Allen v TriCare (Hastings) Ltd [2016] NSWCATAP 216
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Civil and Administrative Tribunal
New South Wales
Medium Neutral Citation: Allen v TriCare (Hastings) Ltd [2016] NSWCATAP 216
Hearing dates: 15 and 24 August, 8 September 2016
Date of orders: 19 September 2016
Decision date: 19 September 2016
Jurisdiction: Appeal Panel
Before: Wright J, President
R Seiden SC, Principal Member
R Titterton, Senior Member
Decision: In respect of each of appeals AP 16/25372, AP 16/25414, AP 16/24875, AP 16/22096, AP 16/25422:
1. The Appeal Panel orders that:
(1) The Appeal is dismissed.
(2) Orders 1, 2, 3, 4 and 5 made on 6 April 2016 are confirmed.
2. The Appeal Panel directs that if any party wishes to press an application for costs of this appeal:
(a) The party is to file and serve any submissions on costs and on whether the application should be dealt with on the papers without an oral hearing on or before 3 October 2016;
(b) Any party which opposes the ordering of such costs is to file and serve any submission on costs and on whether the application should be dealt with on the paper without an oral hearing on or before 17 October 2016; and
(c) The party pressing the application for costs is to file and serve any submissions in reply on or before 24 October 2016.
Catchwords: RESIDENTIAL PARKS – Residential Parks Act – whether object in s 130A(1) operates as a jurisdictional fact – object in s 130A(1) does not establish a jurisdictional fact or the fact was satisfied in this case
RESIDENTIAL PARKS – Residential Parks Act – whether the Tribunal may make a possession order under s 113(3A)(b) in circumstances where the resident does not agree to the sale of the dwelling – Tribunal may make an order for possession where resident does not agree
RESIDENTIAL PARKS – Residential Parks Act – whether valuation under s 130A includes rights attached to site agreement – valuation is limited to the dwelling only
RESIDENTIAL LAND LEASE COMMUNITIES – Residential (Land Lease) Communities Act 2013 – operation of transitional provisions
EVIDENCE – expert evidence – approach to expert evidence when not bound by rules of evidence – expert evidence must provide a satisfactory basis for Tribunal's findings – question of acceptability of expert evidence in Tribunal one of weight not admissibility
Legislation Cited: Civil and Administrative Tribunal Act 2013 (NSW), s 32, s 38, s 80
Consumer, Trader and Tenancy Tribunal Act 2001 (NSW), s 28
Interpretation Act 1987 (NSW), s 5(2), s 30(1), s 34
Residential (Land Lease) Communities Act 2013 (NSW), s 141, Sch 2 cll 6, 8, 10
Residential Parks Act 1998 (NSW), s 3, s 5, s 20, s 41, s 43, s 102, s 113, s 128A, 130A
Residential Parks Amendment (Statutory Review) Act 2005 (NSW)
Cases Cited: ADCO Constructions Pty Ltd v Goudappel [2014] HCA 18; 254 CLR 1
Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue [2009] HCA 41; 239 CLR 27
Allen v TriCare (Hastings) Pty Ltd [2015] NSWSC 416
Bignill v Director of Public Prosecutions [2016] NSWCA 13
Commissioner for Railways (NSW) v Agalianos [1955] HCA 27; 92 CLR 390
Commissioner of Taxation v Consolidated Media Holdings Ltd [2012] HCA 55; 250 CLR 503
Dionisatos v Acrow Formwork & Scaffolding Pty Ltd [2015] NSWCA 281
Duncan v Independent Commission Against Corruption [2016] NSWCA 143
Haig v The Minister Administering the National Parks and Wildlife Act 1974 (Court of Appeal (NSW), 4 November 1994 unrep)
Hancock v East Coast Timber Products Pty Limited [2011] NSWCA 11
Khoury v Government Insurance Office of (NSW) [1984] HCA 55; 165 CLR 622
Kostas v HIA Insurance Services Pty Ltd (2010) 241 CLR 390; [2010] HCA 32
Mamo v Surace (2014) 86 NSWLR 275; [2014] NSWCA 583
Paino v Paino [2008] NSWCA 276; (2008) 40 Fam LR 96
Pointe Gourde Quarrying and Transport Co v Sub-Intendent of Crown Lands Trinidad [1947] AC 565
Project Blue Sky v Australian Broadcasting Authority [1998] HCA 28; 194 CLR 355
SL v Secretary, Department of Family and Community Services [2016] NSWCA 124
Springfield Land Corporation (No 2) Pty Ltd v Queensland (2011) 242 CLR 632; [2011] HCA 15
Spencer v The Commonwealth (1907) 5 CLR 418
Sydney Harbour Foreshore Authority v Walker Corporation Pty Ltd (2005) 63 NSWLR 407; [2005] NSWCA 251
Sydney Water Corporation v Marrickville Council [2014] NSWCA 438
Thiess v Collector of Customs [2014] HCA 12; 250 CLR 664
TriCare (Hastings) Limited v Allen [2015] NSWCA 344
TriCare (Hastings) Limited v Tweed Shire Council (No 2) [2013] NSWLEC 207
TriCare (Hastings) Limited v Tweed Shire Council [2013] NSWLEC 183
Water Board v Moustakas (1988) 180 CLR 491
Category: Principal judgment
Parties: Sue Allen (Appellant in AP16/22096)
Beryl Anderson (Appellant in AP16/25422)
Kevin Byng (First Appellant in AP16/24875)
Lorraine Byng (Second Appellant in AP16/24875)
Phillip Tucker (Appellant in AP16/25372)
Judy Tucker (Appellant in AP16/25414)
TriCare (Hastings) Limited (Respondent in all appeals)
Representation: Counsel:
Ms M McMahon (Appellants)
Dr S Berveling (Respondent)
Solicitors:
Tenants' Union New South Wales (Appellants)
Minter Ellison (Respondent)
File Number(s): AP 16/25372, AP 16/25414, AP 16/24875, AP 16/22096, AP 16/25422
Decision under appeal Court or tribunal: Civil and Administrative Tribunal of New South Wales
Jurisdiction: Consumer and Commercial Division
Citation: [2016] NSWCATCD 25
Date of Decision: 06 April 2016
Before: S Westgarth, Deputy President
File Number(s): RP 13/34743, RP 13/34744, RP 13/34745, RP 13/34746 and RP 13/34741
REASONS FOR DECISION
Introduction
1. There are before the Appeal Panel five appeals. The appellants are residents of a residential park at Hastings Point in northern New South Wales known as the Hastings Point Holiday Park, formerly the Hastings Point Caravan Park. The respondent to each appeal is the owner of the park.
2. Each appeal is against orders made in the Consumer and Commercial Division of the Tribunal on 6 April 2016:
1. terminating residential tenancy agreement of each resident;
2. requiring the resident or residents to deliver up vacant possession on or before 20 September 2016; but
3. suspending the possession order until the owner had paid or tendered to the resident or residents the sum determined by the Tribunal as the value of the dwelling in question.
1. For the reasons which follow, we have determined that the appeals should each be dismissed and the orders of 6 April 2016 confirmed. We have also decided not to remit the proceedings, as sought by the residents in the alternative. Notwithstanding this, we note that the residents may be entitled to compensation under s 141 of the Residential (Land Lease) Communities Act 2013 (NSW) having regard to the operation of cll 10 and 8 of Sch 2 to that Act and that the residents or the owners may apply under s 141(8) to have the Tribunal resolve any dispute as to the application of that section in the circumstances of these particular cases, as explained in [389] to [400] below.
Background
1. These proceedings and related proceedings have had a somewhat convoluted history in:
1. the Tribunal's predecessor, the Consumer, Trader and Tenancy Tribunal (CTTT), and the Tribunal – see TriCare (Hastings ) Pty Ltd v Allen [2014] NSWCATCD 162, Judy Tucker v TriCare (Hastings) Pty Ltd [2014] NSWCATCD 166 and TriCare v Allen [2016] NSWCATCD 25;
2. the Land and Environment Court – see TriCare (Hastings) Limited v Tweed Shire Council [2013] NSWLEC 183 and TriCare (Hastings) Limited v Tweed Shire Council (No 2) [2013] NSWLEC 207;
3. the Supreme Court – see Allen v TriCare (Hastings) Pty Ltd [2015] NSWSC 416; and
4. the Court of Appeal – see TriCare (Hastings) Limited v Allen [2015] NSWCA 344.
(It appears that the references to the park owner as "TriCare (Hastings) Pty Ltd" may be a typographical error and the relevant company should in all cases be TriCare (Hastings) Limited.)
1. It is sufficient to note by way of background what is set out in the following paragraphs.
2. On 24 June 2013 the owner filed in the CTTT applications for termination of the residential tenancy agreements with the residents in respect of the sites in the Hastings Point Holiday Park, as set out in the table below.
Application Resident/s Site Number
RP13/34743 Phillip Tucker 39
RP13/34744 Judy Tucker 51
RP13/34745 Kevin and Lorraine Byng 54
RP13/34746 Sue Allen 58
RP13/34741 Beryl Anderson 59
1. The applications for termination of the residential tenancy agreements were made under s 113 of the Residential Parks Act 1998 (NSW) (the Residential Parks Act) on the ground referred to in s 102 of that Act, namely that the residential sites were to be used for a purpose other than a residential site.
2. The CTTT was abolished on 1 January 2014 when NCAT was created. Under the transitional provisions found in cll 6 and 7 of Sch 1 to the Civil and Administrative Tribunal Act 2013 (NSW) (NCAT Act), these proceedings were unheard proceedings and could be heard and determined in this Tribunal. For these purposes, cl 7(3) provides:
"(a) NCAT has and may exercise all the functions that the relevant existing tribunal had immediately before its abolition, and
(b) the provisions of any Act, statutory rule or other law that would have applied to or in respect of the proceedings had this Act and the relevant amending Acts not been enacted continue to apply."
1. It follows from this that the Consumer, Trader and Tenancy Tribunal Act 2001 (NSW) (CTTT Act) continued to apply to the proceedings at first instance.
2. After a number of adjournments sought by one or other of the parties for various reasons, the applications were heard over two days, 10 March 2014, with an inspection of the park on the following day, and 27 May 2014. Written submissions closed on 3 June 2014 and the Tribunal handed down its decision on 2 September 2014, which included termination and possession orders, under s 113 of the Residential Parks Act and the awarding of compensation under s 128 of that Act - TriCare (Hastings) Pty Ltd v Allen [2014] NSWCATCD 162.
3. The orders made by the Tribunal on that occasion were, however, set aside by Beech-Jones J on 17 April 2015 on the basis that the Tribunal's decision was affected by jurisdictional error. The errors included that the Tribunal purported to rely upon s 113(3A)(a) of the Residential Parks Act but this was not possible when the residents' dwellings were not being relocated, the Tribunal had not determined compensation under s 128 that answered the description in s 113(3A)(a) and, in purporting to determine such compensation, the Tribunal took into account irrelevant matters.
4. The proceedings were remitted to the Consumer and Commercial Division of the Tribunal for rehearing. On 10 November 2015, an appeal to the Court of Appeal from aspects of Beech-Jones J's reasoning was dismissed as incompetent - TriCare (Hastings) Limited v Allen [2015] NSWCA 344.
5. In December 2015 and in January and February 2016, the Tribunal made directions for the preparation of the applications for rehearing. In doing so, the Tribunal put in commendable effort to ensure that the hearings were confined to the real matters in issue, in accordance with how the parties put their respective cases at that time. The directions were eventually issued on 13 January 2016.
6. Subsequently, the residents indicated that they might not file any expert valuation evidence and certain extensions of time were needed. Consequently the directions were amended on 17 February 2016. The most relevant portions of the directions were contained in orders 3 to 8 and remained unchanged. The directions in their final form contained the following:
"…
3. The parties have agreed that the following questions (Issues for Determination) are the only questions that arise for determination by the Tribunal:
a. Whether, on the proper construction of s 113(3A) and 130A of the RP Act the Tribunal is precluded from making an order for possession in favour of the park owner in circumstances where:
i. there is presently no proposed sale of the dwelling: and
ii. s113(3A) (a) and (c) do not apply.
b. On its proper construction, does a valuation under section 130A of the Residential Parks Act,1998 (RP Act) include those factors set out in paragraph 35 of the reasons for decision in the Supreme Court of New South Wales given 17 April 2015 in Allen & Ors v Tricare (Hastings) Pty and Anr [2015] NSWSC 416 (Supreme Court Decision).
c. If yes, what is the value of the dwelling of each of the respondents.
d. If no, what is the value of the dwelling of each of the respondent.
4. For the purpose of determining the question in 3b above, the parties agree that the factors set out in paragraph 35 of the Supreme Court Decision are:
1. a right to quiet enjoyment;
2. protection of defeasibility having regard to rights granted to a tenant under the RP Act;
3. a right of the tenant to sublet and assign;
4. rights of succession following the death of a tenant.
5. Subject to determination of the Issues for Determination by the Tribunal as provided by these directions and the value to be assigned to the dwelling of each of the respondents, the Tribunal notes the agreement of the parties as follows:
a. The Tribunal, by consent, is to makes the following orders:
i. each of the residential tenancy agreements is to be terminated on 20 September 2016;
ii. possession of each site is to be delivered up on 20 September 2016;
b. In the event an order for possession is made, the applicant will pay to each of the respondents an amount equal to the value of the dwelling as determined by the resolution of the Issues for Determination.
For the purpose of determining the Issues for Determination the Tribunal makes the following directions:
6. Within 7 days from the date of these orders each party is to appoint a valuer (Experts) to provide, in accordance with order 6, a joint report to value each of the respondents respective dwellings as at 29 January 2016 on the following bases:
a. that the dwelling is to be valued in accordance with the provisions of section 130A of the RP Act on the assumption that the factors set out in paragraph 4 above do apply; and
b. that the dwelling is to be valued in accordance with the provisions of section 130A of the RP Act on the assumption that the factors set out in paragraph 4 above do not apply.
7. For the purpose of the valuations:
a) The value to be assessed under order 6 (a) and (b) having regard to section 130A (4) of the RP Act is to be determined on the following alternative bases:
i. No regard is had at all to the dwelling's location;
ii. no regard is had to any premium attached to the particular dwelling's location but having regard to it being located in the particular park; and
iii. it being located in a comparable park.
b) In respect of the valuations under 7(a), (i), (ii) and (iii) the values are to be assessed on the basis:
i. Of the current state of repair of the particular dwelling; and, in the alternative,
ii. That the particular dwelling is in reasonable repair.
c) In respect of the valuations under 7(a) (ii), the values to be assessed are to:
i. disregard the fact there is presently building works being carried out at the park; and
ii. assume that the park is in reasonable condition with access to reasonable amenities.
8. The Tribunal notes that neither party asserts any basis for valuation other than provided for in these orders.
9. On or before 19 February 2016 the experts are to prepare and file a joint report, prepared on the various bases set out in order 7 which must include the following:
a. a statement of the agreed value of the dwelling for each respondent;
b. for each dwelling for which a value is not agreed:
i. a statement from each Expert as to the assessed value;
ii. A succinct statement as to the reasons why the Expert asserts the value assessed by them is correct and why the value assessed by the other expert is incorrect; and
iii. each expert opinion in respect of the assessed value.
c. A separate folder containing any relevant evidence relied upon for the purpose of the valuations and expert opinions.
9A Failing compliance with amended order 9 either party is at liberty to file and serve on or before 19 February 2016 any experts report which is to include a statement of the agreed value of the dwelling for each respondent, and to provide a separate folder containing any relevant evidence relied upon for the purposes of valuations and expert opinions
10. The opinions to be provided by the experts and the joint report must comply with Procedural Direction 3 - Expert Witnesses.
…"
1. It will be noted from order 3 that the amount of compensation payable to the residents under s 102(5) of the Residential Tenancies Act, fixed in accordance with s 128, was not one of the issues that the parties required the Tribunal to determine.
2. In addition, notwithstanding the terms of order 5(a), the question whether the residents did in fact consent to such a notation or reach such an agreement was in dispute on this appeal. We shall refer to this later in these reasons.
3. All the applications came on for rehearing before Deputy President Westgarth on 29 February 2016. They were heard together. It was accepted by the parties, and the Tribunal at first instance proceeded on the basis, that:
1. The applicable law in respect of each application was the Residential Parks Act, by operation of cl 6 of Sch 2 to the Residential (Land Lease) Communities Act 2013 (NSW) (the Land Lease Communities Act).
2. The owner had been granted development consent to develop the land, including the land on which the relevant sites were located, as an aged care or seniors' living development with various levels of care available.
3. The agreements in respect of which the owner sought termination and possession orders were "residential site agreements", being a type of "residential tenancy agreement", as both of those terms are defined in s 3 of the Residential Parks Act.
4. The required notice of termination in each case had been validly given under s 102(1) of the Residential Parks Act, on the ground that the residential site in question was to be used for a purpose other than a residential site.
5. In relation to the making of possession orders as required by s 113(4) of the Residential Parks Act and complying with s 113(3A):
1. s 113(3A)(a) was not applicable since the dwellings were not to be relocated and thus, as Beech-Jones J held, the determination of compensation under s 128 would not provide a foundation for making possession orders;
2. s 113(3A)(c) was not applicable as no agreement had been reached between the parties;
3. s 113(3A)(b) was the only relevant paragraph.
The Decision Below
1. The Tribunal at first instance concluded (principally at [110] – [112] and [129] of its reasons) in effect as follows:
1. the requirements for making orders under s 113 of the Residential Parks Act terminating the residential tenancy agreements, based upon a notice of termination issued by the owner under s 102 (change of use) had been satisfied and the Tribunal was required to make termination orders;
2. since the Tribunal was to make termination orders, it was also required under s 113(4) to make possession orders but it could only make possession orders, in cases such as the present, if it was satisfied that one or other of the conditions set out in s 113(3A)(a), (b) or (c) was satisfied;
3. in the present cases, since it was agreed that the only relevant condition was the one arising under s 113(3A)(b), before possession orders could be made the Tribunal had to be satisfied that the owner had agreed to buy the dwellings from the residents at prices no less than their values, as determined by the Tribunal under s 130A;
4. the Tribunal was satisfied that the owner had agreed to buy the dwellings from the residents at prices no less than the values determined in these proceedings by the Tribunal under s 130A, because:
1. a unilateral offer by the owner to buy a resident's dwelling amounted to the "owner … [agreeing] to buy the dwelling from the resident" for the purposes of s 113(3A)(b), at a price no less than its value as determined by the Tribunal under s 130A;
2. the values determined under s 130A were to be determined with the dwellings in the their current state of repair, without regard to the dwellings' locations and not taking into account the factors set out in the [35] of the judgment of Beech-Jones J, referred to above;
3. The opinions of Mr Hoolihan, a registered valuer, as to the valuations (on Basis 1, without [35] factors and with the dwellings in their current condition) should be determined to be the values of the dwellings under s 130A;
4. the owner had unilaterally offered or agreed to buy the dwellings at prices that were equal to, and thus not less than, the values as determined by the Tribunal under s 130A;
5. on this basis, the Tribunal was satisfied the condition in s 113(3A)(b) was met.
1. Consequently, on 6 April 2016 the Tribunal made orders as follows:
"(1) The residential tenancy agreements of each of the respondents is hereby terminated;
(2) The respondents will deliver up vacant possession of their respective residential sites on or before 20 September 2016;
(3) Notwithstanding order 2, the orders for possession are suspended until the respondents receive payment in full, of the amounts determined in these reasons to be the values of the dwellings (or until payment in full is tendered) namely:
Site 39 $60,000
Site 51 $85,000
Site 54 $20,000
Site 58 $45,000
Site 59 $40,000
(4) Once payment in full is made or tendered by the applicant to the respondents then in respect of those respondents who have received payment in full or been tendered payment in full the suspension of the order for possession is lifted; and
(5) Liberty to renew."
The Appeal
1. On 27 April 2016, the residents lodged notices of appeal against the decisions made on 6 April 2016 in respect of each of the matters. Rule 25(4)(b) of the Civil and Administrative Tribunal Rules 2014 (the Rules) requires an appeal of this nature to be lodged within 14 days from the day on which the appellant was notified of the decision to be appealed or given reasons for the decision (whichever is the later).
2. On 16 June 2016, the Appeal Panel extended the time for filing the appeal to 27 April 2016, by consent, and thus the appeals are within time.
Grounds of Appeal and Orders Sought on Appeal
1. Each of the residents appealed against orders (1) to (4) of the Tribunal's orders made in their respective matters.
2. The original notices of appeal listed six grounds of appeal. By leave granted by the Appeal Panel on 24 August 2016, the residents were permitted to amend their grounds of appeal to clarify ground 5 and to add new grounds concerning the operation of cl 10 of Sch 2 to the Land Lease Communities Act. The grounds of appeal relied upon, in their final form, were as follows:
"i) The Tribunal lacks the jurisdiction to proceed with a valuation of the residents dwellings pursuant to s130A as the necessary jurisdictional fact required to enliven its power was absent, being no proposed offer from any of the residents to sell their dwellings to the park owner as s130A cannot be enlivened, s113(3A)(b) can not be satisfied. This being the case, orders for termination and possession of each residential site cannot be made.
ii) The Tribunal erred in deciding that s113(3A)(b) can operate as a unilateral contract.
iii) The Tribunal erred in deciding that there is no practical difference between the requirements set out in s113(3A)(b) and (c)
iv) The Tribunal erred in deciding that the value of a dwelling excludes the bundle of rights attached to the residents dwelling under a residential site agreement (residential parks).
v) [deleted]
vi) The Tribunal erred in attributing weight to the Expert Report and evidence of Mr. Hoolihan.
vii) The Tribunal erred in relying on the valuations of the dwellings as provided by Mr. Hoolihan in order to determine their value for the purposes of s130A.
viii) The Tribunal failed to take into account the orders from the Land & Environment Court in relation to the termination date for Mr Tuckers tenancy.
ix) The Parties and the Tribunal erred in failing to take into account the provisions of clause 10, Schedule 2 of the Residential (Land Lease) Communities Act 2013, which came into effect on 1 November 2015 and which is applicable to the determination of compensation in this matter.
x) Pursuant to the compensation regime as provided for by the Residential (Land Lease) Communities Act 2013, compensation in this matter is to be provided in accordance with s141 of that Act.
1. The residents, in their amended grounds of appeal, sought the following orders on appeal:
"i) The Park Owners application for termination and/or possession is dismissed.
In the Alternative
ii) The matter should be remitted for compensation to be determined in accordance with s141 Residential Land Lease Communities Act2013, to enable a termination and possession in favour of the Park Owner.
iii) Costs in favour of the Appellants."
Nature of the Appeal
1. The Tribunal's decision in each case, being the orders of 6 April 2016, was a final decision made in proceedings for a general decision, within the meaning of s 29 of the NCAT Act, and thus was an internally appealable decision for the purposes of s 32 of the NCAT Act. By s 80(2)(b) of the NCAT Act, an appeal from an internally appealable decision, other than an interlocutory decision, lies, as of right, on any question of law or, with the leave of the Appeal Panel, on any other ground.
2. In the present appeals, the residents have not sought leave to appeal and have proceeded solely on the questions of law in their grounds of appeal.
The Owner's reply to appeal
1. The owner's reply to appeal took issue with each of the grounds of appeal and contended that each of the orders made by the Tribunal below could be supported and should be maintained. The orders sought by the owner on the appeal were that the appeals be dismissed and the residents pay the owner's costs.
Nature of Issues raised by the Grounds of Appeal
1. Grounds 1, 2, 3, 4, 8, 9 and 10 depend, in whole or in part, on the construction of the provisions of the Residential Parks Act dealing with:
1. residential site agreements and residential tenancy agreements and the rights and obligations created by those agreements and the Residential Parks Act;
2. termination by the Tribunal of those agreements after the giving of an appropriate notice of termination and the making of possession orders; and
3. statutory compensation and other means of protecting residents from loss when their agreements are so terminated and they are required to give up possession.
1. Grounds 6 and 7 deal with whether the Tribunal erred in accepting the opinions contained in the valuer's report as establishing the relevant value of the dwellings in question.
2. Grounds 9 and 10 also involve the construction of the Land Lease Communities Act and in particular:
1. the transitional provisions dealing with the extent to which the Residential Parks Act continues to apply in proceedings commenced before the Land Lease Communities Act came into force and the Residential Parks Act was repealed; and
2. the transitional and substantive provisions concerning the payment of compensation in the case of termination of site agreements.
1. Accordingly, it is convenient to note relevant principles of statutory construction and consider the relevant provisions of the Residential Parks Act first before dealing with each of the grounds of appeal.
Relevant Principles of Statutory Construction
1. The principles of statutory construction which are relevant in the present appeals include the following:
1. The process of statutory construction begins with the statutory text and, in a sense, also ends with the statutory text, but it must be considered in its context: Commissioner of Taxation v Consolidated Media Holdings Ltd [2012] HCA 55; 250 CLR 503 at [39];
2. The context of the statutory text includes:
1. extrinsic material to which reference may be had under s 34 of the Interpretation Act 1987 (NSW) but only so far as it assists in ascertaining the meaning of the statutory text since such material cannot displace the meaning of the text: Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue [2009] HCA 41; 239 CLR 27 at [47]; Bignill v Director of Public Prosecutions [2016] NSWCA 13 at [25];
2. the legislative history: Thiess v Collector of Customs [2014] HCA 12; 250 CLR 664 at [22]; Bignill v Director of Public Prosecutions [2016] NSWCA 13 at [25]; and
3. the objectively determined purpose and policy of the provision and the mischief it is seeking to remedy: Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue [2009] HCA 41; 239 CLR 27 at [47]; Thiess v Collector of Customs [2014] HCA 12; 250 CLR 664 at [23]; Bignill v Director of Public Prosecutions [2016] NSWCA 13 at [25];
1. Ordinarily the legal meaning will correspond with the grammatical meaning of a provision but not always. The context of the words, the consequences of a literal or grammatical construction, the purpose of the provision or the principles of construction may require the words of a legislative provision to be read in a way that does not correspond with the literal or grammatical meaning: Project Blue Sky v Australian Broadcasting Authority [1998] HCA 28; 194 CLR 355 at [78];
2. The context, the general purpose and policy of a provision and its consistency and fairness may be surer guides to its meaning than the logic with which it is constructed: Commissioner for Railways (NSW) v Agalianos [1955] HCA 27; 92 CLR 390 at 397;
3. In relation to repealing Acts and transitional provisions, the effect of s 30(1) of the Interpretation Act 1987 (NSW) (the Interpretation Act) in preserving rights, obligations or liabilities acquired or accrued under a repealed Act and legal proceedings or remedies in respect of such rights, obligations or interests may be displaced by the transitional provisions found in the repealing Act in so far as they express a contrary intention: Interpretation Act, s 5(2); ADCO Constructions Pty Ltd v Goudappel [2014] HCA 18; 254 CLR 1 at [27]; SL v Secretary, Department of Family and Community Services [2016] NSWCA 124 at [35];
4. When a provision is remedial and beneficial in character, its language should be construed so as to give the most complete remedy which is consistent with the actual language employed and to which its words are fairly open; it should be given a liberal rather than a constrained interpretation: Khoury v Government Insurance Office of (NSW) [1984] HCA 55; 165 CLR 622 at 638; Dionisatos v Acrow Formwork & Scaffolding Pty Ltd [2015] NSWCA 281 at [12];
5. The primary object of statutory construction is to construe the relevant provision so that it is consistent with the language and purpose of all the provisions of the statute and on the prima facie basis that its provisions are intended to give effect to harmonious goals: Project Blue Sky v Australian Broadcasting Authority [1998] HCA 28; 194 CLR 355 at [69] and [70].
Relevant Provisions of the Residential Parks Act
1. These appeals concern residential site agreements between the owner of a residential park and residents of the park, their respective rights and obligations under those agreements and the protections afforded to residents when the agreements are terminated. The applicable Act is the Residential Parks Act. The most relevant provisions of the Residential Parks Act for present purposes are:
1. the long title and objects;
2. Part 3 - Residential tenancy agreements relating to residential parks;
3. Part 4 - Rights and obligations of park owners and residents; and
4. Part 12 - Termination of residential tenancy agreements.
Long Title and Objects
1. The long title of the Residential Parks Act is:
"An Act to set out the rights and obligations of residents and owners of residential parks, including rights and obligations that arise under residential tenancy agreements; and for other purposes."
1. Thus, at the outset, it is emphasised that the Residential Parks Act is concerned not with the rights of residents alone or of owners alone but with the rights of both groups, balanced by their respective obligations. This approach is confirmed by the objects of the Act set out in s 4A as follows:
"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."
1. The reference to "legislative protection for residents" in s 4A(b) indicates an intention to benefit residents by protecting their rights or interests. The surrounding paragraphs make clear that this protection is to operate in the context of the rights and obligations of owners and any decisions of the Tribunal resolving disputes between owners and residents. Nonetheless, it is appropriate in our view to take into account, when construing particular provisions of the Residential Parks Act, the express object of protecting residents. The provisions which assist to protect residents should be construed as remedial and beneficial provisions.
Part 3 – Relevant Agreements and Related Definitions
1. Part 3, ss 8 – 16A, establishes, for park owners and residents, a regime of standard form residential tenancy agreements which must contain certain terms, see in particular ss 8 – 11, 13 and 16A and the Residential Parks Regulation 2009. This regime includes two types of residential tenancy agreements.
2. The first is a general type of agreement called a "residential tenancy agreement" and relates to occupation of "residential premises". "Residential tenancy agreement" is defined in s 3(1) of that Act as meaning:
"… any agreement under which a person grants to another person for value a right of occupation of residential premises for the purpose of use as a residence:
(a) whether or not the right is a right of exclusive occupation, and
(b) whether the agreement is express or implied, and
(c) whether the agreement is oral or in writing, or partly oral and partly in writing,
and includes such an agreement granting the right to occupy residential premises together with the letting of goods."
1. The "residential premises" that are to be occupied under such an agreement are defined in s 3(1) as follows:
"residential premises:
(a) means any premises or part of premises (including any land occupied with the premises) used or intended to be used as a place of residence, and
(b) includes a residential site on which a moveable dwelling is situated or intended to be situated (or both a moveable dwelling and residential site), if the moveable dwelling is used or intended to be used as a place of residence."
1. The definition of "residential tenancy agreement" is entirely general and paragraph (b) of the definition of "residential premises" is the first indication that the premises the subject of a residential tenancy agreement might be located in a residential park. The issue of the generality of the definition is addressed in s 5(1) of the Residential Parks Act where it is provided that the 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."
1. Under s 3(1), a "residential site" refers to a site to be used for the installation of a moveable dwelling within a "residential park", which means essentially a caravan park or a manufactured home estate.
2. The second type of agreement, "a residential site agreement", is a subset of the first but it relates specifically to the occupation of a "residential site" in a residential park. Section 3(1) relevantly provides:
"residential site agreement means a residential tenancy agreement under which:
(a) the park owner grants to the resident:
(i) a right to install, on a residential site, a relocatable home, or a registrable moveable dwelling with a rigid annexe attached to it (being a relocatable home or registrable moveable dwelling owned by the resident), and
(ii) a right to use the home or dwelling as a residence, and
(b) the resident occupies the premises as the resident's principal place of residence, and
(c) in the case of an agreement entered into after the commencement of section 5, the resident has the approval of the park owner or park manager to occupy the premises as the resident's principal place of residence,
but does not include such a residential tenancy agreement with respect to land [of a type not relevant to the present appeals]."
1. Thus, a "residential site agreement" is a residential tenancy agreement by means of which a resident obtains from a park owner two rights:
1. the right to install "on a residential site", a "home or dwelling" owned by the resident; and
2. the right to use the dwelling as a residence,
together with the park owner's approval for the resident to occupy the "premises" as the resident's principal place of residence.
1. It is important to note that under this definition the park owner does not own the "home or dwelling" that may be installed on the site. The resident owns the home or dwelling. This explains why such an agreement is called a "residential site agreement". Where the park owner owns the home or dwelling, the applicable agreement is a residential tenancy agreement.
2. The agreements that the park owner asked the Tribunal below to terminate were residential site agreements.
3. It is necessary at this point to consider in more detail three expressions in the definition of a "residential site agreement", namely: "a residential site"; a "home or dwelling"; and "premises". An understanding of how these terms are used in the context of the definition of "residential site agreement" provides some assistance in understanding how ss 113(3A) and 130A of the Residential Parks Act operate so as to protect residents whose residential site agreements are terminated and who cannot remove their home or dwelling from the site or choose not to do so.
4. Residential Site. A "residential site", according to s 3(1), "means a site within a residential park that is used, or is intended to be used, for the installation of a moveable dwelling". It can be seen from this definition that the "site" and the "moveable dwelling" to be installed on the site are distinct and different things and the "site" does not include the "dwelling".
5. Home or Dwelling. The expression "home or dwelling" in subpar (a)(ii) of the definition of "residential site agreement" refers back to the words "a relocatable home, or a registrable moveable dwelling with a rigid annexe attached to it" in subpar (a)(i) of that definition. According to s 3(1), "a relocatable home" is a type of "dwelling", namely "a moveable dwelling that is not … a registrable moveable dwelling, or … a moveable dwelling of a type prescribed by the regulations … [It does not appear that any types are prescribed by the regulations]". A "registrable moveable dwelling" is obviously another type of moveable dwelling. Thus, the right to install a "home or dwelling" on a residential site is a right to install one or other type of "moveable dwelling" referred to in the definitions section.
6. The 'home or dwelling", unlike a house built on land, does not become part of the land. On termination of a site agreement, if the resident cannot, or chooses not to, remove the dwelling from the site, it may be dealt with as abandoned goods under Div 8 of Pt 12 of the Residential Parks Act. The definition of "goods" in s 131 expressly includes "a relocatable home or a registered moveable dwelling owned by a resident". If this occurs, the resident will lose his or her place of residence as well as the value of the dwelling, absent a mechanism for compensation.
7. The words used to describe the types of dwelling that may be installed on a residential site under a residential site agreement, in subpar (a)(i) of the definition of that type of agreement, are also used in ss 99(5), 100(4), 128(8) and 130A(8) to define "dwelling" for the purposes of each of those sections. Each of those subsections provide:
"dwelling means a relocatable home or a registrable moveable dwelling with a rigid annexe attached to it."
1. Thus, "dwelling" is given a consistent meaning across various sections. In ss 128 and 130A, "dwelling" is used in the context of providing statutory compensation for, or protecting residents from, loss when their residential site agreement is terminated.
2. Premises. Under a "residential site agreement" approval is given for the resident to occupy the "premises" as the resident's principal place of residence. The use of the word "premises" appears to refer back to the expression "residential premises" in the definition of "residential tenancy agreement". As defined in s 3(1), "residential premises" relevantly include "a residential site on which a moveable dwelling is situated or intended to be situated (or both a moveable dwelling and residential site), if the moveable dwelling is used or intended to be used as a place of residence". Thus "residential premises" may, or may not, include the dwelling installed on the residential site, depending on the circumstances.
3. The remaining provisions of Pt 3, ss 12, 14, 15 and 16 relate to other aspects of residential tenancy agreements that are not relevant to the present proceedings.
Part 4 - Rights Attaching to Residential Tenancy Agreements
1. Part 4, ss 17 – 43, of the Residential Parks Act is headed "Rights and obligations of park owners and residents". For present purposes, the relevant sections are ss 20, 41 and 43. The other rights and obligations, although important for residents and owners, do not have a role to play in these proceedings.
2. Section 20(1) confers a right of quiet enjoyment on a resident by incorporating a statutory term into every residential tenancy agreement. Subsection (2) makes it an offence if the term is contravened. The section provides:
(1) It is a term of every residential tenancy agreement that:
(a) the resident must have quiet enjoyment of the residential premises without interruption by the park owner or any person claiming by, through or under the park owner or having superior title to that of the park owner, and
(b) the park owner or the park manager must not interfere, or cause or permit any interference, with the reasonable peace, comfort or privacy of the resident in using the residential premises.
(2) A park owner or a park manager under a residential tenancy agreement must not, during the currency of the agreement, contravene or fail to comply with subsection (1).
Maximum penalty: 10 penalty units.
1. From this it can be seen that the right to quiet enjoyment is a term of every residential tenancy agreement, and therefore of every residential site agreement. This right is something that expressly relates to the "residential premises" which may, but do not necessarily, include the dwelling installed on the site. Where the resident owns the dwelling, the right of quiet enjoyment created by s 20 relates only to the site rather than to the dwelling. This is because the right to quiet enjoyment of the dwelling is not one that the park owner can confer since it derives from the resident's ownership of the dwelling.
2. Similarly, s 41 confers on a resident, by way of an express statutory term in every residential tenancy agreement, a right to assign rights and obligations or sub-let. Section 41 relevantly provides:
"(1) It is a term of every residential tenancy agreement that:
(a) the resident may, with the prior consent of the park owner, assign the whole or part of the resident's rights and obligations under the agreement or sub-let the residential premises, and
(b) the park owner must not make any charge for giving such a consent, other than for the park owner's reasonable expenses in giving consent.
(2) Despite section 133B of the Conveyancing Act 1919 or any other law, it is not a term of a residential tenancy agreement that the park owner must not unreasonably withhold or refuse consent to an assignment or sub-letting referred to in subsection (1).
(3) It is, however, a term of every residential site agreement that the park owner may not unreasonably withhold or refuse consent to an assignment or sub-letting referred to in subsection (1).
…".
1. This section permits the assignment of the whole or part of the resident's rights under the agreement and could involve, for example, the assignment of the right to install a dwelling owned by the assignee on the site in question and the right to use that dwelling as a residence. Alternatively, the resident could sub-let the "residential premises", which could be just the site or the site and the dwelling installed on the site, as a result of the definition of "residential premises".
2. Where the resident owns the dwelling, the rights of assignment and sub-letting created by s 41 relate only to the site, which is the subject of the residential site agreement, and not the dwelling. Once again, the resident's right to transfer the dwelling or allow it to be used by another person arises out of his or her ownership of the dwelling, not out of the residential site agreement.
3. Finally, s 43 creates certain rights for an occupant of "residential premises" to apply to be recognised as a resident under the residential tenancy agreement in respect of those premises if the former resident has died or left. Section 43 relevantly provides:
"(1) A person who is occupying residential premises may:
(a) on the death of the resident under a residential tenancy agreement to which the premises are subject, or
(b) if the resident no longer occupies the premises,
apply to the Tribunal to be recognised as a resident under the agreement or to be joined as a party to any proceedings before the Tribunal relating to the premises, or both.
(2) An application by a person to be recognised as a resident may be made at the same time as any other application or during proceedings before the Tribunal or independently of any such other application or proceedings.
(3) The Tribunal may, on application by a person under this section:
(a) make an order recognising the person as a resident under a residential tenancy agreement and the person is taken, for the purposes of this or any other Act and of the agreement, to be a resident under the agreement, or
(b) make an order joining the person as a party to proceedings,
or both.
(4) The Tribunal may, if a person has made an application to be recognised as a resident and if it thinks it appropriate to do so in the circumstances, make an order vesting a tenancy over the residential premises in the person on such of the terms and conditions that applied under the previous residential tenancy agreement for the premises as are in its opinion, having regard to the circumstances of the case, appropriate.
1. The rights created by this provision relate to the residential tenancy agreement and the "residential premises". As under ss 20 and 41, if the agreement is a residential site agreement and the resident in question owns the dwelling, property in the dwelling will not pass under s 43 but will be determined by the law of succession or the law relating to the transfer of title to goods.
Part 12 – Termination of residential tenancy agreements
1. As the heading of Part 12 of the Residential Parks Act indicates, that Part deals with termination of residential tenancy agreements relating to residential parks. This is the Part of the Residential Parks Act that is at the heart of this appeal and it is necessary to examine its relevant provisions in some detail.
Part 12 Division 1 - Termination generally
1. The only provision of Div 1 of Pt 12 relevant for present purposes is s 95. This section establishes the principle that a residential tenancy agreement (including a residential site agreement) governed by the Residential Parks Act terminates only in the circumstances set out in that section. Those circumstances relevantly include:
"(a) if the park owner or the resident gives notice of termination under this Part and:
…
(ii) the Tribunal makes an order under section 113 (which relates to applications to the Tribunal by the park owner for termination) terminating the agreement,
…"
1. Thus, termination depends on the giving of a notice of termination and the Tribunal making an order for termination.
Part 12 Division 2 - Grounds for termination of a residential site agreement
1. A notice of termination of a residential site agreement can be given on the grounds specified in Div 2 of Pt 12, ss 98 – 104. A park owner can give a notice of termination on the following grounds:
1. breach of the residential site agreement by the resident because of non-payment of rent: s 98;
2. breach of the residential site agreement by the resident because of the dilapidated condition of the dwelling installed on the residential site: s 99;
3. other breach of the residential site agreement by the resident that is a serious or persistent breach of the residential site agreement: s 100;
4. the owner requires vacant possession of the residential site to carry out work, including repairs and upgrading: s 101;
5. the residential site is to be used for a purpose other than that of a residential site: s 102; and
6. the residential premises under a residential site agreement are, otherwise than as a result of a breach of the agreement, destroyed or rendered uninhabitable or cease to be lawfully usable for the purpose of a residence or are acquired by any authority by compulsory process: s 104.
1. Section 102AA permits the Tribunal to approve an owner's notice of termination for change of use in certain circumstances. In addition, residents can give notices of termination to park owners in the circumstances set out in ss 102A and 103. None of these sections is relevant to the present case.
2. If a park owner gives a notice of termination on a ground that involves a breach of the agreement by the resident or a no grounds notice of termination of a non-fixed term agreement, ss 98, 99 and 100 do not confer on the resident a right to statutory compensation. By way of contrast, the resident has such an entitlement if the park owner gives a notice under the following sections:
1. s 101, where the residential site agreement is terminated on the ground that the vacant possession of the site is required for obligatory repairs or upgrades, see s 101(3);
2. s 102, where the agreement is terminated on the ground of change of use, see s 102(5);
3. s 104, where the agreement is terminated in effect on the ground of frustration, see s 104(3), although the availability of the right to compensation in this case is limited to certain specified circumstances.
1. Section 102 was the only section relied upon in the present proceedings and relevantly provides:
"(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.
…
(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.
…."
1. All parties in the Tribunal below accepted that the requirements of s 102 concerning notices of termination and all other relevant aspects of this section had been complied with.
2. Section 102 provides protection for a resident whose residential site agreement is to be terminated because of a change of use including:
1. a 12 month notice period for a non-fixed term agreement – s 102(2);
2. an entitlement to be paid compensation by the park owner in accordance with s 128 – s 102(5); and
3. a requirement that the notice of termination include a statement to the effect that the resident may be entitled to be paid compensation under s 128 which, if payable, must be paid in full before the resident is required to deliver up vacant possession – see s 102(4)(b).
Part 12 Division 3 - Grounds for termination of a residential tenancy agreement that is not a residential site agreement
1. Division 3 of Pt 12, ss 105 to 110, deals with notice of termination of residential tenancy agreements that are not residential site agreements. These are not relevant on these appeals.
Part 12 Division 4 - Notices of termination
1. Division 4 of Pt 12, ss 111 and 112, governs notices of termination. All parties accepted that each of the notices of termination in question were valid and lawful. Consequently it is not necessary to consider this Division further.
Part 12 Division 5 - Termination of residential tenancy agreements by Tribunal
1. The provisions setting out the Tribunal's role in terminating residential tenancy agreements are found in Div 5 of Pt 12, ss 113 to 120.
2. Under s 113, a park owner may apply to the Tribunal for termination of a residential tenancy agreement after a notice of termination has been given under Pt 12. The owner applied under s 113 in these proceedings.
3. Section 114 relevantly permits the Tribunal to suspend possession orders.
4. The other sections in Div 5 are:
1. s 115, which allows the Tribunal to waive defects in notices of termination;
2. s 116 under which applications may be made for termination orders, whether or not a notice of termination has been given; and
3. ss 117 to 120, which set out the circumstances in which applications under s 116 can be made.
These other sections are not relevant in these matters. Thus, the sections of Div 5 of Pt 12 that we shall consider in more detail are ss 113 and 114.
1. Section 113 relevantly provides:
"(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,
…
(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,
…"
1. There was no dispute that the requirements in s 113(3) were satisfied in these cases. Similarly, there was no dispute that the ground of change of use had been established. Consequently, the Tribunal below was required by s 113(2) to make the termination orders. No ground of appeal challenged any of these foundations for the making of the termination orders.
2. The Tribunal having made the termination orders, s 113(4)(a) also required that the Tribunal make orders for possession specifying the day on which the orders were to take effect.
3. In the case of a residential tenancy agreement which is a residential site agreement, vacant possession so as to comply with an order made under s 113(4)(a) can be given in a number of ways. First, the resident can give vacant possession of the residential site in question after the dwelling has been removed to a new residential site or to another location. Secondly, if the resident cannot or does not wish to remove the dwelling or sell it to a third party for relocation, the resident can give vacant possession of the site with the dwelling still installed. In this situation, the dwelling would be able to be disposed of under Div 8 of Pt 12, which deals with abandoned goods (which include dwellings). Thirdly, the owner and the resident could reach some other agreement as to how the possession order is to be satisfied.
4. The ability of the Tribunal to make a possession order as required by s 113(4)(a) is, however, limited by s 113(3A). The effect of s 113(3A) is that the Tribunal cannot make a possession order unless the Tribunal is satisfied of one or more of the matters set out in s 113(3A)(a), (b) or (c).
5. Paragraph (a) covers the situation where the dwelling is to be removed, either to a different residential park or to some other location. In such a case, before a possession order can be made, the Tribunal must be satisfied that compensation for the cost of relocation of the dwelling to its new location has been determined under s 128.
6. Paragraph (b) deals with the situation where the resident is forced or chooses to leave the dwelling installed on the residential site when vacating. In this situation, the resident is protected against losing the value of the dwelling by the requirement that the Tribunal must be satisfied that the owner has agreed to buy the dwelling from the resident at a price not less than its value, as determined under s 130A, before a possession order can be made.
7. Paragraph (c) permits the Tribunal to make a possession order if the owner and the resident have reached an acceptable negotiated settlement, and that agreement is bona fide. This paragraph allows a resident flexibility in protecting his or her interests in the event of a termination, by negotiating an agreement with the owner.
8. These three paragraphs can legitimately be seen as an attempt "to establish legislative protection for residents" as referred to in s 4A(b) of the objects of the Residential Parks Act. The manifest purpose of s 113(3A) as a whole is to ensure that residents have the opportunity to obtain compensation, in the broad sense, from an owner who legitimately obtains possession of residential sites because the owner wishes to use the sites for a use other than as a residential site. As noted above, however, only par (b) was applicable in the present matters.
9. Section 114 relevantly includes the following:
"(1) The Tribunal may suspend the operation of an order for possession of residential premises … for a specified period if it is satisfied that it is desirable to do so, having regard to the relative hardship likely to be caused to the park owner and the resident by the suspension.
…"
1. The Tribunal at first instance suspended the operation of each of the possession orders, under s 114(1), until the payment of the amount determined to be the value of each of the dwellings was made or tendered. None of the grounds of appeal challenged the making of this order, if the order for possession stood.
Part 12 Division 6 - Recovery of possession of residential premises
1. Division 6 of Pt 12, ss 121 to 126, deals with the mechanics of the recovery of possession and does not play any part in these proceedings.
Part 12 Division 7 - Compensation for termination of a residential site agreement
1. Division 7 of Pt 12 is headed "Compensation for termination of a residential site agreement" and contains three types of provisions:
1. provisions dealing with relocation of residents as a result of a notice to relocate or by agreement, ss 127 and 129 respectively, and the effect of relocation generally, s 130. These provisions are not relevant to this appeal;
2. provisions relating to statutory compensation, ss 128 and 128A;
3. a provision permitting the Tribunal to value a dwelling to facilitate a sale from the resident to the park owner, s 130A.
1. Section 128 is the provision which establishes the mechanism for, and factors to be taken into account when, determining the amount of statutory compensation to which a resident is entitled if a residential site agreement is terminated on one of the grounds referred to in ss 101, 102 or 104.
2. Section 128 relevantly provides as follows:
"(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
...
(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.
(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.
(3) In fixing the amount of compensation to which a resident is entitled in connection with the relocation of a dwelling to a new residential site, whether in accordance with the requirements of a notice under section 127 or otherwise, 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, and the possessions of its residents, to the new residential site,
(c) the reasonable costs of installing the dwelling at the new residential site (including the costs of connecting to the available services),
(d) the reasonable costs of repairing any damage to the dwelling arising from its relocation,
(e) the reasonable costs of landscaping the new residential site so as to bring it up to the condition of the old residential site,
(f) the value of any financial or other assistance that the park owner has given to the resident in connection with the relocation.
(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.
(5) Compensation is not payable under subsection (3) (d) or (4) (d) for an amount in excess of the value of the dwelling.
(6) Compensation is not payable under subsection (4) (b) or (c) for a distance of travel of more than 500 kilometres.
(7) This section operates to the exclusion of any provision of any Act that limits the amount for which the Tribunal can make an order.
(8) In this section:
dwelling means a relocatable home or a registrable moveable dwelling with a rigid annexe attached to it."
1. Under s 128(1) and (2) the Tribunal can fix the amount of compensation by order. An application for such an order can be made in proceedings under s 113 for termination orders or in proceedings commenced within 6 months of the resident's vacating the site in compliance with a notice under s 102. An application for a further compensation order can be made under s 128(2A) if compensation previously fixed proves inadequate.
2. The factors to which regard must be had, however, differ according to whether the dwelling is to be relocated to a new residential site or not.
3. If the dwelling is to be relocated to a new residential site, the relevant matters to which the Tribunal must have regard in fixing the compensation to which the resident is entitled are set out in subs (3). These matters are obviously related to relocation of the dwelling and the resident.
4. If, on the other hand, compensation is to be fixed "otherwise than in connection with the relocation of a dwelling to a new residential site" the Tribunal must have regard to the matters set out in subs (4). The nature of the matters listed in subs (4) suggests that the subsection was intended to apply where the dwelling was to be removed from the site and transported to some location other than a residential site. This might occur if the resident wished to install the dwelling on land not in a residential park or if the resident sold the dwelling to a purchaser other than the park owner. The subs (4) matters do not appear to anticipate that a resident might require compensation for the loss of the value of the dwelling because it was being left on the site. The dwelling's value is not mentioned in subs (4). The value of the dwelling only appears in subs (5) as a cap on the amount of statutory compensation payable in relation to "the reasonable costs of repairing any damage to the dwelling arising from its relocation" for the purposes of both par (3)(d) and par (4)(d).
5. The value of the dwelling is not expressly excluded from consideration where compensation is to be determined "otherwise than in connection with the relocation of a dwelling to a new residential site" under subs (4). Nonetheless, given its terms, subs (4) is not particularly well suited to providing appropriate compensation if the resident cannot, or chooses not to, relocate the dwelling on termination.
6. Section 128A provides as follows:
"(1) This section applies if the Tribunal makes an order fixing the amount of compensation that a resident is entitled to be paid by a park owner as a consequence of:
(a) the resident giving up possession of residential premises, as referred to in section 102, or
(b) the resident relocating to a different residential site, as referred to in section 127.
(2) Despite any other provision of this Act, a resident who becomes entitled to compensation before he or she gives up possession of residential premises may not be required to give up possession of the premises until the compensation has been paid in full."
1. This section relevantly applies where a termination notice for change of use has been given under s 102, as in the present case, and the Tribunal has made an order fixing compensation under s 128. In these circumstances, s 128A requires compensation to be paid in full before a resident has to give up possession. This is consistent with the statement that is required, by s 102(4)(b), to appear in a termination notice for change of use under s 102.
2. If, however, the Tribunal has not fixed compensation under s 128, s 128A does not apply and a resident can be required to give possession before any compensation is paid.
3. The final section in Div 7 of Pt 12 is s 130A, which can operate both as a stand-alone provision and in conjunction with s 113(3A)(b).
4. Section 130A empowers the Tribunal to determine the value of a dwelling for the purpose of facilitating a proposed sale from the resident to the park owner. This section is picked up by s 113(3A)(b), under which the Tribunal may make a possession order if it is satisfied that the owner has agreed to buy the dwelling from the resident at a price no less than its value, as determined by the Tribunal under s 130A.
5. Section 130A is important because it was the section under which the Tribunal at first instance determined the value of the dwellings in question.
6. Section 130A provides:
"(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."
1. The object of the section set out in s 130A(1) 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. The circumstance in which it would be relevant to provide this assistance is described as being "where there is a proposed sale of the dwelling from the resident to the park owner".
2. The considerations or principles by which the Tribunal is to determine the value of the dwelling are left undefined by the section except that subs (4) excludes the location of the dwelling from consideration. Nonetheless, the ability of the Tribunal to rely upon a valuation of the dwelling from a registered valuer in subs (2) indicates an intention that the principles to be employed are standard valuation principles.
3. Consistently with the object of the section and its use under s 113(3A)(b), the Tribunal's determination of a dwelling's value 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" – see subs (5). In each case, the resident is free to decide whether to sell or not.
4. From the terms of s 130A, its role in s 113(3A)(b) and its inclusion in the division which is headed "Compensation for termination of a resident site agreement", it appears to us that s 130A and s 113(3A)(b) are designed to give residents the protection of being offered compensation if their residential site agreements are terminated and their dwellings are not to be removed. The protection is offered to the residents but there is no compulsion on the resident to accept it. Allowing residents to choose whether or not to accept such offers could be seen as preferable to a statutory compulsory acquisition of the dwelling by the owner in the circumstances.
5. The Residential Parks Act consequently has at least two relevant mechanisms for compensating residents whose site agreements are terminated for change of use. First, there is compensation under s 128, but that section does not contain provisions that are well adapted to the situation where the dwelling is to be left on the residential site on termination. Secondly, there is the effective compensation that is offered if s 113(3A)(b) is relied upon as the basis for making possession orders. In that case, the compensation on offer includes the value of a dwelling, as determined under s 130A.
6. There are no express provisions dealing with how those two mechanisms interact. Nonetheless, it is significant that nothing in s 130A or s 113(3A) precludes a resident from seeking compensation under s 128, if the resident can do so, for example, by operation of s 102(5) and s 128(2)(a) or (c).
7. The less than satisfactory nature of the factors in s 128(4) for fixing compensation where a dwelling was not to be removed from the site on termination has been noted above. This problem was, at least, part of the mischief sought to be addressed by the Residential Parks Amendment (Statutory Review) Act 2005 (NSW) (the 2005 Amendment Act) which introduced ss 113(3A) and 130A, as well as amendments to s 102.
8. The construction of ss 113(3A) and 130A should also be informed by the context provided by their legislative history and the mischief they were designed to overcome. We shall address these matters after completing the review of Pt 12.
Pt 12 Div 8 - Abandoned premises and goods
1. Division 8 is the last Division in Pt 12 and deals, as its heading indicates, with how goods, including dwellings, left on residential sites after the relevant residential tenancy agreements are terminated, may be disposed of. The Division is not relevant for present purposes.
Relevant Legislative History of the Residential Parks Act and Extrinsic Material
1. The Residential Parks Act came into force on 1 March 1999. At this time it did not include, among other sections, the objects section, s 4A, or ss 113(3A), 128A and 130A. These sections were inserted by the 2005 Amendment Act. That same Act also relevantly made a number of corresponding changes to s 102.
2. The Amendment Act arose out of the five-year review of the operation of the Residential Parks Act. The purpose of the amendments to s 102 and the insertion of ss 113(3A), 128A and 130A is said in the second reading speech to be related to "two prime areas of concern—termination of tenancies for redevelopment and the payment of compensation". In her speech, the Minister said (New South Wales Legislative Assembly, Parliamentary Debates (Hansard), 8 November 2005 at 19227):
"… When residents find that their only option is to sell their home to the park owner but agreement cannot be reached on a fair price, the tribunal will have the jurisdiction to break the deadlock and provide an independent valuation with the assistance of qualified valuers.
…
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. ...
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. …
…
…The notice of termination will make it clear that residents have the right to remain in possession until the tribunal orders them to leave, and to be paid compensation by the park owner in line with the requirements of the legislation.
… 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. Park residents who live in their own homes on rented sites and have their tenancies terminated have had access to compensation for more than 10 years now. This right will continue, but with some necessary improvements.
Compensation is currently payable to assist residents in moving their homes to another location and having services reconnected. The amount of compensation payable is assessed by the Consumer, Trader and Tenancy Tribunal. A number of refinements to the compensation provisions are contained in the bill. I will quickly highlight what these amendments will achieve. Firstly, residents will be entitled to get their compensation before they leave. In fact, they will have the right to remain in the park until they get it. …
…
… The final item in this bill connected with the termination and compensation process deals with the scenario of the resident selling his or her home to the park owner in lieu of moving it somewhere else. I referred to this situation earlier.
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.
What is particularly galling to residents is that some park owners then on-sell the home for the amount that the original resident should have received, thus making a tidy sum on the basis of the resident's unfortunate predicament. This type of manipulation has clearly got to stop. The bill provides a circuit breaker for residents caught in this situation. The Consumer, Trader and Tenancy Tribunal will be given the power to establish a fair price where the resident and park owner cannot agree. The tribunal will be able to use the services of valuation experts to assist it in its task. In circumstances where a park is being redeveloped, park owners cannot begrudge residents for wanting a fair price for their home. This new provision will help to bring this about.
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. 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."
1. A number of observations can be made. First, a major area of concern identified in the second reading speech was "access to compensation" for residents when their residential tenancy agreements are terminated on the ground of change of use but their dwellings are not to be removed. Sections 113(3A) and 130A were apparently intended to provide a new mechanism bringing greater transparency and parity to the process of selling the dwellings to the park owner.
2. The second reading speech does not suggest that this mechanism was intended to displace entirely the mechanism already available, limited as it was, under s 128. Indeed, the 2005 Amendment Act reinforced the significance of s 128 compensation by introducing the requirement in s 128A that any compensation that had been fixed under s 128 should be paid before a resident was required to give up possession.
3. Secondly, the second reading speech made it clear that the s 130A mechanism was intended to be used "[w]hen residents find that their only option is to sell their home to the park owner but agreement cannot be reached on a fair price". The Tribunal's power under s 130A was also described as being "to establish a fair price where the resident and park owner cannot agree. The tribunal will be able to use the services of valuation experts to assist it in its task." This suggests that the mechanism was to be available if the resident and the park owner could not agree. This informs the proper understanding of the clause "where there is a proposed sale of the dwelling from the resident to the park owner" in s 130A(1) and of "agreed" in s 113(3A)(b).
4. Thirdly, the speech referred to the value of the dwelling being "calculated on its stand-alone value and will not include any component of the land which it stands upon". This was said to be an "even-handed provision" because "[i]t ensures that residents are not taken advantage of" and "[i]t makes it clear that park owners do not have to pay any proportion of the value of land that they already own". The references to "value" in s 130A generally and "location" in s 130A(4), in particular, have to be construed in the light of these statements.
5. We now turn to consider the individual grounds of appeal.
Ground 1
1. Ground 1 was to the effect that the Tribunal at first instance erred in law by determining a value for each of the dwellings under s 130A of the Residential Parks Act in the absence of the necessary jurisdictional fact required to enliven the power under s 130A. The relevant jurisdictional fact was said to be that there must be "a proposed sale of the dwelling from the resident to the park owner".
2. This jurisdictional fact was said to arise out of s 130A(1) which is in the following terms:
"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."
1. It was submitted that the inclusion of the words "where there is a proposed sale of the dwelling from the resident to the park owner" in subs (1) meant that the power conferred by s 130A could only be exercised if it was established that there was a proposed sale of the dwelling to the park owner and that the sale was proposed, or agreed to, by the resident.
2. In each of the cases the subject of the appeals, it was common ground that the resident did not want to sell to the dwelling to the owner and, thus it was submitted:
1. there was no sale proposed by the resident of the dwelling to the owner;
and consequently,
1. the power to determine the value of the resident's dwelling was not enlivened and could not be exercised.
1. The further consequence of this was then said to be that the Tribunal could not be satisfied of the matters referred to in s 113(3A)(b), namely, that 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 s 130A, because no such value had been, or could be, validly determined. Therefore, possession orders could never be made in the present cases, because the Tribunal could not be satisfied of the matter in s 113(3A)(b) and the other pars (a) and (c) were not applicable.
2. The Appeal Panel does not accept these submissions for a number of reasons. First, in our view, on the proper construction of s 130A, the object stated in subs (1) does not gives rise to a jurisdictional fact which must be established before the Tribunal can determine a value under s 130A(2). The purpose of subs (1) is merely to state the object of the section, its purpose is not to limit the circumstances in which the power conferred by the section can be exercised.
3. This is significant because s 130A does not operate only as a stand-alone provision. It is also picked up by s 113(3A)(b). Section 113(3A)(b) relies, in part, upon there being a value "as determined by the Tribunal under section 130A". In our view, the words "under section 130A", in s 113(3A)(b), mean in accordance with s 130A or using the method of determination of value set out in s 130A. Thus, while s 130A(1) establishes the object of that section, it should not be construed so as to prevent the section being relied upon as the method for determining the value of dwelling for the purposes of s 113(3A)(b).
4. This approach is consistent with the second reading speech (quoted above) which indicated that the s 130A mechanism was intended to be used "[w]hen residents find that their only option is to sell their home to the park owner but agreement cannot be reached on a fair price".
5. Secondly, if we are wrong and s 130A(1) does establish a jurisdictional fact which must be established before the Tribunal can exercise the power to determine the value, the requisite fact was established in these cases. If there is such a jurisdictional fact, it is that "there is a proposed sale of the dwelling from the resident to the park owner". The residents' submission was that this required there to be a sale proposed by the resident to the owner or a sale to which the resident agreed. This does not follow from the text of s 130A(1). Provided that there is a proposed sale of the dwelling and the resident is to be the vendor and the park owner is to be the buyer, any jurisdictional fact arising out of s 130A(1) will be established. It does not matter who has proposed such a sale. The words "from the resident" in subs (1) qualify "sale", they do not relate to which party proposed the sale.
6. In the present cases, the park owner was proposing to buy each of the dwellings from each of the residents. Thus, there was a proposed sale of the dwellings from the residents to the park owner. If s 130A(1) creates a jurisdictional fact, it was established in each case.
7. For these reasons, the Tribunal at first instance was relevantly empowered to determine the value of each of the dwellings under s 130A. There was no error by the Tribunal below in this regard. We reject the appeal based on ground 1.
Ground 2
1. The error of law was initially identified in ground 2 of the residents' ground of appeal as being that the Tribunal erred in deciding that s 113(3A)(b) could operate as a unilateral contract.
2. The residents' submissions as they were developed orally and in writing in relation to this ground went beyond the narrow wording of this ground of appeal. In substance, it was contended that:
1. s 113(3A) permits a possession order to be made only if the Tribunal is satisfied of at least one of the following:
1. compensation for the cost of relocating the dwelling to its new location has been determined under s 128 – par (a);
2. 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 s 130A – par (b);
3. the park owner and the resident have reached an acceptable negotiated settlement, and that agreement is bona fide – par (c);
1. s 113(3A)(a) did not apply in the present case;
2. the Tribunal could only be satisfied of the matters in s 113(3A)(c) if there was an agreed consensual resolution between the owner and the resident that was not limited to the sale of the dwelling and there was no such settlement in this case;
3. the Tribunal could only be satisfied of the matters in s 113(3A)(b) if the owner had agreed with the resident to buy the dwelling from the resident at an appropriate price and there was no such agreement in this case because none of the residents had agreed to sell;
4. therefore, the Tribunal could not make possession orders in these matters and by doing so the Tribunal below erred.
1. At [102] the Tribunal recorded the residents' submission that:
"subsections (b) and (c) of s 113(3A) of the RPA do not necessarily cover the same subject matter, with subsection (b) operating unilaterally and subsection (c) operating consensually. Rather, the subsections ought to be construed such that subsection (b) operates where there is a consensual sale and subsection (c) operates where there is an agreement between the parties which may deal with matters in addition to, or other than, the sale of the dwelling of the resident."
1. In reaching the decision that it did, the Tribunal below effectively rejected that submission. At [113] - [114], it held:
"113 A central issue in these proceedings is whether the Tribunal is able to be satisfied that the park owner has agreed to buy the dwelling from each resident at a price no less than its value as determined by the Tribunal under s 130A in circumstances where there is no proposed sale of any of the dwellings or no agreement for a sale involving the participation or consent of the respondents.
114 It is my view that s 113(3A)(b) refers to circumstances in which a park owner has satisfied the Tribunal that the park owner agrees to buy the dwelling from the resident at a price no less than its value (as determined under s 130A) even including where there is no evidence that the respondent will accept such an offer. In the context of this subsection, my view is that where the subsection states that the park owner "has agreed to buy the dwelling" it is to be taken as meaning that the park owner has offered to buy the dwelling from the resident."
1. This ground of appeal raises the proper construction of the words "the park owner has agreed to buy the dwelling from the resident" in s 113(3A)(b). The residents contend that these words are beneficial and designed to provide protection for residents and should be given a liberal interpretation so that residents cannot be dragooned out of their homes without their agreement. On the other hand, as the long title and the objects of the Residential Parks Act make clear, the park owner has rights as well as the residents. One of the rights that the park owner has is to redevelop the land on which the residential sites are located and to use it for a purpose other than as a residential park. If the owner seeks to do so, the notice and compensation provisions found in ss 102, 113(3A), 128 and s 130A, to the extent relevant, must be satisfied. The intention underlying these sections can be ascertained not only from their words but also from the second reading speech for the bill which introduced the 2005 Amendment Act, which has been referred to above.
2. The words in par (b) can be seen as ambiguous, since they do not identify how or with whom the owner "has agreed to buy the dwelling from the resident …". They could be limited to the situation where an agreement to buy the dwelling at an appropriate price has been reached by the owner with the resident, as the residents contend. Alternatively, the words could refer to the situation where the owner has committed itself in some way acceptable to the Tribunal, and in that sense agreed with the Tribunal, to buy the dwelling from the resident at an appropriate price.
3. If an agreement between the owner and the resident concerning relocation and compensation has been reached, this would, on the natural meaning of s 113(3A)(c), already be covered by that paragraph, provided the agreement was acceptable and bona fide. Indeed, the presence of par (c) suggests that s 113(3A)(b) was intended to be applicable where no agreement had been reached between the owner and the resident. The text and context of s 113(3A)(b) assist here in understanding what was intended.
4. In order for the Tribunal to be satisfied of the matter in s 113(3A)(b), the Tribunal would have to obtain from the owner, in some suitable form, the owner's agreement or commitment to buy the dwelling from the resident at an appropriate price. If it were otherwise, the Tribunal could not be satisfied that the owner had agreed to buy the dwelling from the resident at an appropriate price. This being so, "agreed" in s 113(3A)(b) can be seen as naturally referring to the owner's committing itself to the Tribunal to buy the dwelling at an appropriate price and thus agreeing with the Tribunal to do so. This is not something "agreed" in a contractual sense but in the wider meaning of the term.
5. In determining which construction should be adopted, it is also appropriate to take into account the context provided by the second reading speech and, in particular, the reason why s 113(3A) and s 130A were introduced. The second reading speech indicates that the s 130A mechanism, able to be relied upon for the purposes of s 113(3A)(b), was intended to be used "[w]hen residents find that their only option is to sell their home to the park owner but agreement cannot be reached on a fair price". The Tribunal's power under s 130A was also described as being "to establish a fair price where the resident and park owner cannot agree. The tribunal will be able to use the services of valuation experts to assist it in its task." This does not support the approach that s 113(3A)(b) and the s 130A mechanism are only applicable if the park owner's agreement is with the resident. Indeed, it was the very situation where there was no such agreement that s 113(3A) and s 130A were designed to address. The second reading speech lends little support for the residents' construction that s 113(3A)(b) applies only where agreement on a sale of the dwelling has been reached between the resident and the park owner. It is consistent with the position that the agreement referred to is between the owner and the Tribunal.
6. If s 113(3A)(b) is construed as being able to be satisfied where the owner agrees with the Tribunal, or commits itself in some way to the Tribunal, to buy the dwelling, the resident is not left without protection. Compensation, in the broader sense, will be available to the resident whose site agreement has been terminated because the resident could accept any purchase offer that the owner has agreed with the Tribunal that it would make to the resident. Any problem of passing of title to the dwelling (which is not provided for under s 128) would not arise because, if the offer was accepted, title to the dwelling would pass to the park owner on the sale. In addition, if there were some entitlement to further compensation, for example having regard to the factor in s 128(4)(c), an application for that compensation could be brought under s 128(2)(c) and renewed under s 128(2A).
7. Furthermore, adopting this construction would not allow the park owner's right to redevelop its land for other uses to be frustrated by residents who would not agree to sell their dwellings. The construction achieves an appropriate balance between the rights of the residents and the rights of the park owner. It ensures that the resident has available, if he or she chooses to accept it, compensation for the loss of the dwelling that is not to be relocated. At the same time, such a construction does not deprive the resident of any further compensation that may be payable under ss 102(5) and 128.
8. If the construction contended for by the residents were adopted, it would give the residents power to prevent or frustrate any change of use by the owner because they could choose not to relocate their dwellings and refuse to agree to sell to the park owner or reach any other agreement. In these circumstances, on the residents' construction, the Tribunal could not be satisfied of any of the matters in s 113(3A)(a), (b) or (c) and, as a result, orders requiring residents to give vacant possession of their sites could never be made. This is inconsistent with the objectively determined purpose of the provisions as indicated by the second reading speech.
9. Having regard to all these matters, the proper construction of s 113(3A)(b) is that the words "the park owner has agreed to buy the dwelling from the resident … [at the appropriate price]" cover the situation where the park owner has agreed to the satisfaction of, or committed itself in some way acceptable to, the Tribunal to buy the dwelling from the resident at an appropriate price, whether or not the resident has agreed to sell the dwelling at that or any other price.
10. This is not exactly the way in which the Tribunal below phrased its conclusion. At [114] of the reasons for decision below, it was said:
"… where the subsection [s 113(3A)(b)] states that the park owner "has agreed to buy the dwelling" it is to be taken as meaning that the park owner has offered to buy the dwelling from the resident".
1. We would say that the park owner "has agreed to buy the dwelling from the resident [at an appropriate price]" if the park owner has agreed to buy the dwelling from the resident, at an appropriate price, in the sense of having committed to the satisfaction of the Tribunal to do so. We do not, however, think that this difference in wording is a sufficient reason to uphold the appeal on this ground. The Tribunal was correct to conclude that s 113(3A)(b) had been satisfied in the circumstances of these cases, provided the prices to be paid were in fact no less than the values of the dwellings as determined by the Tribunal under s 130A. To the extent that the Tribunal below erred in expressing its conclusion at [114] as it did, this did not lead to orders being made which should not have been made.
2. We have rejected the construction put forward by the residents. On the proper construction of s 113(3A)(b) and if the other grounds of appeal are not successful, the Tribunal was entitled to make the orders that it did.
3. In these circumstances and for the reasons set out above, we reject the appeal based on ground 2.
Ground 3
1. Ground 3 was formulated as follows: "The Tribunal erred in deciding that there is no practical difference between the requirements set out in s113(3A)(b) and (c)".
2. In response to this ground, the owner submitted "the Tribunal did not decide that 'there is no practical difference between the requirements set out in s113(3A)(b) and (c)'". The owner's submissions drew attention to [37] of the decision below, which states:
[37] The applicant further contends that the capacity for a resident to make an offer for sale of his or her dwelling is accommodated by s 113(3A)(c). Accordingly, an interpretation of s 113(3A)(b) which is contingent upon the resident making an offer should not be preferred as there would be very little, if any, practical difference between the requirements set out in s 113(3A)(b) and s 113(3A)(c).
1. At [37], the Tribunal below was summarising the owner's submissions as to the consequence of adopting the residents' submission. The Tribunal's conclusion on this issue is found at [113] to [114] (which have been quoted above). The Tribunal below rejected the residents' submission.
2. Notwithstanding the way in which ground 3 is formulated, as we understand it, this ground of appeal addresses in substance the same issue as ground 2, namely, whether the resident must have agreed to the sale in question in order for the Tribunal to be able to be satisfied that "the park owner has agreed to buy the dwelling from the resident … [at the appropriate price]", within s 113(3A)(b).
3. For the reasons we have already given in relation to ground 2, we are of the view that the Tribunal could be satisfied that the park owner had agreed to buy the dwelling from the resident at the appropriate price for the purposes of s 113(3A)(b) even if the resident had not agreed and did not agree to the sale, at that price or at all.
4. Accordingly, we dismiss the appeal based on ground 3.
Ground 4
1. Ground 4 was in the following terms:
"The Tribunal erred in deciding that the value of a dwelling excludes the bundle of rights attached to the residents dwelling under a residential site agreement (residential parks)."
1. In written submissions, the residents contended that the provisions constituting the "compensation regime for termination", including ss 113(3A)(b) and 130A of the Residential Parks Act, were legislative protections for the resident referred to in s 4A(b) and were remedial or beneficial in nature and should be liberally construed. As a consequence, it was argued "a valuation for sale under s 130A … should include the rights attached to the dwelling. Any other approach would amount to a fire sale of the residents dwelling, which would be inconsistent with the objects of the Act".
2. The residents conceded that the "location" of the dwellings was expressly excluded from the determination of value under s 130A by subs (4) of that section and that the value of the land upon which the dwelling was installed should also be excluded, because the residents did not own that land. They contended, however, that:
1. It was open to the Tribunal "to include the rights attached to the dwelling" in order to give effect to the "legislative purpose of the compensation provisions". What precisely were the "rights attached to the dwelling" was made clear when, in summary, the residents submitted "[t]he value of the dwelling must be as is, in situ, with its site agreement included". The rights arising from the site agreement were also said to include the rights identified by Beech-Jones J in [35] of his judgment in the proceedings in the Supreme Court.
2. "[L]ocation" in s 130A(4) referred to the particular location of the dwelling in the residential park, for example, whether it was near the water or near a busy highway. Thus, in determining value under s 130A the Tribunal should not take into account any premium because of a dwelling's particular location within the park but otherwise the fact that the dwelling was located in the park in question could be taken into account.
1. The respondent submitted that the Tribunal below was correct to adopt the approach that it did and this ground of appeal should be rejected.
2. As has been noted above, s 130A does not provide any express guidance on the principles to be applied in valuing the "dwelling" in question except that under s 130A(4) "[t]he Tribunal's determination [of value] may not have regard to the dwelling's location".
3. Thus, to the extent that the residents' contention that the value should be determined with the dwelling "as is, in situ" involves the value being determined having regard to its location, the submission must be rejected. If "as is" refers to the current state of repair of the dwelling, we accept that this is a factor which is relevant to the determination of the value of the dwelling under s 130A.
Rights related to the site agreement and paragraph [35] factors
1. It is important to bear in mind that s 130A empowers the Tribunal to determine the value of the "dwelling" and not any other rights which the resident may possess.
2. In particular, the Tribunal is not empowered under s 130A to determine the value to the resident of a residential site agreement, by virtue of which the resident was allowed to install the dwelling on the residential site. There is no basis in the text of s 130A to extend the subject of the determination of value beyond the "dwelling" to include the site agreement as well.
3. The Appeal Panel accepts that ss 113(3A) and 130A are provisions designed to protect residents and should be construed as beneficial and remedial legislation. This does not, however, permit us to go beyond what is reasonably open on the text of the provisions. In this regard, Mason, Brennan, Deane and Dawson JJ in the High Court in Khoury v Government Insurance Office of (NSW) (1984) 165 CLR 622; HCA 55 held at 638:
"the rule that remedial provisions are to be beneficially construed so as to provide the most complete remedy of the situation with which they are intended to deal must, as has been said, be restrained within the confines of "the actual language employed" and what is "fairly open" on the words used."
1. Accordingly, it appears to us that there are considerable difficulties in accepting the residents' submission that the value determined under s 130A should be of "the dwelling … with its site agreement included" because the actual language of the section is confined to the value of the "dwelling".
2. This more confined approach is consistent with the second reading speech which indicated that s 130A and s 113(3A)(b) were intended to operate where the owner had given a notice of termination for change of use, the site agreement was to be terminated but the dwelling was not to be relocated. In such situations, there would be no continuing site agreement that would be included with the dwelling to be valued under s 130A.
3. In addition, the mischief addressed by these sections was identified in the second reading speech as the circumstance "[w]hen residents find that their only option is to sell their home to the park owner but agreement cannot be reached on a fair price". In that situation is was said that "the tribunal will have the jurisdiction to break the deadlock and provide an independent valuation...". It is the "home" or "dwelling" that is to be valued, not the rights arising under the site agreement.
4. Furthermore, in the circumstances in which s 113(3A)(b) and s 130A were intended to apply, the park owner would not be acquiring from a resident any rights under a site agreement. Any rights the resident might have under such an agreement are rights which have been conferred by the park owner on the resident in the first place. The park owner does not need to re-acquire those rights as the residential site agreement has been, or is in the immediate future to be, terminated.
5. Accordingly, in our view, the Tribunal is empowered under s 130A to determine the value of the dwelling but not taking into the value of any residential site agreement under which the dwelling is or was entitled to be installed on the site in question. The Tribunal below did not take into account the value of any site agreement and did not fall into error.
6. The residents also raised under this ground of appeal the related failure of the Tribunal below, when making its determination, to take into account the rights or factors referred to in obiter dicta by Beech-Jones J in [35] of his reasons for judgment in Allen v TriCare (Hastings) Pty Ltd [2015] NSWSC 416. These were referred to during the hearing as the "paragraph 35 factors" and were, in summary, the right of quiet enjoyment, rights of alienation and the protections on defeasibility afforded by Pt 12 of the Residential Parks Act.
7. It can be noted that the owner attempted to appeal, in effect, against these comments by his Honour but the appeal was dismissed as incompetent since an appeal could only relevantly be from "a judgment or order of the Court in a Division" under s 101(1)(a) of the Supreme Court Act 1970 (NSW) and the obiter comments did not lead to an operative judicial act, see TriCare (Hastings) Limited v Allen [2015] NSWCA 344 at [9] to [12]. At [13], the Court of Appeal said:
"The true ambit of s 130A may ultimately be determined by the Tribunal on the remitter. Should it be inclined to consider adopting the primary judge's observations at [35], it should be conscious of the fact that these were obiter. Indeed, significant issues as to the correctness of the observations at [35] were raised in the course of argument in this Court."
1. On remitter, the Tribunal below held at [123]:
"Given the above circumstances I am not bound to follow His Honour and with respect I hold a different view. In my view the valuation of the resident's dwelling under S 130A(2) is a valuation of the dwelling without regard to the above rights (which are termed by the parties as the paragraph 35 factors). The fact that the section specifically excludes the dwellings location confirms, in my view, that the section requires the valuation to be of the dwellings as a as a building. This view is, in my opinion supported by the Second Reading Speech. The paragraph 35 factors are rights which pertain to the residential site agreements and not to the dwelling. In my view this approach is consistent with the approach required for fixing compensation under s 128(3), (4) and (5) which concern compensation to be paid when a dwelling is being located to a new site. The various categories of costs to be considered do not include factors like the paragraph 35 factors. There is also a cap on the amount of compensation, namely the value of the dwelling: s 128(5)."
1. We agree with that reasoning and conclusion. As has been noted above, the right of quiet enjoyment is a term of every residential tenancy agreement by operation of s 20 of the Residential Parks Act. In the case of a residential site agreement, however, the resident's right of quiet enjoyment arising under the statute relates only to the site. The dwelling that may be installed on the site is any dwelling that is already owned by the resident. Any dwelling owned by the resident is not the subject of the agreement except to the extent that the resident is permitted to install such a dwelling on the site. The right of quiet enjoyment of the dwelling derives from ownership of the dwelling. The right to quiet enjoyment of the site does not form part of the bundle of rights which should be taken into account when valuing any dwelling that the resident has installed on the site.
2. Similarly, the rights of alienation and passing of residency rights conferred by ss 41 and 43 of the Residential Parks Act, in the case of a residential site agreement, relate only to the agreement and the rights and obligations created under it. Rights to sell or otherwise pass title to the dwelling installed on the site at any particular time arise from the resident's ownership of the dwelling, not from the site agreement. Any such rights of alienation or similar rights in relation to the dwelling itself are taken into account when determining the value of the dwelling as goods. Those rights, to the extent that they arise because of the site agreement, do not attach to the dwelling and should not be taken into account when determining the value of only the dwelling as required by s 130A.
3. It is not clear what the protections on defeasibility afforded by Pt 12 Beech-Jones J was referring to in [35] of his reasons. To the extent that they are the protections afforded by the requirement to give notice of termination under s 102, the limitations on the Tribunal's power to make orders under s 113 and the requirement to make compensation available to residents as a result of the operation of s 113(3A)(b), s 128 and s 130A, it does not appear to us that these could legitimately be found to affect the value of the dwelling as opposed to the value of the residential site agreement, before it was terminated.
Location and premium
1. As to the submission that the reference to "location" in s 130A(4) was only a reference to the particular location of the dwelling within the park and thus only required the Tribunal not to take into account any premium resulting from that location, the Appeal Panel does not accept that submission. In our view, the exclusion of "location" from the valuation process reflects the fact that what is being valued is the "dwelling", not the residential site or any value associated with any particular location of the dwelling, whether within the park in question or at all. The "dwelling" to be valued under s 130A will necessarily be goods not land. This is inherent in their nature as relocatable homes or moveable dwellings. Goods such as these, when considered separately from the site on which they are installed and the site agreement under which they are so installed, do not have any inherent location. The fact that the dwelling was located in the park in question should not, therefore, be taken into account.
2. Consequently, in our view, when determining the values of "dwellings" for the purposes of s 130A, the Tribunal should not take into account any aspect of the actual location of the dwelling but should only value it as moveable goods. This is the approach that the Tribunal at first instance adopted and it was correct to do so.
Summary and conclusion on ground 4
1. In summary, on the proper construction of s 130A, the Tribunal is empowered to determine the value of the dwelling in question in its current state of repair, without regard to its location in any sense and not taking into account any site agreement which might permit it to be installed on a particular site or any of the factors identified in [35] of the reasons in Allen v TriCare (Hastings) Pty Ltd [2015] NSWSC 416. This is the approach adopted by the Tribunal at first instance and there was no error in its doing so.
2. Consequently, we would dismiss the appeal based on ground 4.
Grounds 6 and 7
1. The original ground 5 was deleted in the amended grounds of appeal and replaced with grounds 6 and 7. Both grounds 6 and 7 concern the report of the registered valuer, Mr Hoolihan, and his opinions as to the value of each of the dwellings in question. It is appropriate to consider these grounds together. They involve the contentions that the valuer's report was shown, during cross examination, to have been so flawed that it provided no foundation for the opinions expressed and thus it was not open to the Tribunal below to attribute weight to the report (ground 6) or to rely on the opinions expressed in it (ground 7).
2. The flaws in the valuer's report and opinion were set out at par 47 of the residents' written submissions as follows:
"a. His report was based on a number of documents not referred to or included in his report;
b. He does not set out his methodology for reaching his various valuations in the report.
c. His report fails to set out the assumptions underlying each basis of valuation.
d. His report fails to set out a number of limitations to his report.
e. His report was based on verbal information given to him by third parties. Neither the information given nor the identity of the third parties is contained within the report.
f. The comparable sales he uses as the starting point of his valuations were provided to him by a third person and the details of that exchange are not in his report.
g. He had limited information on the comparable sales and did not have information on the size of the dwellings, the condition of the dwellings and he did know whether they were dwellings with permanent site agreements.
h. He was unable to find a solitary comparable for dwellings sold off site.
i. He applied an arbitrary figure to determine the monetary value of the statutory rights contained within a site agreement. When asked how he arrived at that sum he conceded there was 'no basis' for doing so.
j. When asked to explain how he reached his conclusion that the dwellings were in fact worth less in the park than 'on stumps' off site he said he based it what he would prefer to purchase himself.
k. He was unable to support his conclusion as to a 'comparable park'
L. He struggled with the orders"
1. It was also put in the residents' written submissions (at par 48) that:
"Given the above [the flaws exposed in cross examination listed in par 47], the acceptance of Mr Hoolihan, as an expert, whose report and findings could be relied upon, cannot be supported. That finding was so unreasonable as to amount to an error of law."
1. The residents did not seek leave under s 80(2)(b) of the NCAT Act to appeal in respect of this ground. Accordingly, the only basis of appeal available to them is an appeal on a question of law. The residents' position, as developed by the residents in their oral and written submissions and expressly confirmed by their counsel during the hearing, was that the questions of law that arise under grounds 6 and 7 may be formulated as follows:
1. Was the valuer's report so flawed that there was, in effect, no evidence that could support the findings of the Tribunal below that the valuer's evidence should be accepted and that the values of the various properties should be determined accordingly? – the No Evidence Ground; and
2. Were the Tribunal's acceptance of the valuer's evidence and its determination of values based on that evidence so unreasonable that no reasonable decision maker could have done so? – the Unreasonableness Ground.
1. During the hearing, both counsel for the residents and counsel for the owner expressly accepted this formulation of the substance of these grounds of appeal and it was the basis upon which the appeals were conducted. Consequently the owner did not press any submissions concerning whether leave to appeal was required or should be granted in relation to grounds 6 and 7.
2. The No Evidence Ground raises a question of law, having regard to what Hayne, Heydon, Crennan and Kiefel JJ said in Kostas v HIA Insurance Services Pty Ltd (2010) 241 CLR 390; [2010] HCA 32 at [91]:
"… Whether there was no evidence to support a factual finding is a question of law, not a question of fact. The Tribunal's factual finding in this case, that the builder had served the two relevant claims for extension of time, necessarily depended upon its first accepting that there was evidence to support the finding. As Dixon CJ said in Gurnett v The Macquarie Stevedoring Co Pty Ltd [No 2]:
'in the legal dichotomy between questions of fact and questions of law we place under the latter head a question whether there is sufficient evidence to submit to a jury in support of a cause of action. That is because it is a question for the court to decide and not for a tribunal of fact.'
A tribunal that decides a question of fact when there is "no evidence" in support of the finding makes an error of law. What amounts to material that could support a factual finding is ultimately a question for judicial decision. It is a question of law. And in this case, for the reasons given by the primary judge, there was no evidence before the Tribunal, when it decided the separate question identified by the parties, upon which the Tribunal could find that the disputed notices had been served." (footnotes omitted)
1. The second ground, the Unreasonableness Ground, also raises a question of law. In Duncan v Independent Commission Against Corruption [2016] NSWCA 143, Bathurst CJ explained the applicable principles as follows (at [278]):
"In Bond [(1990) 170 CLR 321; [1990] HCA 33], Mason CJ stated that, at common law, so long as a particular inference is reasonably open, even if reached as a result of illogical reasons, there is no place for judicial review because no error of law has taken place: at 356. However, it does seem clear that findings or inferences of fact can be challenged if the decision was irrational or illogical and not based on findings or inferences of fact supported by logical grounds. In Peko-Wallsend [(1986) 162 CLR 24; [1986] HCA 40], Mason J, as his Honour then was, stated that this ground of review would only be made out if the decision was so unreasonable that no reasonable person could have come to it: at 41, citing Associated Picture Houses Ltd v Wednesbury Corporation (1948) 1 KB 23 …"
1. In response to these grounds, the owners submitted that the valuer was qualified and possessed appropriate expertise, his report adequately complied with the applicable procedural direction concerning expert evidence and his opinions were supported by his reasoning and the information he supplied. It was submitted that the Tribunal was not bound by the rules of evidence and it was a matter for the Tribunal what weight it gave to the valuer's evidence. The conclusions for which the owner contended were that:
1. there was no error of law by the Tribunal below in deciding to accept the valuer's opinions as to the values of the dwellings since there was sufficient evidence to support those opinions;
2. there was no error because the Tribunal's decision to give weight to the report and accept its conclusions was not so unreasonable that no reasonable decision maker could have so decided.
The Appeal Panel's approach to these grounds of appeal
1. We shall deal with the issues raised by these grounds of appeal by reference to the topics listed in par 47 of the residents' submission (which we have quoted above). Before doing so, however, we shall make some general comments concerning expert evidence in the Tribunal.
Expert Evidence Generally
1. As has been explained above, by operation of cl 7(3)(b) of Sch 1 to the NCAT Act, the provisions of the CTTT Act continued to apply in respect of the proceedings at first instance. Relevantly for present purposes, s 28(2) and (3) of the CTTT Act provided:
"(2) The Tribunal is not bound by the rules of evidence and may inquire into and inform itself on any matter in such manner as it thinks fit, subject to the rules of procedural fairness.
(3) The Tribunal is to act with as little formality as the circumstances of the case permit and according to equity, good conscience and the substantial merits of the case without regard to technicalities or legal forms."
1. Sections 28(2) and (3) of the CTTT Act are in almost identical terms to ss 38(2) and (4) of the NCAT Act, respectively. The only difference is that the NCAT Act in s 38(2) refers to the "rules of natural justice" rather than "the rules of procedural fairness". It should also be noted that whilst s 28(2) in the CTTT Act is unqualified, the same is not true for the NCAT Act. The rules of evidence do apply in NCAT in a number of circumstances, but not in the type of proceedings that were before the Tribunal at first instance.
2. When s 28(2) of the CTTT Act and s 38(2) of the NCAT Act refer to the "rules of evidence" this includes both the Evidence Act 1995 (NSW) and the common law principles of evidence.
3. In Hancock v East Coast Timber Products Pty Limited [2011] NSWCA 11, the Court of Appeal explained the approach that should be taken to expert evidence by a decision making body that is not bound by the rules of evidence. That case concerned the Workers Compensation Commission, which operates under provisions which were very similar, but not identical, to s 28(2) and (3) of the CTTT Act and s 38(2) and (4) of the NCAT Act. The Court of Appeal held, in Hancock at [82] and [83]:
82. Although not bound by the rules of evidence, there can be no doubt that the Commission is required to be satisfied that expert evidence provides a satisfactory basis upon which the Commission can make its findings. For that reason, an expert's report will need to conform, in a sufficiently satisfactory way, with the usual requirements for expert evidence. As the authorities make plain, even in evidence-based jurisdictions, that does not require strict compliance with each and every feature referred to by Heydon JA in Makita to be set out in each and every report . In many cases, certain aspects to which his Honour referred will not be in dispute. A report ought not be rejected for that reason alone.
83. In the case of a non-evidence-based jurisdiction such as here, the question of the acceptability of expert evidence will not be one of admissibility but of weight. This was made apparent in Brambles Industries Limited v Bell [2010] NSWCA 162 at [19] per Hodgson JA. That is the way that Keating DCJ dealt with Dr Summersell's evidence in this case, so that is not the relevant error.
1. This reasoning and approach should be applied to proceedings in this Tribunal, when the rules of evidence do not apply, and to proceedings conducted under the CTTT Act. In these situations, the question of the acceptability of expert evidence in the Tribunal will be one of weight not admissibility. In addition, the Tribunal is required to be satisfied that expert evidence provides a satisfactory basis upon which it can make its findings.
2. The requirement that the expert evidence provides a satisfactory basis for the making of findings by the Tribunal is reflected in:
1. the Tribunal's procedural direction dealing with expert evidence, issued in February 2014 by the President under s 26 of the NCAT Act, NCAT Procedural Direction 3 – Expert Evidence, which the valuer expressly agreed to be bound by on p 2 of his report; and
2. the CTTT's Chairperson's Direction CTTT CD2003-2 given under s 12(4) of the CTTT Act, which applied in the CTTT prior to the formation of NCAT.
1. NCAT Procedural Direction 3 contains in pars 10 to 21 an Experts' Code of Conduct. Paragraphs 16 to 18 of the Code deal with the content of expert reports and related matters. They provide:
"16. An expert's report must (in the body of the report or in an annexure to it) include the following:
(a) the expert's qualifications as an expert on the issue the subject of the report;
(b) the facts, and assumptions of fact, on which the opinions in the report are based (a letter of instructions may be annexed);
(c) the expert's reasons for each opinion expressed;
(d) if applicable, that a particular issue falls outside the expert's field of expertise;
(e) any literature or other materials used in support of the opinions;
(f) any examinations, tests or other investigations on which the expert has relied, including details of the qualifications of the person who carried them out;
(g) in the case of a report that is lengthy or complex, a brief summary of the report (to be located at the beginning of the report);
(h) an acknowledgement that the expert has read the experts' code of conduct and agrees to be bound by it.
17. If an expert witness who prepares an expert's report believes that it may be incomplete or inaccurate without some qualification, the qualification must be stated in the report.
18. If an expert witness considers that his or her opinion is not a concluded opinion because of insufficient research or insufficient data or for any other reason, this must be stated when the opinion is expressed."
1. The CTTT Direction contains very similar provisions in pars 3.1 to 3.3 which provide
"3.1 A report by an expert witness must (in the body of the report or in an annexure to it) specify:
(a) the person's qualifications as an expert;
(b) the field of expertise in which they are giving evidence;
(c) a statement of what the expert witness was asked to report about;
(d) the facts, matters and assumptions on which the opinions in the report are based (a letter of instructions may be annexed);
(e) reasons for each opinion expressed;
(f) if applicable - that a particular question falls outside his or her field of expertise;
(g) any literature or other materials utilised in support of the opinions; and
(h) any examinations, tests or other investigations, on which he or she has relied and identify, and give details of the qualifications of, the person who, carried them out.
3.2 If an expert witness who prepares a report believes that it may be incomplete or inaccurate without some qualification, that qualification must be stated in the report.
3.3 If an expert witness considers that his or her opinion is not a concluded opinion because of insufficient research or insufficient data or for any other reason, this must be stated when the opinion is expressed."
1. Since the valuer agreed to be bound by the NCAT Procedural Direction we shall refer to that document where relevant and it is not materially different from the CTTT Direction.
2. We now turn to consider the specific issues raised by the residents in these appeals using their descriptions of the flaws found in par 47 of their written submissions.
His report was based on a number of documents not referred to or included in his report.
1. The residents' contended that the valuer's report was flawed because it was based on a number of documents but these were not referred to or included in the report.
2. For the purposes of his report, the valuer had identified 13 sales of moveable dwellings which were described by him (at p 3) as "the most recent and relevant information available" and details of those sales was set out at pp 11 – 14).
3. In cross-examination, the valuer said that he had available to him additional material concerning the 13 sales upon which he relied and that he had drawn upon that material in preparing his report. (The references to pages in the transcript of the hearing on 29 February 2016 are given using "T[page number. point on the page]:T15.3- .4, 21.2-.4, 22.1 and 23.2 and 23.9). This material included a spreadsheet containing a larger number of sales from which the 13 comparable sales were selected, brochures relating to those 13 sales and photographs of the dwellings that were sold. This material was not attached to or included in his report. The residents submitted, in substance, that this totally undermined the reliability of the report.
4. In our view, the failure to refer to this material in, or attach it to, the report does not so undermine the reliability of the report that it should carry no weight or that it would be unreasonable to rely upon it. The valuer provided a summary of relevant details of the 13 sales which he considered to be the most recent and relevant evidence available at pp 11 – 14 of the report under the heading "Sales Evidence". The summary information had been drawn from the spreadsheet, the brochures and the photographs (T24.2). The summary contained, in respect of each of the sales: identification and a description of the residential park in which the dwelling was located, the site number, the date of the sale, the sale price and a description of the dwelling. By way of example, the valuer's description of the first of the 13 sales was:
"A single level, modern style, vinyl clade, 2 bedroom, 1 bathroom, fully renovated manufactured home which features 'L' shaped 'retreat' room."
1. A valuer using a 'direct comparison' approach to valuation based on recent market evidence necessarily has to rely upon sales data which is, very often, obtained from others. The valuer in this case obtained the data and supporting material from an agent who specialised in moveable dwellings. The valuer then summarised the information in his report. The Court of Appeal in Hancock v East Coast Timber Products Pty Limited [2011] NSWCA 11 observed at [69]:
"…in Paino v Paino [2008] NSWCA 276; (2008) 40 Fam LR 96, Hodgson and McColl JJA noted, at [66], that it is inherent in the process of preparing many expert reports that the factual basis for the opinion expressed is derived from third party information. Their Honours pointed out that what the courts require is that the factual bases of opinions be clearly laid out so that the opinion of the expert may be properly tested. See also Sydneywide Distributors Pty Ltd v Red Bull Australia Pty Limited [2002] FCAFC 157; (2002) 55 IPR 354; Adler & Anor v ASIC [2003] NSWCA 131; (2003) 46 ACSR 504."
1. As the Court of Appeal indicates, the purpose of requiring the factual basis to be disclosed in an expert's report is to allow the opinions expressed by the expert to be properly tested. In our view, this summary information provided under the heading "Sales Evidence" adequately served the purpose of disclosing the facts in relation to the sales on which the valuer based his opinion so that the residents could test how the expert's opinions was based on that information. This testing is precisely what occurred in cross examination in the present case. What the valuer did in the present case was also sufficient to comply with par 16(b), (c) and (e) of NCAT Procedural Direction 3.
2. Section 28(2) of the CTTT Act (as well as s 38(2) of the NCAT Act) includes the warning that, although the rules of evidence might not apply, the Tribunal must still ensure that procedural fairness is accorded to the parties in relation to evidentiary matters. In the present case, the 13 sales relied upon were disclosed with some particularity. As a result, the residents were informed of the particular aspects of the sales upon which the valuer relied. They could have sought to obtain any supporting material, for example by way of a summons issued under s 48 of the NCAT Act or s 40 of the CTTT Act, if they wanted to test the accuracy and completeness of the valuer's sales data. As it happened, the supporting material was available to the residents' counsel at the hearing and she cross-examined the valuer on it. In these circumstances, it can be seen that the information contained in the valuer's report concerning the most relevant and recent sales data was sufficient to ensure that there was no denial of procedural fairness to the residents.
3. Finally, it should be observed that no submission was made that the valuer's summary of information was incorrect or not in accordance with the supporting material.
4. Taking all of these matters into account, in our view the Tribunal below was not required to give the valuer's report no weight because there was in effect no evidence to support the opinions expressed. The Tribunal was entitled to find that the valuer's opinion should be not be rejected even though the report was based on a number of documents not referred to or included in the report. It could not be said that no reasonable decision maker would have accepted the report because of the failure to disclose or attach the supporting relied upon which the "Sales Evidence" was based.
He does not set out his methodology for reaching his various valuations in the report.
1. Paragraph (c) of the NCAT Procedural Direction 3 requires the expert to state his or her reasons for each opinion expressed. In the case of a valuer, this would include a statement of the valuation methodology used.
2. The residents contended that the valuer did not set out his methodology for reaching his various opinions as to the value of each of the dwellings. We reject this contention.
3. The valuation methodology employed by the valuer was described, at a general level, on p 3 of his report in the following terms:
"I have used a 'direct comparison' approach to valuation using recent market evidence to compare to the subject 'Hastings Point sites' to those sales comparisons. I have used sales within surrounding localities within established Manufactured Homes Parks and the sales within this report are considered to be the most recent and relevant information available".
1. On p 4 of his report, the valuer stated that the valuations represented "Market Value", which he there defined in terms generally consistent with Spencer v The Commonwealth (1907) 5 CLR 418 at 432 and 441.
2. On p 4, the valuer also stated in relation to his methodology, in the broader sense, that the valuations were carried out in accordance with the directions of the Tribunal. As can be seen from those directions (parts of which are set out earlier in these reasons as well as on pp 4 and 5 of the valuer's report), the Tribunal required the dwellings to be valued on a number of alternate bases reflecting the parties' differing contentions as to the approach to valuation required by s 130A. This was done so that the Tribunal at first instance would have relevant valuations available to it and the matters could be determined expeditiously and efficiently.
3. In summary, the various bases of valuation on which the valuer gave his opinions were, in accordance with order 7(a) of the directions, as follows (see pp 4, 5, 15, 16 and 17 of the report):
Basis Relevance of Location
Basis 1 No regard to dwelling's location
Basis 2 No regard to any premium attaching to the particular dwelling's location but having regard to it being located in the particular park
Basis 3 Having regard to the dwelling being located in a comparable park
1. Within each basis, there were 2 further sub-bases of valuation:
1. in accordance with order 7(b), the valuations on each of Bases 1, 2 and 3 were to be carried out having regard to:
1. The value of each dwelling in its current state of repair; and
2. The value of each dwelling in a reasonable state of repair;
1. in accordance with order 6(a) and (b), the valuations on each of Bases 1, 2 and 3 were to be carried out:
1. taking into account; and
2. not taking into account,
the "paragraph 35 factors", being the factors identified by Beech-Jones J in Allen v TriCare (Hastings) Pty Ltd [2015] NSWSC 416 at [35]. (These factors have been referred to earlier in these reasons.).
1. On p 20 of his report, the valuer then explained how he initially assessed the values in accordance with Basis 3 and then how he derived his Basis 1 and Basis 2 valuations from the Basis 3 valuation by making adjustment taking into account or not taking into account the various factors referred to in the Tribunal's directions. His conclusions as to each basis and sub-basis of valuation were then set out for each dwelling in the tables on pp 15, 16 and 17.
2. It is true that the valuer does not give any explanation in his report why he attributed values of $20,000, $15,000 or $10,000 to the [35] factors (as revealed for example in the tables on pp 15 and 17) or why he deducted $25,000, $20,000, $10,000, $5,000 or $0 when excluding location from the consideration of value (as revealed for example in the tables on pp 15 and 17). Nonetheless, the fact that he did so and what factors they were related to are disclosed by his figures and tables. The residents were sufficiently informed of the reasons for his opinions that their counsel was able to test these matters in cross-examination.
3. Having regard to all of these matters, the Tribunal was not precluded from giving weight to the valuer's report or reasonably accepting its conclusions on the basis that his methodology was not adequately set out in his report.
His report fails to set out the assumptions underlying each basis of valuation.
1. NCAT Procedural Direction 3 states at par 16(b) that an expert's report must include "the facts, and assumptions of fact, on which the opinions in the report are based (a letter of instructions may be annexed)".
2. The residents submitted that the valuer failed to set out in his report assumptions as to the various bases of valuation. The assumptions which the residents relied upon in this regard were identified in their oral submissions as:
1. assumptions as to the paragraph 35 factors referred to in order 6(a) and (b) of the Tribunal's directions;
2. assumptions as to the meaning "location" in order 7(a)(i);
3. assumptions as to the meaning of "premium" in order 7(a)(ii);
4. assumptions as to meaning of in a "comparable park" in order 7(a)(iii).
1. All of these assumptions that the residents contended should have been included in the valuer's report relate to the bases of valuation which the valuer was required to address as a result of the directions made by the Tribunal on 13 January 2016.
2. In each case the valuer conceded in cross examination that he did not set out in his report what he understood the Tribunal to have meant by the expressions it had used. The valuer's evidence was to the effect that he had done what he understood was required by the Tribunal's directions rather than making assumptions. For example, the following passage (T 45.7 – 46.3) illustrates what was said in cross-examination:
"MM [The residents' counsel]: So I take you to the second basis of the valuation: no regard is had to any premium attached to the particular dwelling's location but having regard to its being located in the particular park. First of all, I want to ask you what, if any, assumption did you place upon the term "premium"? What did you understand that to mean?
AH [The valuer] There was no regard to be had to any premium.
MM: What did you understand by the term "premium"?
AH: In this particular order, I took it as the location to the water.
MM: You haven't set that out, have you, in your report, that that's the assumption?
AH: No. I – again, if I can just say, as per order 7 of the NCAT, I just followed the – for the purpose of the valuations.
MM: Yes.
AH: Yeah.
MM: But surely –
AH: I followed the orders rather than making assumptions."
1. The valuer was required to carry out valuations on multiple bases as set out in the Tribunal's directions, which we have summarised above. He disclosed, in his report, his opinion as to the valuation of each dwelling on each of the required bases and sub-bases.
2. The Tribunal used ordinary English words to describe the bases and sub-bases, except for the "paragraph 35 factors". In our view, the valuer's understanding of the ordinary English words such as: "dwelling's location"; "the particular park"; "a comparable park", as used in order 7(a)(i), (ii) and (iii), is not relevantly an assumption of fact which would have to be proved, if the rules of evidence applied. It is not, therefore, something that the valuer must disclose in his report under the Experts' Code of Conduct.
3. The expression "paragraph 35 factors" is somewhat different in that this refers to a particular set of factors identified by Beech-Jones J in [35] of his decision. Nonetheless, the valuer explicitly disclosed that he was required to consider the valuations of the dwellings with and without those factors, he provided his valuations clearly identifying which were with and without the "paragraph 35 factors" on pp 15, 16 and 17 and he set out what those factors were in full on p 5 of his report, quoting order 4 of the Tribunal's directions. These were not assumptions of fact, in the sense described above, made by the valuer. His understanding of the expression "paragraph 35 factors" was not something he was required to disclose in his report as an assumption of fact.
4. A relevant purpose of requiring assumptions of fact to be disclosed is so that the opposing party is properly informed of the basis for the expert's opinions and can test those opinions and how they were derived. Having described the various bases and sub-bases and disclosed, in his report, his opinion of what the value of each dwelling on each basis and sub-basis was, the valuer in the present case had relevantly done what was required to inform the other side of his opinions and the basis or sub-basis upon which they were determined. The valuer was able to be cross-examined on his understanding of the words in question and how he had formed his opinions as to value based on that understanding. Thus, the residents had the ability and opportunity to test the valuer's reasons for his opinions.
5. Consequently, it does not appear to us that there was any relevant flaw in the valuer's report because he did not set out, as assumptions, his understanding of what the Tribunal meant by the words used in its directions to describe the various bases and sub-bases of valuation.
6. In our view, the Tribunal below, by giving weight to the valuer's report or accepting its conclusions, did not err because the report did not set out, as assumptions, the valuer's understanding of the meaning of the words used by the Tribunal in describing the various bases and sub-bases of the valuations.
His report fails to set out a number of limitations to his report.
1. The residents raised during cross examination a number of areas where the valuer lacked information relating to each of the 13 recent sales relied upon by the valuer. The information that was conceded to be lacking included details such as the terms of any residential site agreement (T22.3, 23.4), the precise condition of the dwellings when sold, because the valuer had not inspected them at that time (T22.7, 23.7), the square meterage of the dwellings (T24.3 - .5, 27.6- .7) and the precise age of the dwellings (T27.8-.9). Other areas where information or data was lacking were identified in the residents' submissions under other headings, which we address below.
2. Whilst the information available to the valuer was limited, as he conceded, it does not follow from this that the report was so unreliable that it could not be given any weight or that it would be unreasonable to accept it.
3. Notwithstanding that certain relevant information was not available to him, the valuer did have the information recorded in his report concerning each of the 13 sales. There was also the information in the spreadsheet of sales, and the relevant brochures and photographs. The valuer explained that while he did not know the exact age of the dwelling he could form a view as to the general period or era when the dwelling was manufactured which would indicate its age. Further, although he had not seen inside the dwellings or determined their precise size, he did have the photographs and the brochures and had walked past some of them. While limited in some ways, the information provided, in our view, sufficient support for the opinions expressed.
4. It would not normally be expected that a valuer valuing property comprising land and the house built on the land would have inspected, at the time of sale, each of the houses which were included in the valuer's comparable sales. Nor would the valuer usually have available the precise terms of the contract for sale, other relevant contractual arrangements affecting the property or precise information concerning the exact age or dimensions of the house beyond what was available by way of brochures or photographs.
5. To require detailed and precise information such as this to be obtained and provided before any expert's report could be relied upon would set an impractically high standard that could significantly inhibit the Tribunal's ability to receive and rely on expert evidence to resolve the many disputes that come before it.
6. Further, the valuer disclosed sufficient information to allow the residents' counsel to cross-examine fully on all of these matters and test the valuer's reasoning and conclusion. This being so, it does not appear to us that the valuer was required to state what information he did not have available to him. Nor should a failure to do so lead to the conclusion that the report was defective and could not be accepted or that it was unreasonable for the Tribunal below to make findings based upon the report.
7. Accordingly, we reject the submission that the limitations on the information available to the valuer and the fact that the limitations were not disclosed in the report should lead to the conclusion that the Tribunal erred by giving weight to the report and making findings based upon the valuer's opinions.
His report was based on verbal information given to him by third parties. Neither the information given nor the identity of the third parties is contained within the report.
1. The residents drew attention to the fact that, in the cross examination, the valuer gave evidence that he had:
1. made some enquiries of the owner of a park known as North Star Holiday Resort at Hasting Point and spoke to Mr Beedle and "the site girls" and discussed "some recent transactions"; (T28.4-.6, T37.8 - );
2. gone to a depot in Tweed Heads where a business was undertaken selling "vans and homes in a sort of depot-type scenario … sitting on stumps … [a]ll second hand" and made enquiries of the owner (T30.4-.9).
1. In both cases, nothing was included in his report concerning these enquiries.
2. From his answers in cross-examination, however, it appears that the valuer was not able to obtain any relevant details of transactions from these two sources. It was not put to the valuer that these answers were incorrect.
3. Consequently, in our opinion, it is not surprising that these enquiries and conversations were not referred to in the valuer's report. In these circumstances, it could not be concluded that the Tribunal below fell into error by giving weight to the report or by accepting the valuer's opinions because these enquiries and conversations had not been disclosed in the report.
4. In this regard, the residents also relied upon a conversation concerning the park known as Drifters, now called Active Holiday. The valuer was cross-examined concerning whether the Drifters park was flood prone and thus not comparable to Hastings Point Holiday Park. In his answers, the valuer disclosed that he had spoken to the site manager of Drifters who understood that "a lot of the sites, or the homes, are above [inaudible] flood area" (T37.5-.6). This was not referred to in his report. However, the cross-examination also established that the valuer did not know whether the Hastings Point Holiday Park was flood prone and there was no other evidence as to whether it was or not.
5. Having regard to the fact that it was not established that either the Hastings Point Holiday Park or the Drifters park was or was not flood prone to any significant extent or at all, we do not believe that the failure to disclose this conversation between the valuer and the site manager of the Drifters in his report has any significance. The failure to disclose it would certainly not justify a conclusion that no reasonable Tribunal could have accepted the valuer's report and opinions or that the report provided no effective evidentiary support for the Tribunal's conclusions as to the values of the dwellings.
The comparable sales he uses as the starting point of his valuations were provided to him by a third person and the details of that exchange are not in his report.
1. The valuer accepted that he had derived his 13 most recent and most relevant sales from a spreadsheet kept by a Mr Price. He initially obtained this information at a meeting with Mr Price and Mr Rutledge (T20.- 21). Mr Rutledge had been the valuer retained by the residents previously and was, at one point, proposed as the valuer who would give evidence for the residents at hearing of these matters before Deputy President Westgarth. Mr Rutledge did not, as it happened, provide a report or give evidence.
2. The valuer gave evidence that Mr Price was the "pre-eminent guy on the Tweed coast that does them [referring as we understand it to sales of moveable dwellings] … and … Jeremy [Rutledge] and I did agree that Mr Price was the best source of information for these transactions." (T28.9).
3. His evidence also described how the spreadsheet Mr Price gave to the valuer and Mr Rutledge contained more than 13 sales but the two valuers agreed that the 13 sales the valuer includes in his report were the most relevant to Hastings Point (T21.2 - .7). In addition, the valuer obtained photographs and brochures concerning those 13 sales from Mr Price (T29.9).
4. It was not put to the witness that any of this information, including the sales data, was incorrect and it was not submitted to us that it was not reliable.
5. In Paino v Paino [2008] NSWCA 276; (2008) 40 Fam LR 96, Hodgson and McColl JJA noted at [66]:
"It is inherent in the process of preparing many expert reports that the factual basis for the opinion expressed is derived from third-party information. Courts emphasise the necessity that the factual bases of opinions be clearly laid out so that the opinion can be tested. An expert is rarely the source of all the factual information in his or her report. It may be garnered from a party (the typical illustration being a medical report), from empirical investigations (engineering reports for example) or, in the case of valuations, from data relating to the properties about whose value an opinion is to be expressed."
1. There is nothing inherently flawed in the valuer in these cases relying upon sales data derived from a third party. A valuer will often have to rely on data from transactions in which the valuer was not directly or indirectly involved. The problem of availability of relevant sales information for a valuer seeking to value moveable dwellings was described in unchallenged evidence by the valuer in cross examination in these proceedings. He said (at T28.5):
"the problem with these sales transactions is they don't occur on a registered government database like your normal homes do, and units, … so there is no actual register for these transactions".
1. In our view, the sales information was sufficiently disclosed so that the factual bases of the opinions was laid out and the opinions could be tested, as they were in cross-examination in these matters. In these circumstances, it was not necessary for the valuer's report to disclose the conversations between Mr Price and the valuer.
2. The fact that the sales data used by the valuer as the starting point of his analysis was provided to him by a third person and the details of that exchange were not in his report do not provide any sound basis in these cases for concluding that the report provided no effective support for the Tribunal's conclusions as to the values of the dwellings or that no reasonable Tribunal could have accepted the valuer's report and opinions.
He had limited information on the comparable sales and did not have information on the size of the dwellings, the condition of the dwellings and he did know whether they were dwellings with permanent site agreements.
1. We have already dealt with the paucity of information concerning the 13 sales upon which the valuer relied to provide the basis for his valuations of the dwellings on Basis 3. We noted that although the valuer did not have precise information concerning the condition, size, age or contractual arrangements, he did have general information from the brochures and photographs that had been made available to him.
2. That the information as disclosed in the report was sufficient to allow the residents to test the valuer's opinions is supported in this case by the fact that the valuer was able to be vigorously cross-examined in some detail concerning how he arrived at his Basis 3 values. He was challenged on the comparability of the sales having regard, for example, to accommodation, size, age and condition. During the cross-examination, the valuer did make some concessions that in certain respects, for example accommodation, a dwelling that he said was comparable was superior to the comparator. In addition, it was acknowledged that it would have been important to set out the meterage of the various dwellings in the 13 sales being relied upon but the valuer did not have this information (T27.6 - .8).
3. Nonetheless, when asked whether, in the light of the questioning concerning comparisons of size, square meterage and number of bedrooms, he would amend his "numbers", referring to his opinions as to the values of the dwellings on each of the bases and sub-bases, the valuer answered that the only changes he would make would be to correct two typographical errors, which are not relevant for present purposes (T99.6 - .9).
4. This ground of complaint concerning the valuer's report developed in oral submissions into an argument that the valuer's comparable sales analysis, as exposed in cross-examination, was so defective that it provided no reliable foundation for the opinions expressed by the valuer.
5. We accept that if it was not open to find that the sales relied upon by the valuer were in fact comparable, then, to the extent his report was based upon their being comparable, the opinions expressed in the report would be without evidentiary foundation and it would be unreasonable to give weight to the report. Comparability is, however, a matter of degree and judgment.
6. In Sydney Water Corporation v Marrickville Council [2014] NSWCA 438 Leeming JA held at [30] and [33]:
"30. Whether or not a sale is comparable is a matter of degree and judgment. It may be accepted that there can be error of law if the finding that a sale is or is not comparable was not reasonably possible or open on the evidence, or in making an adjustment which is not reasonably possible or open on the evidence. A line of consistent authority, collected in this Court's reasons in ISPT Pty Ltd v Valuer General [2009] NSWCA 31; 165 LGERA 25 at [23]-[25] supports those propositions.
…
33. Both in identifying what is comparable, and in making appropriate adjustments, the position was described by Wells J in Brewarrana Pty Ltd v Commissioner of Highways (1973) 32 LGRA 170 at 180:
'... there is no hard and fast rule by the application of which a valuer may, whatever the circumstances, draw the line that clearly separates the sales that are comparable from those that are not. It is in my view, all a matter of degree: ... Just where the line is to be drawn is, it seems to me, the very sort of question that is fit for the expert valuer to determine; the assessment of the risks of adjustment is peculiarly within his sphere of skill.'"
1. To take a specific example concerning site 54 from these proceedings, the cross-examination included the following at (T75.3 – 76.9):
"AH: Well, you can have a – an – okay, I agree it's two bedrooms and the bunk room, call it 3, and the sale is one. But the condition of this particular home, being original, nothing's happened to it, it's 1983, it's got very low ceiling height. I make the statement there that the home would not be able to be moved to another particular site, it is a very hold home, it's a caravan with a rigid annexe. It is the least of the five, and I think the sales evidence support that with – and in particular – sorry, those sales 3 and 4, that are in the Hasting – in the Drifters park.
MM: Sir, you have agreed with me that sales 3 and 4 – let me rephrase that. You have agreed with me that 54, 58, 59 are superior in one way or another than sale 3 and 4, that is your evidence before this Tribunal.
AH: Agree.
MM: Right. And when you say superior, you would have taken in reaching that conclusion all of the factors you now talk about: condition, style, rooms, ceilings. And we also heard from you that you did not see inside sales 3 or 4, you don't know what the ceilings' heights are, you don't know the sizes and all the rest of it. Let's even say that they are directly comparable, as you have put out. If they are directly comparable even, you have not explained why on that basis you have valued site 54 to be 20,000 less at least. Your valuations do not make sense, Mr Hoolihan, do they?
AH: I believe they do.
MM: Well, can you please tell this Tribunal how when you say something is directly comparable, or as you've conceded today, is more superior, how they can be valued at less money? How does that make sense?
AH: So, again it's considered direct comparison—
MM: Let's even—
AH: --to the sites, to site, yeah.
MM: No, to the accommodation.
AH: Where does it say accommodation?
MM: Well, when you look at comparable sites, I thought you were looking at the accommodation in a comparable site, so the only thing that's gonna differ is the accommodation?
AH: I'm looking at the whole piece of accommodation – piece of van, or home, or whatever you want to call it.
MM: Mr Hoolihan, I put it to you that your valuations are completely unreliable.
AH: Disagree.
MM: And you have merely plucked figures out of the air to suit your convenience because, on the reading of this report, there is absolutely no understanding as to your method or how you have reached any of these figures, based even upon the brief methodology that you do set out. How can you have a home directly comparable, but then value it 20,000 less? That does not make sense.
AH: I didn't say its directly comparable, I said—
MM: You did.
AH: --provides a direct comparison.
MM: Are you going to argue about semantics, sir?
AH: No.
MM: Directly comparable and direct – are you – is that gonna be the nature of your evidence that a different word means $20,000?
DPW: Just one question at a time, I think.
MM: Oh well, Member, he's trying to avoid the questions.
DPW: What is the question, sorry?
MM: I'm saying that his valuations do not make sense, even upon the very limited analysis that he has provided himself at page 18.
DPW: And you'd like him to respond?
MM: I'm asking him to agree with that.
AH: No, I don't, I disagree to that.
MM: You disagree?"
1. In this passage, the valuer makes some concessions but also gives one part of an explanation of why site 54 is valued at less, namely it is "an old home, it's a caravan" rather than a manufactured home. Other relevant aspects of site 54 were also referred to at T67.3-.5. In addition, the cross-examiner in this passage appears to assume certain things in her questions but these assumptions were not independently proved. For example, part of one question related to ceiling heights in manufactured home and caravans. The question assumed that ceiling heights in manufactured home are not generally higher than in caravans. There was no evidence one way or the other on this issue. Accordingly, although the cross-examiner's propositions were put forcefully, they do not establish that the valuer's reasoning or conclusion was wrong. The valuer did not accept that he had made an error or that his opinions were not supportable.
2. Cross-examination such as this does not establish that it was not open to conclude that the 13 sales were relevantly comparable for the purposes of valuing the dwellings in question. Nor does it require the Appeal Panel to conclude that it was not open or reasonable for the Tribunal at first instance to accept the valuer's evidence.
3. The residents' contentions as to the lack of comparability of the 13 sales with the dwellings to be valued were substantially based on considerations of size and accommodation. It appears to have been assumed by the cross-examiner that the size of, and accommodation offered by, moveable dwellings were variable in a manner similar to the way in which the size and accommodation provided by houses may vary from one house to another. No evidence was called to support such a proposition. Indeed, the very nature of moveable dwellings, being caravans and manufactured homes, suggests that the size might be limited by their moveable nature and accommodation might well be more a matter of how the space available is configured rather than overall size. Caravans are limited to a size that can be towed on a public road. Manufactured homes, as the definition in s 3(1) of the Residential Parks Act indicates, are constructed in sections or modules, described as "major sections" in the definition. The valuer drew attention to the fact that manufactured homes were modular in nature and that accommodation depended on configuration rather than size in his cross-examination (at T26.6-.9). In the absence of evidence which established that the valuer was wrong and the assumptions which appear to underlie the cross-examiner's question were correct, we do not accept that this cross-examination demonstrates that the valuer's reasoning and conclusions were so flawed that they did not amount to evidentiary support for the Tribunal's conclusions based on his report or that the report could not reasonably have been accepted.
4. Furthermore, in relation to comparability of the 13 sales, we note that these sales all related to moveable dwellings which were located in residential parks in the same region as the dwellings to be valued and which had been sold within the past 12 months. This forcefully suggests that the 13 sales are unlikely to fall outside the scope of sales of moveable dwellings that could reasonably be considered to be comparable by an expert valuer. The cross-examination did not displace that likelihood. In addition, the valuer did not resile from the view that they were comparable and was able to explain his position adequately.
5. In the circumstances, and even though the valuer made a number of concessions in cross-examination, we do not accept that the only conclusion left open to a Tribunal acting rationally, at the end of the valuer's evidence, was to reject that evidence in whole because the material and reasoning relied upon provided no effective support for the opinions expressed. In our view, after the cross-examination of the valuer, it remained open for the Tribunal at first instance to accept that the 13 sales were relevantly comparable and, thus, his evidence could be accepted. The valuer's comparison of the 13 sales to the dwellings to be valued, whilst it may be subject to criticism and disagreement as illustrated in cross-examination, was not such as to fall outside the area of degree and judgment within which the valuer could formulate his opinions.
He was unable to find a solitary comparable for dwellings sold off site.
1. The residents' submissions criticised the valuer's evidence because of the lack of information, in his report and in his analysis of values, as to sales of dwellings off site, sometimes referred to as "on stumps" or in a "depot". The valuer gave evidence that although he had gone to such a depot, he had been unable to obtain reliable sales information, that is, information other than "abouts and approximations". (T30.5 - .9, T31.9 – 32.1). The residents did not provide any evidence to establish that reliable information as to such sales was available or that, if it were, it would have led to different conclusions as to the value of the dwellings.
2. In these circumstances, in our view the Tribunal's acceptance of the valuer's report and opinions is not liable to be challenged on the basis that the valuer was not able to find any reliable information concerning comparable dwellings sold off site.
He applied an arbitrary figure to determine the monetary value of the statutory rights contained within a site agreement. When asked how he arrived at that sum he conceded there was 'no basis' for doing so.
1. The residents contended that the valuer's report was flawed because the valuer applied an arbitrary figure for which there was "no basis" to determine the monetary value of the statutory rights contained within a site agreement. The statutory rights referred to were those that had been identified by Beech-Jones J in his reasons for judgment at [35] and were as set out in the Tribunal's directions in order 4. These have been called the paragraph 35 factors or [35] factors. A valuation with and without these factors was accepted, by both sides, as being equivalent to a valuation with and without the benefit of a site agreement.
2. The valuer valued the dwellings on each of the 3 bases, with and without the paragraph 35 factors. The table on p 17 of the valuer's report shows that for site 39 on Basis 3 with [35] factors, the valuer's valuation was $100,000, but without [35] factors the valuation was $80,000. Thus, it can be seen that the valuer had applied a monetary deduction of $20,000 when those factors were absent.
3. The portion of the transcript upon which the residents relied was (at T35.5 – 36.4):
"MM [The residents' counsel]: Well, can I just stop you there. What was the basis of your monetary deduction? How did you work that out?
AH [The valuer]: I didn't do a percentage deduction 'cause I didn't think – you know, there was no justification, it was a pure – for that one, it was pure $20,000 deduction.
MM: Well, it's not a pure 20,000 deduction, is it, across all sales?
AH: No, for site 39.
…
MM: You just decided that the value, if I call it that, you're saying the value of the site agreement that includes all of the section 35 was worth $20,000?
AH: Correct, for site 39, yeah. From with 35 factors and without 35 factors.
MM: Right, so you looked at it in a comparable park, you took – then you decided you would take $20,000 as if that was the value of it having a site agreement in that park, and you reached the figure of $80,000?
AH: Correct, yeah.
MM: So $80,000, using this methodology, is the value that you would give to the dwelling without it having any park agreement attached to it?
Ah: Correct.
…
DPW [Deputy President Westgarth]: Ms McMahon asked you how was the figure of $20,000 calculated.
…
AH: It was just a pure – it was a pure 20,000 deduction that I –
DPW: I know it was 20, but what was the –
AH: There was no basis –"
1. In the table on p 17 of the valuer's report, a similar deduction of $20,000 for paragraph 35 factors had also been made in respect of site 51 and deductions of $10,000 in respect of sites 54, 58 and 59. Sites 39 and 51 had a valuation with paragraph 35 factors of $100,000 or more, whereas sites 54, 58 and 59 had valuations with paragraph 35 factors of between $35,000 and $60,000.
2. The residents submitted that the acknowledgement the "[t]here was no basis" demonstrated that the valuer's opinions as to the values of the dwellings without paragraph 35 factors were without any evidentiary or logical foundation. They were said to be mere guesses. Since the values adopted by the Tribunal were the valuer's valuations, on Basis 1, without paragraph 35 factors, the Tribunal's conclusions were similarly submitted to be without any evidentiary or logical foundation.
3. This passage from cross-examination cannot, however, be looked at in isolation. The question of the deductions for paragraph 35 factors was the subject of further cross-examination (at T78.5 – 79.5) as follows:
"MM: Let's go to the first one. How were you able – what was the basis of your calculations for determining the value of paragraph 35 factors on basis 1?
…
AH: Well, if – as I said before, in page – on page 20, I worked from basis 3 backwards, okay? So, I've initially assessed the value of each dwelling as per basis 3 of the orders, okay. So that's where the direct comparison lies with the sales, and then I gave the monetary deduction.
MM: Well, what was the monetary deduction you gave to each sale?
AH: I didn't look at it like that.
MM: So, how then were you able to come up with the 20 and the 10 that you have come up with on the third basis of the valuations?
AH: I wasn't able to do a percentage – as I said before, I wasn't able to do a percentage –
MM: it's a figure that you thought sounded right?
AH: I used 20,000 for the 50 – sorry, for the 39 and 52 and 10 for the 54, 58, 59.
MM: Okay, but what does that mean? Were they figures that you just thought sounded right?
AH: Well, it was a – it was an opinion that I – yeah, I didn't have any basis to – I didn't have any basis.
MM: No basis?
AH: No.
MM: So just an opinion on no basis?
AH: There's no documented evidence to show – there was no sales evidence and – you known, to show, so I – that why I said I just did a monetary deduction.
MM: Just entirely upon no basis arising out of your skills as a qualifications –
AH: 'Cause there's no – there's no sales evidence to prove what is with and without."
1. From this, in our view, it was open to the Tribunal below to accept that when the valuer said that he had no basis for these deductions, what he meant was that he did not have any sales information available to him which would indicate what effect the presence or absence of paragraph 35 factors actually had on the prices paid for dwellings of this type. In this situation, he did not accept that making an adjustment downwards to take into account the absence of paragraph 35 factors was not based on his training, experience and judgment. s.
2. An approach similar to that adopted by the valuer in the present cases was discussed by the Court of Appeal in Leichhardt Municipal Council v Seatainer Terminals Pty Ltd (1981) 48 LGRA 409, although this was in the context of valuing land. In that case, the land to be valued was the site of a container terminal. There was no information concerning sales of container terminals available. One of the valuers in that case relied upon sales of industrial land without a water frontage as comparable sales and then added between $100,000 and $120,000 per hectare as an adjustment for the water frontage of the land to be valued. This adjustment was not based on any sales information but it was made as a matter of judgment. The appellant argued that the valuation could not be accepted or relied upon because the selection of the figures for the adjustment was in essence arbitrary or just a guess. The Court rejected this argument. Hope JA said (at 434):
"The need to make adjustments to values deduced from sales in order to arrive at the true valuation of the land to be valued does not preclude the court which has the task of valuing the land from relying upon the sales as comparable in the relevant sense, nor from the making by the court or by valuers of adjustments which may be nothing more than the best guess that can be made."
1. More recently, the Court of Appeal has endorsed this view in Sydney Water Corporation v Marrickville Council [2014] NSWCA 438 at [31]. In that same case, Leeming JA held, at [32]:
"It is plain that whether or not an adjustment to a comparable sale should be made, and if so by what amount, is likewise a matter of degree and judgment."
1. The conclusion that it was open to the Tribunal to accept the valuer's opinions notwithstanding that he made adjustments for paragraph 35 factors not based on sales information is also supported by what the Privy Council said in Secretary of State for Foreign Affairs v Churlesworth, Pilling & Co [1901] AC 373 at 391 concerning valuations more generally:
"It is quite true that in all valuations, judicial or other, there must be room for inferences and inclinations of opinion which, being more or less conjectural, are difficult to reduce to exact reasoning or to explain to others. Everyone who has gone through the process is aware of this lack of demonstrative proof in his own mind, and knows that every expert witness called before him has had his own set of conjectures, of more or less weight according to his experience and personal sagacity. In such an inquiry as the present, relating to subjects abounding with uncertainties and on which there is little experience, there is more than ordinary room for such guesswork; and it would be very unfair to require an exact exposition of reasons for the conclusions arrived at."
1. Isaacs J in the High Court in Spencer v The Commonwealth (1907) 5 CLR 418 at 442-3 quoted this passage with approval.
2. In our view, the valuer in the present cases was entitled to rely on his training, experience and judgment to make an adjustment downwards to take into account the absence of paragraph 35 factors in the manner that he did. We do not accept that the adjustments made by the valuer for the absence of paragraph 35 factors provide a proper basis for concluding that it was not open to the Tribunal to give weight to the valuer's report or that it was unreasonable to accept his opinions.
When asked to explain how he reached his conclusion that the dwellings were in fact worth less in the park than 'on stumps' off site he said he based it what he would prefer to purchase himself.
1. The residents also submitted that the valuer's reasoning to support his opinions that the values of the dwellings on Basis 2 were lower than on Basis 1 demonstrated that his opinions were fundamentally unsound and justified the conclusion that it was not reasonable to rely on his report or open to accept his valuations.
2. In this regard, however, it should be noted that the valuation on Basis 2 was not relied upon by the Tribunal below, which found that Basis 1 without regard to location or paragraph 35 factors and with the dwellings in their current state of repair was the correct basis of valuation as required by s 130A. Nor was Basis 2 a necessary step in the reasoning of the valuer in deriving the Basis 1 values from the Basis 3 values. Accordingly, even if it were accepted that the valuer's reasoning in support of his Basis 2 values was incorrect or fundamentally flawed, it would not have affected the result in these matters and would not necessarily have provided a ground for rejecting the opinions of the valuer concerning the relevant bases of valuation.
3. Nonetheless, flawed reasoning in relation to Basis 2 may be argued to constitute a ground for finding that the report as a whole was so defective that it did not provide any evidentiary support for the conclusions expressed or that it was unreasonable for the Tribunal to have accepted the report.
4. The particular point of criticism was the valuer's acceptance in cross-examination of the proposition that his expert's report was "based upon [his] own subjective feelings" (T55.7).
5. This evidence must, however, be seen in context. First, the methodology employed and the data relied upon, as recorded in his report, demonstrate that the valuer could not have been accepting that the entirety of his report, including his opinions as to valuations on Bases 3 and 1, was based solely on his own subjective feelings. It would not be reasonable for the Tribunal to have proceeded on that basis.
6. Secondly, the valuer's acceptance of the proposition would naturally be taken to apply only to the matters about which the valuer was being cross-examined at the time and having regard to the valuer's knowledge, expertise and judgment that he was required to deploy in forming his opinions and preparing his report. The relevant cross-examination included the following (at T55.4- 56.3):
"MM [The residents' counsel]: And you're saying that that [the dwelling as located in the Hastings Point Holiday Park without regard to any premium] would be worth less than the dwelling sitting on stumps in a depot.
AH [The valuer]: Correct.
MM: I put it to you that that cannot be the case.
AH: Well, I put myself in the buyer's position.
MM: Which is what?
AH: If I was – if I had to the option to either go and buy form the park – from the depot and locate, or choose to live in this particular park, my personal opinion was that I would choose to buy form the depot and locate.
MM: So your expert report is based upon your own subjective feelings?
…
AH: Yep.
MM: You've defined market value – 'cause this is what you've been asked to appraise, essentially, isn't it?
AH: Yep.
MM: It's the – what a willing buyer and a willing seller in an arm's length transaction – that's what you're meant to take into consideration, isn't it?
AH: Yeah, unfortunately those transactions just aren't available.
MM: Right, So what you've done is base this valuation [on Basis 2] according to your own needs and what you would do?
AH: Subjectively, yeah.
…
DPW (Deputy President Westgarth): But the long and the short of it is that you think these places are undervalued where they are, and that they'd have a higher value if they were somewhere else [inaudible] comparable?
AH: Correct."
1. On our view, the Deputy President's last question and the valuer's answer clarify the situation. The valuer was assessing, using his specialised knowledge, experience and judgment, what impact the fact that the dwellings were located in their present park would have on their value. To the extent that this was based on subjective considerations that a buyer might bring to such a situation as perceived by the valuer, it was legitimate.
2. The Appeal Panel also takes into account the common experience that in cross-examination, language is not always used with exemplary precision and frustration and human weakness may affect both questions posed and answers given.
3. Having regard to all these matters, we are of the view that the fact that the valuer said in cross-examination that his opinions concerning the valuations of the dwellings on Basis 2 were "based upon [his] own subjective feelings" does not justify the conclusion that it was not open to the Tribunal below to accept the valuer's opinions, especially his opinions as to the valuations on Bases 1 and 3. Nor does it lead to the conclusion that no reasonable decision maker would have accepted the valuer's report.
He was unable to support his conclusion as to a 'comparable park'.
1. The valuer was asked numerous questions in cross-examination concerning what was a "comparable park". At T36.7 and T64.5 he gave his opinion that Drifters was the most comparable park to Hasting Point Holiday Park. This was challenged, albeit ineffectively at T37.5, on the basis that the valuer contended that Drifters was not necessarily flood prone. A suggestion from cross-examining counsel that it was flood prone was not accepted and the residents did not establish in evidence that it was flood prone. The valuer also gave his understanding of what a "comparable park" referred to at T49.9 - T50.5, in answer to questions from the Deputy President. At T60.9 – 62, the valuer described walking around the Drifters park, having previously stayed at the Hastings Point Holiday Park and having obtained information as to the previous state of that park. Finally, at T88.6 the valuer stated that he considered the most comparable parks were those located on the "Tweed Coast".
2. Having regard to this material and to the locations of the parks from which the valuer took his 13 sales to be used for comparison purposes as disclosed in his report and to his report as a whole, we are of the view that the valuer adequately explained what he understood a comparable park to be and how he formed his opinions based on that understanding and the information available to him.
3. We would not conclude that the valuer was unable to support his conclusion as to a 'comparable park' or that this would lead to the conclusion that the report provided no evidentiary support for the conclusions expressed or that it would be unreasonable to accept the report and the opinions it contained in the circumstances.
He struggled with the orders.
1. The valuer did give evidence in cross-examination (at T64.1) that:
"Look, I will say yes, 'cause the – you know, the orders were quite detailed and – well, maybe detailed's not the word to use, but they were quite – yeah, I did struggle with the – with what was ordered in the orders, yeah."
1. The valuer's report, however, provides valuations on all of the bases and sub-bases required by the Tribunal's directions. The valuer explained in cross-examination how he arrived at each of his valuations and what he understood each of the bases and sub-bases to require.
2. In our view, the fact that the valuer struggled with the Tribunal's directions as to the bases for valuation to which both the residents and the owner had consented, does not provide any sufficient basis for concluding that the valuer's report provided no evidentiary support for his opinions or that it would be unreasonable to accept his report and the opinions it contained.
The Valuer's Expertise
1. In oral submissions, the residents also touched upon the valuer's relevant expertise and whether his opinions were based on his specialised knowledge. In case the residents intended to challenge the valuer's expertise and related matters for the purposes of grounds 6 and 7, we shall, for the sake of completeness, deal with this issue at this point.
2. From his curriculum vitae attached to his report, which was not effectively challenged in cross-examination, it is evident that:
1. Mr Hoolihan was an Associate Member of the Australian Institute of Valuers, a Certified Practising Valuer and a Registered Valuer - Australian Property Institute of New South Wales and a Registered Valuer - Valuers Registration Board of Queensland;
2. he had been a Registered Valuer since 1994 and held a Bachelor of Business degree from the University of Queensland;
3. his areas of expertise included "Residential property development and feasibility" and "Rental Assessments and Determinations for … Manufactured Homes Parks"; and
4. he had been continuously engaged in property valuation related work in Australia and the UK from 1994.
1. Although his curriculum vitae referred only to "manufactured homes", it would not be appropriate to assume that he was using this term in the strict sense in which it is defined in s 3(1) of the Residential Parks Act. Under that section, a "moveable dwelling" incudes a caravan and a "manufactured home", which means "a self-contained dwelling (that is, a dwelling that includes at least one kitchen, bathroom, bedroom and living area and that also includes toilet and laundry facilities) that comprises one or more major sections, and is not a registrable moveable dwelling, and includes any associated structures that form part of the dwelling". That such an assumption should not be made is confirmed by the valuer's evidence in cross examination that he had "done a number of rental assessments on parks in the Ballina, Byron and Tweed areas and [he had] done a number of valuations for acquisition and disposal of a number of shuttles, vans, [manufactured] homes in those areas" and that these had been done over the last 5 years (T15.8 - 16.3, T94.9). In addition, the valuer refers to residential parks in some cases as "Manufactured Home Parks" which also suggests that he did not use the term in a narrow sense.
2. The Tribunal below found at [126] that the valuer was a "witness of expertise" and "his experience and expertise enabled him, in my opinion [to express certain opinions as to the values of the dwellings]". There was sufficient evidentiary support for that conclusion. The Tribunal's finding was also reasonable in the sense of being a conclusion logically and rationally supported by the material before the Tribunal so that a reasonable decision maker could arrive at that conclusion. The Tribunal at first instance did not err in law in finding as it did in regard to the valuer's relevant expertise.
Pointe Gourde Principle
1. Although not one of the flaws referred to in par 47 of the residents' written submissions, the residents also submitted that the valuer had failed to comply with the Pointe Gourde principle when valuing the dwellings on Basis 2. That principle derives its name from Pointe Gourde Quarrying and Transport Co v Sub-Intendent of Crown Lands Trinidad [1947] AC 565 although the principle did not originate in that case, see Sydney Harbour Foreshore Authority v Walker Corporation Pty Ltd (2005) 63 NSWLR 407; [2005] NSWCA 251 at [31]. Kirby P has described the principle in the following terms in Haig v The Minister Administering the National Parks and Wildlife Act 1974 (Court of Appeal (NSW), 4 November 1994 unrep):
"According to the principle, which is one devised by the judges, in valuing land for resumption purposes, any increase in the land's value which is entirely due to the scheme underlying the acquisition is to be disregarded. The converse of the principle is also accepted. Any diminution in the value of land which is entirely due to the resumption scheme, or to any blight caused by a step in the resumption process, is to be disregarded in determining the value of the land …"
1. It should be noted, however, that the High Court has held that there is no "common law" principle derived from Pointe Gourde in Springfield Land Corporation (No 2) Pty Ltd v Queensland (2011) 242 CLR 632; [2011] HCA 15 at [17].
2. Nonetheless, the Tribunal's directions in order 7(c) might be seen as an attempt to incorporate something akin to this principle into the Basis 2 valuations. Under order 7(c), the valuations in accordance with order 7(a)(ii) were to be assessed disregarding the fact there was presently building works being carried out at the park and assuming that the park was in reasonable condition with access to reasonable amenities.
3. These matters were touched upon in cross-examination for example at T61.5ff but it does not appear to us that any concession was extracted from the valuer that his methodology or conclusions were flawed or unreliable in this regard.
4. Further and in any event, given that Basis 2 was held by the Tribunal below not to be the correct basis for determining the values of the dwellings under s 130A and the Tribunal therefore did not rely upon the Basis 2 valuations, nothing in our view turns on whether or not the valuer carried out the valuations correctly having regard to order 7(c) of the Tribunal's directions, to the extent that they incorporate the Pointe Gourde principle or otherwise.
5. This criticism does not provide a basis for finding that the Tribunal below erred in law by accepting the report or its conclusions, as contended by the residents.
Conclusion on grounds 6 and 7
1. The residents, if they were to succeed on grounds 6 and 7 had to establish that the Tribunal at first instance erred in law by:
1. giving weight to the value's report and opinions when there was, in effect, no evidentiary support provided by the report or the evidence for those opinions; or
2. accepting the valuer's relevant opinions as to value when no reasonable decision maker would have done so.
1. Having considered each of the flaws relied upon by the residents as summarised in par 47 and the valuer's expertise, both individually and cumulatively, we are of the view that the residents have not established that the Tribunal below erred in law on either basis.
2. In the present cases, Deputy President Westgarth heard all the evidence and had the advantage of seeing the witness and hearing the evidence as it unfolded. It would be inappropriate for the Appeal Panel to intervene in the decision making process at first instance merely because it did not agree with the Deputy President's conclusions.
3. The Tribunal below considered the valuer's evidence and the submissions of the parties and concluded at [126] and [127] that:
"126. The next question is whether the opinion and methodology of Mr Hoolihan [the valuer] can be relied upon. In my view Mr Hoolihan explained adequately his methodology and the bases for the variations in the values between the three bases. His approach which was to start by valuing the dwellings under Basis 3 (with the paragraph 35 factors) made sense because he had a body of comparable sales relevant to that basis. He had no or, considerably less information to rely upon when valuing the dwellings under Basis 1 and 2 and that explains why the changes in values under Basis 1 compared to Basis 3 were not able to be fully explained. However, his experience and expertise enabled him, in my view, to say that the Basis 1 values were less than the Basis 3 values by amounts which varied between zero and approximately $20,000.00.
127. I do not accept the contentions of the respondents that the Hoolihan report should be rejected or should be fully or partly disregarded. Mr Hoolihan was in my view able to explain the values he had given to the dwellings and adequately explain the differences between the dwellings and the comparative sales."
1. There was sufficient evidence to support these conclusions. We have referred to some of that evidence above and further supporting evidence was contained in the valuer's report and cross-examination. The report contained adequate information and explanation so as to comply with the relevant requirements of the CTTT's and the Tribunal's procedural directions concerning expert evidence. Furthermore, there was no contrary evidence establishing:
1. that the values of the dwellings were different from the valuations put forward by the valuer; or
2. that any of the valuer's methodology, sales information or reasoning was incorrect.
1. Nor did the valuer concede as much in cross-examination. The cross-examination was vigorous but did not elicit concessions that the valuations were incorrect, could not be relied upon or were based on incorrect information or reasoning. Some of the assumptions underlying the questions in cross-examination were not established on the evidence.
2. In all the circumstances, in our view, the Tribunal below was entitled to give the report and its conclusions weight. It was open to the Tribunal to accept the report in the manner in which it did, there being evidence to support it.
3. In addition, the Tribunal's conclusions and acceptance of the report and the valuer's opinion were not decisions that no reasonable decision maker could have made.
4. Any other conclusion, in the particular circumstances of these cases, would run the risk of setting such a high standard for expert evidence before it was open for the Tribunal to accept it as to be impractical and unrealistic.
5. We reject the appeal based on grounds 6 and 7.
Ground 8
1. Ground 8 concerned only Mr Tucker's site, site 39. The ground was phrased as follows:
"The Tribunal failed to take into account the orders from the Land & Environment Court in relation to the termination date for Mr Tuckers tenancy."
1. The "orders from the Land & Environment Court" were those made in TriCare (Hastings) Limited v Tweed Shire Council & Ors. [2013] NSWLEC 183 by Biscoe J. As we understood it, Mr Tucker was contending that these orders were a mandatory consideration and if they were not taken into account, it would amount to an error of law.
2. On 31 October 2013, Biscoe J had made orders declaring that a certain development consent issued by the Tweed Shire Council (identified in order 1 of those orders and called the "2007 Consent") had approved a change in the use of the land on which the Hastings Point Holiday Park was situated. His Honour also made declarations that:
1. under the 2007 Consent, sites 51, 54, 58 and 59 were to be used for a purpose other than that of a residential sites by no later than 20 September 2016 – declaration 3;
2. under the 2007 Consent, site 39 was to be used for a purpose other than that of a residential site by no later than the time of issue of an occupation certificate for Stage Two of the development – declaration 4.
1. When the Tribunal below came to make possession orders, as a consequence of having made orders terminating the relevant residential site agreements, the form of possession order was the same for each resident, namely:
"(2) The respondents will deliver up vacant possession of their respective residential sites on or before 20 September 2016;"
1. The other residents take no issue with that order, but Mr Tucker contends that this order for possession in order 2 should not have been made in his case because under the Land and Environment Court's orders no date was fixed in respect of his site 39 for when the issue of an occupation certificate for Stage Two of the development, referred to in declaration 4, had to occur.
2. It was also submitted that, contrary to what was recorded in order 5(a) of the Tribunal's directions made on 13 January 2016, there had been no consent by Mr Tucker to a possession order requiring him to leave by 20 September 2016, if other matters were determined against him. The factual basis for this submission was contested by the owner and affidavits were filed by both sides concerning the issue of whether Mr Tucker's legal representatives had or had not consented to order 5(a) or otherwise conducted the case in the Tribunal below on the basis that there was no contest that the date by which possession of site 39 should be given was 20 September 2016.
3. We do not believe it is necessary for us to resolve the issue of whether Mr Tucker's legal representatives had consented to order 5(a) or otherwise conducted the case in the Tribunal below on the basis that there was no contest that the date by which possession should be given was 20 September 2016. This is because this ground of appeal can be properly disposed of on a number of bases that do not require a resolution of that issue.
4. First, the text, scope and purpose of the Residential Parks Act do not support the conclusion that the orders of the Land and Environment Court were mandatory considerations in the relevant sense.
5. Secondly, it appears to us that the Tribunal below should be found to have taken the orders into account. Although the Deputy President did not refer in his reasons for decision to those orders of the Land and Environment Court, they were discussed in oral submissions before the Tribunal at first instance (at T123). On that occasion, the owner submitted that:
"[since] declaration 4 [concerning Mr Tucker's site] … can be accommodated within declaration 3 [concerning the other sites], the time can both go to 20 September. And that's in practical terms, because there's not going to be an occupation certificate before that date, given that declaration 4 says no later than the date of an occupation certificate, it can be 20 September."
1. The orders made by the Tribunal inherently accepted that proposition. Thus, although the Deputy President may not have referred to the Land and Environment Court orders explicitly in his reasons, it can be concluded that he took them into account. Thus, ground 8 has not been made out.
2. Thirdly, even if the Tribunal below did not take into account the Land and Environment Court's declarations concerning Mr Tucker's site and they were mandatory considerations, it would have made no difference to the result in the circumstances of this case.
3. Declaration 3 made by Biscoe J referred to 20 September 2016 because that date marked the end of the period during which the sites at the Hastings Point Holiday Park could lawfully be used as residential sites. This was explained in Biscoe J's judgment of 31 October 2013. At [17] of the judgment, it was noted that one of the conditions of the 2007 Consent required an approval to be obtained from Tweed Shire Council "for a diminished caravan park under s 68 of the Local Government Act in order to make way for the seniors development". From [19] it appears that the date of 20 September 2016 is the expiry date of this s 68 approval. This was the reason why declaration 3 referred to 20 September 2016. The reason declaration 4 did not refer to that same date was because site 39 was covered by Stage Two of the development (see [12]) and it was implicit that an occupation certificate for Stage Two of the development was expected to be issued well before 20 September 2016 (see [7] to [14] of the judgment).
4. As it has transpired, Mr Tucker has not yet vacated site 39 and there was no evidence as to when any occupation certificate in respect of Stage Two might be issued. This, however, does not change the position that the s 68 approval, as described in Biscoe J's decision, applies to all the relevant sites, including Mr Tucker's, and expires on 20 September 2016. Given that the other residents do not contest the making of possession orders requiring them to give possession on that date and in the absence of any evidence to the contrary, it cannot be concluded that the date of 20 September 2016 is not the date on which occupation of site 39 as a residential site ceases to have approval under s 68.
5. Accordingly, it appears to us that whether or not the Tribunal below considered the declarations made by Biscoe J, Mr Tucker would have been ordered to give possession from 20 September 2016 in any event, a termination order having already been made under s 113.
6. In these circumstances, we would not uphold the appeal on ground 8.
Grounds 9 and 10
1. In respect of grounds 9 and 10, the residents contended that:
1. cl 10 of Sch 2 to the Land Lease Communities Act, which came into effect on 1 November 2015 and repealed the Residential Parks Act, is applicable to the determination of compensation in this matter, notwithstanding that the applications for termination and possession orders which were the subject of the proceedings at first instance were to be dealt with under the Residential Parks Act, by operation of cl 6 of Sch 2; and
2. cl 10 of Sch 2 confers on the residents a right to have their compensation determined under s 141 of the Land Lease Communities Act.
1. The residents argued that the termination and possession orders should not have been made in the present cases until compensation was determined under s 141. Thus, the orders in the present cases should not have been made.
2. It was then submitted, alternatively, that even if the appeals were not upheld on this ground or the other grounds relied upon, the proceedings should in any event be remitted to the Consumer and Commercial Division for the determination of compensation under s 141.
3. The owner submitted cl 10 of Sch 2 did not apply because:
1. the proceedings at first instance had been commenced and not determined before the commencement of the Land Lease Communities Act and thus were governed by cl 6, supported by cl 8, of Sch 2 and cl 10 had no application in these circumstances; and
2. in any event, no compensation was payable to the residents at the commencement of the Land Lease Communities Act or thereafter and thus cl 10 of Sch 2 was not engaged.
1. Further, the owner submitted that the operation of cl 10 of Sch 2 of the Land Lease Communities Act could have been raised in the proceedings below by the residents but was not. The residents should not be allowed to raise the operation of cl 10 for the first time on appeal. Even though it was a question of law, the issue could have been met by the calling of evidence at the original hearing but no evidence as to compensation was called by the owner because the issue had not been raised.
2. We shall deal first with the question of whether the residents should be allowed to raise the operation of cl 10 of Sch 2 for the first time on appeal.
Should the residents be permitted to raise the operation of cl 10 of Sch 2 to the Land Lease Communities Act?
1. The High Court observed in Water Board v Moustakas (1988) 180 CLR 491 at 497: "a point cannot be raised for the first time upon appeal when it could possibly have been met by calling evidence below".
2. The exceptions to this principle were considered in more detail by the Court of Appeal in Mamo v Surace (2014) 86 NSWLR 275; [2014] NSWCA 58, at [76] and [77] as follows:
"76 There are recognised exceptions to the principle that a party is bound by the conduct of his or her case. Thus, there are cases which recognise that when a question of law is raised for the first time in an ultimate court of appeal (as well as an intermediate court of appeal), as for example upon the construction of a document, or upon facts either admitted or proved beyond controversy, it is expedient in the interests of justice that the question should be argued and decided: O'Brien v Komesaroff [1982] HCA 33; (1982) 150 CLR 310 (at 319) per Mason J; Coulton v Holcombe (at 8). This exception will not apply where, if the new ground could possibly have been met by calling evidence at the hearing or if, had the ground been raised below, the respondent might have conducted the case differently at trial: Multicon Engineering Pty Ltd v Federal Airports Corp (1997) 47 NSWLR 631 ("Multicon Engineering") (at 645) per Mason P (Gleeson CJ and Priestley JA agreeing).
77 The particular circumstances of each case must be considered, "with due recognition that mistakes occur, that second thoughts are sometimes good thoughts, and that the appellant is entitled to justice; but extending justice to an appellant who has failed to take a point at the trial may work an unacceptable injustice on the respondent": Chilcotin Pty Ltd v Cenelage Pty Ltd [1999] NSWCA 11 (at [18]) per Giles JA (Mason P and Priestley JA agreeing)."
1. The owner's submission is that this was a case where whether cl 10 applied and in what manner could have been met by calling evidence at the hearing. The relevant evidence identified by the owner was evidence as to the amount of compensation which might be claimed under s 141 of the Land Lease Communities Act.
2. The difficulty with this submission is that the residents' appeal under grounds 9 and 10 does not turn upon the amount of compensation to which they might be entitled under s 141. Rather the issue is what impact the fact that compensation should be determined, in their submission, under the Land Lease Communities Act has upon the decision of the Tribunal below in relation to the termination and possession orders. Consequently, the point could not have been met by the owner leading evidence concerning the amount of compensation under s 141.
3. Whether or not the provisions of the Land Lease Communities Act apply in the present cases depends upon the proper construction of that Act, including in particular, its transitional provisions in Sch 2. If cl 10 of that Schedule does apply in this case, its operation will be engaged if two conditions are satisfied:
1. notice for change of use under the Residential Parks Act had been given; and
2. compensation to any residents affected had not then been paid,
at 1 November 2015.
1. Subject to determining the proper construction of cl 10, there was no dispute concerning the factual circumstances relevant to those conditions.
2. Accordingly, it appears to us that the issues raised by grounds 9 and 10, at this stage, are points of law which depend on facts that are not in dispute. We believe that the issues raised by grounds 9 and 10 can be dealt with on these appeals without injustice to the owner. Consequently, we propose to deal with grounds 9 and 10 on this appeal.
Consideration of Grounds 9 and 10
1. These grounds depend primarily on the proper construction and application of the transitional provisions in Sch 2 to the Land Lease Communities Act (the Transitional Provisions) and the relevant compensation and related provisions of that Act. We shall consider those provisions in the following paragraphs.
Relevant Provisions of the Land Lease Communities Act
1. The Land Lease Communities Act commenced on 1 November 2015 and repealed the Residential Parks Act.
2. Section 3 of the Land Lease Communities Act relevantly provides:
"Objects of Act
The objects of this Act are as follows:
(a) to improve the governance of residential communities,
(b) to set out particular rights and obligations of operators of residential communities and home owners in residential communities,
(c) to enable prospective home owners to make informed choices,
(d) to establish procedures for resolving disputes between operators and home owners,
(e) to protect home owners from bullying, intimidation and unfair business practices,
(f) to encourage the continued growth and viability of residential communities in the State."
1. These objects are similar to those found in the Residential Parks Act. To the extent that provisions are designed to protect home owners from the types of conduct identified in par (e) or by conferring rights on them, the provisions should be treated as beneficial and remedial provisions.
Transitional Provisions.
1. The transitional provisions are found in Sch 2 of the Land Lease Communities Act. The relevant clauses include the following:
"6 Pending Tribunal or court proceedings
Any proceedings before the Tribunal or a court that were commenced before the commencement of the relevant provisions of this Act [the Land Lease Communities Act] but have not been determined before that commencement are to be determined in accordance with the repealed Act [the Residential Parks Act]."
…
8 Termination notices
Any termination notice issued under the repealed Act and operative immediately before the repeal of the relevant provisions of that Act is taken to have been issued under this Act, unless proceedings referred to in clause 6 arising from the issue of the notice are to be determined in accordance with the repealed Act as provided in that clause.
…
10 Compensation for closure
If notice for closure or change of use under the repealed Act [the Residential Parks Act] has been given and compensation to any residents affected has not yet been paid at the commencement of the relevant provisions of this Act [the Land Lease Communities Act], this Act applies in relation to the compensation.
… "
1. Thus, as a result of cl 6, proceedings under the Residential Parks Act, which were pending at the date of its repeal, continue to be dealt with under that Act.
2. By operation of cl 8, termination notices issued under the Residential Parks Act which were operative immediately before its repeal are now taken to have been issued under the Land Lease Communities Act. This does not apply, however, if there are pending proceedings that come within cl 6 and those proceedings arose from the issue of such notices.
3. If, however, new proceedings arising from termination notices issued under the Residential Parks Act are commenced after the repeal of the Residential Parks Act, the termination notices will be taken to have been issued under the Land Lease Communities Act. Those proceedings will be dealt with under the Land Lease Communities Act and not the Residential Parks Act.
4. Clause 10 of Sch 2 establishes that compensation is to be dealt with under the Land Lease Communities Act in any case where:
1. notice for change of use under the Residential Parks Act had been given; and
2. compensation to any residents affected had not been paid by the time the Land Lease Communities Act commenced on 1 November 2015.
1. The provisions of the Land Lease Communities Act that deal with compensation are ss 139, 140 and 141.
Relevant Compensation Provisions and Definitions.
1. The provisions of the Land Lease Communities Act which apply in relation to compensation where a relevant residential agreement is terminated are found in Div 6 of Pt 11 as follows:
"Division 6 Compensation for termination
139 Application of this Division
This Division applies where an operator gives a termination notice to a home owner, unless it is given under section 122 (for breach of agreement), 128 (for non-use of residential site) or 129 (for serious misconduct).
140 Compensation for relocation
(1) This section applies if, after and in consequence of receiving a termination notice given by an operator (the first operator), a home owner decides to relocate to another community and the other community is operated by a different operator.
(2) The first operator is liable:
(a) to pay in advance the likely reasonable costs of the following:
(i) removing the home from the old residential site (including the costs of disconnecting any services),
(ii) transporting the home, and the possessions of its occupants, to the new residential site,
(iii) installing the home at the new residential site (including the costs of connecting to the available services),
(iv) repairing any damage to the home arising from its relocation,
(v) landscaping the new residential site so as to bring it up to the condition of the old residential site, and
(b) to pay any additional reasonable costs incurred for those purposes after the relocation is complete.
(3) The costs are payable to or at the direction of the person who was the home owner who received the termination notice.
(4) 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.
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."
1. The expressions "home", "home owner", "operator", "owner", "residential site", "site agreement" are defined in s 4(1) as follows:
"home means:
(a) any caravan or other van or other portable device (whether on wheels or not) other than a tent, used for human habitation, or
(b) a manufactured home as defined in the Local Government Act 1993, or
(c) any conveyance, structure or thing of a class or description prescribed by the regulations for the purposes of this definition.
home owner means:
(a) a person who owns a home on a residential site in a community that is the subject of a site agreement (whether or not the person resides at the site), or
(b) a person who obtains an interest in a site agreement as the personal representative, or a beneficiary of the estate, of a deceased individual who, immediately before the individual's death, was a person mentioned in paragraph (a), or
(c) another successor in title of a person mentioned in paragraph (a),
but does not include any person, or any person of a class, excluded from this definition by the regulations.
…
operator of a community means a person who is:
(a) the person who manages, controls or otherwise operates the community, including by granting rights of occupancy under site agreements or tenancy agreements, whether or not the person is an owner of the community, or
(b) the personal representative, or a beneficiary of the estate, of a deceased individual who, immediately before the individual's death, was a person mentioned in paragraph (a), or
(c) a mortgagee in possession of a community for which site agreements are in force, or
(d) another successor in title of a person mentioned in paragraph (a),
other than a person, or a person of a class, excluded from this definition by the regulations.
owner of a community means:
(a) the owner of land on which the community is located, or
(b) the personal representative, or a beneficiary of the estate, of a deceased individual who, immediately before the individual's death, was a person mentioned in paragraph (a), or
(c) a mortgagee in possession of a community for which site agreements are in force, or
(d) another successor in title of a person mentioned in paragraph (a),
other than a person, or a person of a class, excluded from this definition by the regulations.
…
residential site means a site in a community for a home that is used, or is intended to be used, as a residence by an individual.
…
site agreement means an agreement under which the operator of a community grants to another person for value a right of occupation of a residential site in the community."
1. Section 140 of the Land Lease Communities Act, in effect, replaces s 128(3) of the Residential Parks Act.
2. Applying the definitions in s 4(1) to s 140, it can be seen that, in a case where a "home" (which corresponds to a "dwelling" under the Residential Parks Act) is to be relocated to a different residential community on termination of the relevant site agreement for change of use, the compensation under s 140 will be likely to be substantially the same as the compensation determined under s 128(3) of the Residential Parks Act. The matters to which the Tribunal was required to have regard under s 128(3)(a) to (e) are virtually identical to the relevant costs identified in s 140(2)(a)(i) to (v). In addition, s 140(2)(b) appears to correspond with s 128(2A) of the Residential Parks Act.
3. By way of contrast, s 141 of the Land Lease Communities Act approaches compensation for a home owner who does not want to, or cannot, relocate to another community very differently from ss 128(4) and ss 113(3A) and 130A of the Residential Parks Act.
4. Under the Residential Parks Act, in a case of termination as a result of a notice under s 102 where the dwelling was not to be relocated, the resident was entitled to compensation under s 128, because of s 102(5), but the factors in s 128(4) (apart from par (4)(c)) were not well suited to providing adequate compensation. Those factors provided little, if any, scope for compensation for loss of residency or for relocation such as s 141(5) of the Land Lease Communities Act now provides. In addition, ss 113(3A) and 130A, introduced in 2005 to alleviate some of the inadequacies of s 128(4) in this situation, only ensured that the resident could agree to sell the dwelling at a reasonable price to the park owner, if it was not to be relocated. The inadequacies of s 128(4) were not otherwise addressed.
5. Under s 141(1) of the Land Lease Communities Act, the operator ('"park owner" under the Residential Parks Act) is liable to pay compensation to the home owner ("resident" under the Residential Parks Act) if two conditions are satisfied:
1. The operator has given a termination notice to the home owner; and
2. The home owner does not want to relocate to another community or is unable to do so.
1. This is unlike s 102(5) of the Residential Parks Act where the entitlement to compensation arises on termination as a result of change of use notice. The entitlement to compensation under s 141 is not dependent upon termination of the agreement or upon there being proceedings in the Tribunal for termination or possession orders.
2. The amount of the compensation may be governed by the site agreement, see s 141(2). If not, s 141(3) provides that the home owner is entitled to compensation for both loss of residency and relocation (s 141(3)(a) and (b)). The relevant factors are spelt out in ss 141(4) and (5). These go well beyond the factors to be taken into account under s 128(4) of the Residential Parks Act.
3. Under s 141(4)(c) of the Land Lease Communities Act, "the current on-site market value of the home ["dwelling" under the Residential Parks Act] (determined as if the termination were not to occur)" is only one factor to which the Tribunal must have regard in determining the amount of "compensation payable for the loss of residency". Under s 130A(2) and (4) of the Residential Parks Act, the Tribunal was to determine the value of the dwelling only "not hav[ing] regard to the dwelling's location".
4. In addition, there is an express requirement in s 141(7) on the home owner to transfer title to the operator of the community in return for the payment of compensation under s 141, if the home owner does not intend to keep the home. This takes a different approach from that adopted in s 113(3A)(b) of the Residential Parks Act which depended upon there to be an agreement to purchase the dwelling as the means of transferring title.
5. It is also important to note that under s 141(8) either the home owner or the operator can apply to the Tribunal to resolve a dispute concerning the operation of s 141 in the circumstances of the particular case. The right to apply is not limited, as was the right to apply in s 128(2) of the Residential Parks Act.
6. Relevant Extrinsic Material. The second reading speech for the Residential (Land Lease) Communities Bill 2013 (New South Wales Legislative Assembly, Parliamentary Debates (Hansard), 18 September 2013 at 23732) contained the following concerning compensation:
"Compensation to residents in the event of closure or relocation has also been improved in the bill.
For instance, one of the new factors for the tribunal to consider in deciding how much compensation to award to the resident is the current on-site market value of the home, determined as if the termination were not to occur.
There is a range of other changes in the bill to improve the compensation provisions as a result of termination or relocation.
The bill makes it clear that the home owner is to be compensated for both loss or residency and relocation.
Whether the home owner chooses to relocate the home elsewhere will be up to them.
The bill recognises that this may not be possible or desirable and that they may prefer or have no choice but to walk away from the home.
Compensation is to be payable under the bill no matter what they decide.
The existing law only provides compensation if the home owner keeps the home."
1. The reference by the Minister to the "current on-site market value of the home" indicates that these comments are directed only to compensation under s 141 and not under s 140. Similarly, compensation for "both loss of residency and relocation" arise only in relation to s 141 compensation. Thus, the improvements in relation to compensation in the Land Lease Communities Act to which the Minister is referring are those relating to the situation where the home is not to be relocated. In short, s 141 is said by the Minister to be an improvement upon ss 102(5), 113(3A)(b), 128(4) and 130A.
2. The Minister's statement that the "existing law only provides compensation if the home owner keeps the home" appears to refer to the problematic interaction of ss 113(3A)(a) and 128 of the Residential Parks Act and the fact that s 113(3A)(b) and 130A do not establish a right to statutory compensation but merely a mechanism which at most involves an agreement to buy the dwelling, if it is not to be relocated. The statement can also be seen as reflecting the perception that a resident who is given a s 102 notice cannot obtain adequate compensation under s 128 but only, at most, "the reasonable costs of transporting the possessions of the residents of the dwelling to their new place of residence" referred to in s 128(4)(c).
3. The second reading speech indicates that the Land Lease Communities Act was designed to improve compensation for residents/home owners whose site agreements were terminated and whose home was not to be relocated.
Relevant Legal and Factual Circumstances
1. The relevant facts for the purposes of grounds 9 and 10 were not in dispute and include that:
1. the owner gave notices of termination under s 102 of the Residential Parks Act on the ground of change of use to each of the residents before 1 November 2015;
2. the s 102 notices were operative immediately before the repeal of the Residential Parks Act on 1 November 2015;
3. the proceedings the subject of these appeals were for termination and possession orders under s 113 of the Residential Parks Act arising out of those s 102 notices and those proceedings had not been determined before 1 November 2015;
4. each of the residents' dwellings is not to be relocated when possession is given of the site in question.
Application of the Transitional Provisions to the circumstances
1. The parties and the Tribunal below accepted that, since the proceedings the subject of these appeals had been commenced and not relevantly determined before the commencement of the Land Lease Communities Act on 1 November 2015, cl 6 had the effect of requiring the proceedings to be determined in accordance with the Residential Parks Act. This approach was correct.
2. The hearing at first instance also proceeded on the basis that the notices of termination issued under s 102 of the Residential Parks Act were not taken to have been issued under the Land Lease Communities Act because the exception in cl 8 applied. Under that exception, the notices continue to operate as notices under the Residential Parks Act if the proceedings arising from the issue of those notices are to be determined in accordance with the repealed Act, as provided in cl 6. This was also, in our view, correct as far as the present proceedings at first instance were concerned.
3. Clause 8 may, however, have further relevant application in the circumstances of these proceedings, if the exception in that clause does not apply. The s 102 notice issued to each of the residents was "issued under the repealed Act and operative immediately before the repeal of the relevant provisions of that Act". Consequently, where the exception does not apply, those notices are taken to have been issued under the Land Lease Communities Act. The provisions that are equivalent to s 102 of the Residential Parks Act are either:
1. s 124 of the Land Lease Communities Act, which applies where "the community is to be closed and used by the operator or another person for a purpose other than a residential community"; or
2. s 125 of that Act, which applies where in respect of a particular residential site "there is to be a change in use of the site".
1. This is significant because, if notices are issued under ss 124 or 125 of the Land Lease Communities Act, s 139 is engaged so that the resident ("home owner" under the Land Lease Communities Act) will be entitled to compensation:
1. under s 140 of the Land Lease Communities Act, if the resident/home owner chooses to relocate to a community operated by a different operator; or
2. under s 141 of that Act, if the resident/home owner does not want, or is unable, to relocate to another community.
1. Compensation under s 141 is, as has been noted above, much more substantial that the very limited compensation available, when the dwelling was not to be relocated, under s 102(5) and s 128(4)(c) or as result of the operation of s 113(3A)(b) and s 130A.
2. The effect of cl 10 is that if:
1. notice for change of use under the Residential Parks Act has been given; and
2. compensation to any residents affected has not yet been paid at 1 November 2015,
the Land Lease Communities Act applies in relation to the compensation. Thus, compensation is to be determined in these situations under ss 139, 140 and 141.
1. It was accepted by all parties, correctly in our view, that:
1. each of the notices under s 102 relied upon in the present matters fall within the description "notice for … change of use under the repealed Act" in cl 10;
2. the residents, who are the appellants in the present appeals, are "residents affected" within cl 10, because they are affected by the s 102 notices; and
3. no compensation to any of the residents, has been paid prior to 1 November 2015 or at all.
1. Accordingly, cl 10 applies in the circumstances of the present matters.
2. Since cl 10 is engaged and the Land Lease Communities Act applies in relation to compensation for the residents, the issue arises as to how cl 10 interacts with cl 6 (which as explained above is also engaged) in the context of the present proceedings.
The Parties' Submissions
1. The residents contended that because the Land Lease Communities Act applied in relation to compensation, the Tribunal at first instance was wrong to rely on being satisfied of the matter in s 113(3A)(b) as the basis for making a possession order under s 113 of the Residential Parks Act. It was said that the Tribunal should have determined compensation under s 141 of the Land Lease Communities Act and ordered that the residents give possession of their respective sites only when that compensation had been paid. The residents' submissions did not identify under what provisions of the Residential Parks Act or the Land Lease Communities Act, such possession orders could have been made.
2. The owner submitted that cl 6 takes precedence over cl 10 and, in any event, no compensation was payable to the residents under the Residential Parks Act and thus cl 10 was not engaged. Consequently, it was said that the proceedings at first instance were correctly conducted on the basis that those proceedings were to be determined only under the Residential Parks Act. The Land Lease Communities Act had no relevant application in the Tribunal below.
The Interaction of Cl 6 and Cl 10 of the Transitional Provisions
1. There are at least two reasons for rejecting the residents' submissions concerning the interaction of cll 6 and 10 of the Transitional Provisions in relation to the proceedings the subject of these appeals.
2. First, even if the Land Lease Communities Act applies in relation to compensation, that Act can only operate in accordance with its terms. The Division, of which s 141 is a section, only applies if the requirements of s 139 are satisfied. Relevantly, s 139 states:
"This Division applies where an operator gives a termination notice to a home owner [subject to certain exceptions which are not relevant]."
1. Similarly, under s 141(1), liability to pay compensation to a home owner depends on whether the operator has given "a termination notice to the home owner".
2. Thus, before any compensation could be payable under s 141 there must be a relevant "termination notice" that has been given by the operator/park owner to the home owner/resident. "[T]ermination notice" is defined in s 4(1) to mean "a termination notice under Part 11 given by a party to a site agreement". In the present cases, the owner did not give termination notices under Pt 11 of the Land Lease Communities Act but rather s 102 notices under the Residential Parks Act.
3. While cl 8 of the Transitional Provisions might generally have the effect of requiring termination notices issued under the Residential Park Act to be taken to have been issued under the Land Lease Communities Act, that is not the case where the exception in cl 8 applies.
4. That exception applied in the present proceedings at first instance because those proceedings arose out of the issue of the s 102 notices and they were to be determined in accordance with the Residential Parks Act as provided in cl 6. Consequently, for the purposes of the proceedings before the Tribunal at first instance, the s 102 notices would not have been taken to be "termination notices under Part 11 [of the Land Lease Communities Act]". Consequently, the liability on the park owner or operator to pay compensation under s 141(1) would not have arisen. The residents could not have obtained compensation under s 141 of the Land Lease Communities Act in the proceedings at first instance, even though cl 10 was engaged in the circumstances.
5. Secondly, when cl 10 is engaged, that clause only provides that the Land Lease Communities Act "applies in relation to the compensation". The expression "the compensation" refers back to "compensation to any residents affected" by the termination notices that had not been paid prior to 1 November 2015. While no such compensation had been paid prior to that date in these cases and cl 10 established that the Land Lease Communities Act applied, it could only apply in relation to compensation. Being so limited in its terms, cl 10 could not have the effect of making the Land Lease Communities Act applicable in relation to the making of termination or possession orders.
6. The proceedings that are the subject of this appeal were only proceedings for termination and possession orders. Thus, even though cl 10 was engaged in the circumstance of these proceedings after 1 November 2015, it had no role to play as the proceedings were confined to the making of termination and possession orders. Further, and as we have explained above, even if compensation had been sought in the proceedings at first instance, the residents would not have been entitled to compensation under s 141 in those proceedings.
7. As we understood it, at this point the residents submitted to the following effect:
1. since the possession orders could only be made, in the circumstances of these cases, if the Tribunal was satisfied of the matter in s 113(3A)(b);
2. that matter related to compensation in the broad sense;
3. cl 10, if it is given a liberal construction befitting such a beneficial provision, required such compensation to be determined under the Land Lease Communities Act;
4. therefore, in these cases, the Tribunal should have applied s 141 in determining whether it was satisfied in relation to compensation so as to be able to make a possession order under s 113(3A)(b).
1. We accept that cl 10 is a beneficial provision whose purpose is to protect residents from being required to leave their residences without adequate compensation. Nonetheless, in our view, it is not possible for the Tribunal to be satisfied that "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" otherwise than if the owner has agreed to do what is set out in s 113(3A)(b). In other words, the Tribunal could not make a possession order relying on s 113(3A)(b) if all that it was satisfied of was that the owner was liable to pay or had paid an amount of compensation determined by the Tribunal in accordance with s 141 of the Land Lease Communities Act. The language of s 113(3A) does not permit that to occur, even on the most liberal construction of all of the relevant provisions.
2. Thus, in our view, the Tribunal below did not fall into error by not applying the Land Lease Communities Act in the proceedings or by making the termination and possession orders that it did under the Residential Parks Act. Consequently, we would dismiss the appeal on grounds 9 and 10.
The residents' seeking in the alternative to have the proceedings remitted for compensation to be determined under s 141 of the Land Lease Communities Act
1. The residents submitted in the alternative that, even if the termination and possession orders were not set aside, the proceedings should be remitted to the Consumer and Commercial Division for compensation to be determined under s 141 of the Land Lease Communities Act.
2. We are not prepared to remit the proceedings to the Consumer and Commercial Division for the purpose of determining compensation. There would be no utility in doing so because the residents will not be entitled to compensation under s 141 in these proceedings if they are remitted. This follows from the operation in these proceedings of cll 6 and 8 in relation to the termination notices upon which the residents would have to rely, as we have explained above.
3. That is not to say, however, that cl 10 may not have some role to play in the future relations between the parties to this appeal or that the residents cannot obtain compensation determined in accordance with s 141 of the Land Lease Communities Act.
4. We make these comments bearing in mind s 38(5)(a) of the NCAT Act and what fell from the Court of Appeal in Moloney v Taylor [2016] NSWCA 199. In an appeal from decision of NCAT's Appeal Panel, the Court of Appeal held that the Appeal Panel was correct in concluding that the Tribunal did not have jurisdiction to make the order that it had made under s 34 of the Holiday Parks (Long-term Casual Occupation) Act 2000 (NSW), but erred in refusing to remit the claim for compensation in circumstances where another provision of that Act could have founded the compensation order. The Court of Appeal held (at [30]-[31] footnotes omitted):
"30. Nevertheless, as is apparent from the provisions of s 36 [of the NCAT Act] to which we have referred, a body such as the Tribunal (which expression includes the Appeal Panel) is not expected to conduct its proceedings with the formality of a court of law. Rather, it is required to conduct itself with minimum formality and to reach decisions according to the substantive merits of the case, and not by reference to legal form or technicalities. Further, it is to exercise its powers speedily and economically.
31. On appeal, the question for the Appeal Panel was whether in substance the Tribunal had made an appealable error and, if so, what orders should be made which would best achieve justice between the parties having regard to that error and the provisions of the Act. That question was not addressed, or not properly addressed, simply by asking the question whether the Tribunal had power to make the orders sought under the provision relied on by the Tribunal."
1. Under the Residential Parks Act, if it had continued in force, the residents could previously have made or could now make an application for compensation to which they were entitled under s 102(5), limited though it was under s 128(4), in one of two ways:
1. by application in the proceedings the subject of these appeals because they had been brought under s 113 on the ground referred to in s 102, see s 128(2)(a); or
2. by application in any proceedings commenced within 6 months after vacating their residential sites in compliance with a notice referred to in s 102, see s 128(2)(c).
1. After the repeal of the Residential Parks Act and the commencement of the Land Lease Communities Act, however, cl 10 of the Transitional Provisions, supported by cl 8, applies.
2. As explained above, there is no basis for remitting the proceedings. Since cll 10 and 8 apply, however, there may be utility in the residents making new applications to the Tribunal under s 141(8) seeking to have the Tribunal resolve a dispute concerning the operation of s 141 in the circumstances of these particular cases. In respect of such proceedings, cl 6 of the Transitional Provisions and the exception in cl 8 would not operate.
3. In these new proceedings, cl 10 of the Transitional Provisions would be engaged because:
1. notices for change of use under the Residential Parks Act has been given to each of the residents;
2. compensation to each of the residents affected by the notices has not been paid as at 1 November 2015, and
since the new proceedings had not been commenced before the commencement of the Land Lease Communities Act, cl 6 is not engaged.
1. In such circumstances, the effect of cl 10 might be that the compensation to which the residents are now entitled as a result of being affected by the s 102 termination notices is to be determined in accordance with ss 140 and 141 of the Land Lease Communities Act not s 128 of the Residential Parks Act. This would flow from the wording of the cl 10 considered in the context of the objects of the Land Lease Communities Act, the mischief that the Act was designed to remedy and the fact that it is appropriate to adopt a liberal construction of the clause because it is a beneficial and remedial provision.
2. Section 30(1)(c) of the Interpretation Act would usually operate so as to preserve the rights, obligations or liabilities acquired, accrued or incurred under the Residential Parks Act. That provision will not apply, however, in so far as the Land Lease Communities Act, the Act which repealed the Residential Parks Act, expresses a contrary intention. This is the result of the operation of s 5(2) of the Interpretation Act. The High Court held in ADCO Constructions Pty Ltd v Goudappel [2014] HCA 18; 254 CLR 1 at [27] (footnotes omitted):
"… the protection of accrued rights provided by s 30(1)(c) of the Interpretation Act (read with s 5(2) of that Act) mirrors the common law as enunciated by Dixon CJ in both Maxwell v Murphy and Chang Jeeng v Nuffield (Australia) Pty Ltd. Referring, in that latter case, to "the rules of interpretation affecting what is so misleadingly called the retrospective operation of statutes", his Honour said:
'The general rule of the common law is that a statute changing the law ought not, unless the intention appears with reasonable certainty, to be understood as applying to facts or events that have already occurred in such a way as to confer or impose or otherwise affect rights or liabilities which the law had defined by reference to the past events.'
1. In our view, cl 10 of Sch 2, taken together with cl 8, amount to such an expression of contrary intention which has sufficient clarity to displace the operation of s 30(1)(c) in relation to compensation for residents affected by termination notices for change of use.
2. Accordingly, in the new proceedings, compensation would be determined in accordance with the Land Lease Communities Act. By operation of cl 8 of the Transitional Provisions, in such new proceedings the termination notices which were issued under s 102 by the owner and which were operative immediately before 1 November 2015 would be taken to be notices under the Land Lease Communities Act. This is because the exception in cl 8 would not be applicable in respect of proceedings begun after 1 November 2015.
3. The termination notice provisions of the Land Lease Communities Act which are equivalent to s 102 of the Residential Parks Act are ss 124 and 125, which relevantly provide:
"124 Termination by operator for closure
(1) The operator of a community may give a termination notice on the ground that the community is to be closed and used by the operator or another person for a purpose other than a residential community.
…
(5) The termination notice must not specify a date for vacating the residential site that is earlier than:
(a) 12 months after the day on which the notice is given, or
(b) in the case of an agreement for a fixed term, the day following the date on which the fixed term ends,
whichever is the later.
…
125 Termination by operator for change in use of residential site
(1) The operator of a community may give a termination notice for a particular residential site on the ground that there is to be a change in use of the site.
…
(5) A termination notice given under this section must not specify a date for vacating the residential site that is earlier than:
(a) 12 months after the day on which the notice is given, or
(b) in the case of an agreement for a fixed term—the day following the date on which the fixed term ends,
whichever is the later.
…"
1. If cl 8 is construed liberally because it is also a beneficial, remedial provision, a notice originally issued under s 102 of the Residential Parks Act would, by operation of cl 8, be taken, in new proceedings to which cl 6 does not apply, to be a notice given under s 124 or s 125 of the Land Lease Communities Act. Thus, each resident in these appeals would be a "home owner" who has been given a "termination notice", within the meaning of ss 139(1) and 141(1) of the Land Lease Communities Act, by the operator of the community. As a result, the operator of the community would be liable to pay compensation as provided for by s 141 to each resident, as such a home owner.
2. The issue might arise in such new proceedings whether a resident who accepted the sum of money that the park owner was required to pay or tender under order 3 made on 6 April 2016 and who transferred the dwelling to the park owner could recover compensation under s 141 of the Land Lease Communities Act in the new proceedings commenced after these appeals are determined. There appears to be nothing precluding a resident who has sold to the park owner in such circumstances obtaining compensation under s 141.
3. In resolving any dispute as to the amount of compensation payable under s 141, however, the Tribunal might well be obliged to take into account the amount such a resident had received on the sale of the dwelling and how that amount had been determined. This latter consideration might be relevant because, under s 130A of the Residential Parks Act, the value that the price payable was required to exceed did not take into account the location of the dwelling, any site agreement or the paragraph 35 factors. By way of contrast, under s 141(4), the compensation payable is such amount as is reasonable having regard to "the current on-site market value of the home (determined as if the termination were not to occur)" as well as the other factors in s 141(3) and (4).
4. If there is a dispute concerning the operation of s 141 in the circumstances of these particular cases, we would encourage the parites to make any application under s 141(8) to resolve that dispute promptly, so as to ensure that there is no further unnecessary delay in bringing to finality all issues that arise out of the change of use of the Hasting Point Holiday Park.
Conclusions and Orders
1. For all of these reasons, we propose to dismiss the appeals.
2. None of the grounds of appeal challenged the basis for making the termination orders under s 113(2) and (3) of the Residential Parks Act independently of there being no power to make possession orders. Consequently, there is no reason for setting aside order 1, the termination order, made on 6 April 2016 in each matter. That order should be confirmed.
3. As to the possession order, order 2, and the consequential orders, none of the grounds of appeal has been made out and the appeal is to be dismissed. Given the terms of Biscoe J's declarations and the reasons why 20 September 2016 is an appropriate date by which all the residents should be required to give possession, it is also appropriate to confirm order 2 in each matter. Similarly, having regard to the requirements of s 113(3A)(b) of the Residential Parks Act and the circumstances of the owner and the residents and the relative hardship suspension is likely to cause to the owner and the residents, we are satisfied that it is desirable to confirm orders 3 and 4 suspending the operation of the order for possession in each matter. It is convenient to retain order 5, in case it is necessary to clarify any aspect of the operation of the orders.
4. Since the appeal has been unsuccessful and for the other reasons we have given, we decline to remit the proceedings to the Consumer and Commercial Division for any further hearing.
5. Finally, each party sought costs of the relevant appeal or appeals. We have not had the benefit of any submissions in relation to costs. Whilst we should not be taken as encouraging any party to press an application for costs, we shall also make directions concerning costs submissions, in case any party now wishes to press such an application.
6. Accordingly, the orders of the Appeal Panel are in each appeal:
1. Appeal dismissed.
2. Orders 1, 2, 3, 4 and 5 made on 6 April 2016 are confirmed.
1. In addition, in each appeal, the Appeal Panel directs that, If any party wishes to press an application for costs of this appeal:
1. The party is to file and serve any submissions on costs and on whether the application should be dealt with on the paper without an oral hearing on or before 3 October 2016;
2. Any party which opposes the ordering of such costs is to file and serve any submission on costs and on whether the application should be dealt with on the paper without an oral hearing on or before 17 October 2016; and
3. The party pressing the application for costs is to file and serve any submissions in reply on or before 24 October 2016.
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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
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Decision last updated: 19 September 2016