000] NSWSC 144 CURRENT JURISDICTION: Common Law FILE NUMBER(S) : SC 30074/99 HEARING DATE(S) : Wednesday 8 March 2000 JUDGMENT DATE : 10 March 2000

PARTIES : Pine Needles Village Pty Limited v Residential Tribunal of NSW & Ors JUDGMENT OF : Michael Grove J at 1

LOWER COURT Residential Tribunal JURISDICTION : LOWER COURT 99/18293; 295; 299; 308; 309; 311; 312; 314; 316; 362 FILE NUMBER(S) : LOWER COURT K. Thane JUDICIAL OFFICER :

COUNSEL : T.M. Thawley (Plaintiff) J. Needham (2-11 Defendants) Carneys (Plaintiff) SOLICITORS : I.V. Knight (1D) Legal Aid Commission of NSW (2-11D) CATCHWORDS : Residential Parks - Agreement for Site Lease - Rent Increase - Prevailing Market Value - Compliance With Requirement to Set Out Method for Calculating Increase LEGISLATION CITED : Residential Parks Act 1998 DECISION : Summons Dismissed

THE SUPREME COURT OF NEW SOUTH WALES ADMINISTRATIVE LAW DIVISION

MICHAEL GROVE J

Friday 10 March 2000

30074/99 - PINE NEEDLES VILLAGE PTY LIMITED v RESIDENTIAL TRIBUNAL OF NEW SOUTH WALES & ORS

JUDGMENT 1 HIS HONOUR : This summons is in the nature of an appeal from a decision of the first defendant (the Tribunal) and the plaintiff is limited to challenge on questions of law. 2 Only a short background need be sketched. The second to eleventh defendants are respectively parties as tenants to agreements with the plaintiff for occupation of sites in a residential park village owned by the plaintiff. It is common ground that the Residential Parks Act 1998, proclaimed to take effect from 1 March 1999, applies by force of transitional provisions or otherwise to all subject agreements. References to sections are to that Act. 3 Each agreement was for a fixed term of two years and within their spans, notice was given by the plaintiff of a rent increase to take effect from 1 July 1999, that is there was to be an increase in rent during the fixed terms specified in the agreements. 4 In relation to such increase each agreement contained a term (clause 28) as follows: "The rent in this agreement and any subsequent agreement hereto, shall be reviewed annually on the first day of July. The revised rent will be not less than the current rent being paid prior to the review and may, at the Landlords discretion, be adjusted upwards to an amount commensurate to prevailing Market Value." 5 In a schedule following clause 51 of the agreement there appears (so far as is relevant): " Definitions 1. In this Agreement: …………….. 'Market Value' is determined by the assessment of rents being paid for comparable premises in the locality or similar locality." 6 Section 53(6) provides: "The rent payable by a resident under a residential tenancy agreement that creates a tenancy for a fixed term must not be increased during the currency of the fixed term unless the amount of the increase, or a method for calculating the amount of the increase, is set out in the agreement." 7 The tribunal found that clause 28 "does not set out a method of (sic) calculating the increases of rent during the fixed term and therefore does not comply with s 53(6) of the Residential Parks Act 1998" and ruled that there could be no increase in rent during the fixed term. 8 The issue in the present summons is whether that determination was wrong in law. 9 What is raised is a short point of construction. In deference to some argument presented, I should specify what I regard as not involved. No issue arises on the summons as to the intention of the parties, potential avoidance of terms for uncertainty or implication of term or terms. The discrete question is whether "commensurate to prevailing market value" ("market value" having the meaning stipulated) complies with the requirement to express in any agreement "a method for calculating" the amount of increase. 10 It is not to the point to observe the circumstance that it is common in commercial lease agreements to provide for rent adjustment by reference to market. Nor is it relevant to determination of the present question that market levels of rents are factors specified to be taken into account in determining rent applications: see s57. 11 "An amount commensurate with prevailing market value" is a statement of outcome in distinction from a method of calculation. Relevant dictionary references define "calculate" in terms of reckoning and computation, and "method" to procedure for attaining an object, which is to be distinguished from the object itself. I am unpersuaded that the tribunal erred in law in holding that cl 28 did not set out a method for calculating increases in rent as required by s53(6). The conclusion of the tribunal is consistent with expressed aims of certainty touched upon in parliamentary debate during the passage of the legislation but it is not necessary to turn to such sources in order to resolve any ambiguity or construe the statutory language. 12 The summons is dismissed with costs. **********