LIGHT AT THE END OF THE TUNNEL? - Land lease ...
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Land Lease Communities Magazine • Issue 7 • July 2021
LIGHT AT
THE END
OF THE
TUNNEL?
Also in this issue:
• The Review of the Residential
(Land Lease) Communities Act
Electricity charges in
land lease communities • Local government regulations
impact on home owners
• Site fee increase methods
• And much more...
The long-running dispute over the operator nor Hum Energy Ros Chapman, home owner at
electricity charges in land had broken any rules or laws Nambucca River Tourist Park,
lease communities continues. regarding this arrangement. went to the Tribunal after the
Just over 12 months ago we However, some home owners operator outsourced electricity
became aware of, and reported were resisting the transfer and provision. The Tribunal found in
on, operators relinquishing their the Tenants’ Union was working Ros’s favour – her site fees have
right to on-sell electricity to with Tenants Advice & Advocacy been reduced (see pages 3-4).
home owners and passing that Services and the Tweed Photo: Grace Saad Photography,
responsibility to Hum Energy, Residential Park Homeowners Mid North Coast.
or another energy retailer. At Association (TRPHA) regarding
that time the Energy and Water options for those home owners
Ombudsman of NSW (EWON) to resolve their disputes. We can
and NSW Fair Trading had now report on two developments.
both determined that neither Continued on page 2...
Acknowledgement of Country
We acknowledge that Aboriginal and Torres
Strait Islander Peoples were the first sovereign Continued from front cover...determined that Hum
Nations of the Australian continent and its became the ‘deemed’
adjacent islands, and that these lands were Explicit Informed supplier under these
possessed under the laws and customs of
those Nations. The lands were never ceded Consent arrangements and could
provide energy, bill home
and always remain Aboriginal and Torres Strait
Islander Country. Our office is on the Country Along with EWON and NSW owners, and disconnect
of the Gadigal People of the Eora Nation. Fair Trading, the Australian them if they didn’t pay.
Energy Regulator (AER) Sandy Gilbert put the
Outasite magazine Issue 7, July 2021 had been consulted about question of consent to the
Contents: the arrangements between AER when she met with
operators and Hum Energy them and they confirmed
Light at the end of the tunnel? 1 and they could see the position under the
Review overview 5 nothing wrong either. National Energy Retail
Reckless retaliation? 8 However, when home Law, saying:
Community by definition 10 owners took a stand and “An energy retailer must
refused to sign contracts obtain your explicit and
Damage, loss and abandonment 12
with Hum, and were informed consent before
Unstable ground 14 subsequently threatened creating an agreement for
Local government complications 18 with disconnection of the sale of electricity.
An independent voice 23 their supply, Sandy Gilbert
When obtaining a
from TRPHA went back
Interference with sale of home 26 customer’s consent, the
to the AER with a new set
Age restriction rule allowed 30 National Energy Retail Law
of questions and issues.
Retirement upheaval update 32 requires the consent to be
both explicit and informed.
Contempt 34 The requirements
David vs Goliath 37 are summarised as follows:
Palm Lake Resort appeal dismissed 39
ners Assn.
• A customer’s consent
Outasite editor: Leo Patterson Ross must be given either
Authors: Julie Lee, Paul Smyth & others listed in writing, verbally or
Design and typesetting: Jeremy Kerbel electronically.
eow
Copyright of Outasite remains with the Tenants’ • An energy retailer must
om
Union of NSW and individual contributors. maintain a record of
kH
Disclaimer: Legal information in this newsletter an r
Pa
S
dy . each EIC provided by the
is intended as a guide to the law and should Gilb Res
ert, Tweed customer, which includes
not be used as a substitute for legal advice.
It applies to people who live in, or are affected information that will
One of the questions enable the AER to verify
by, the law as it applies in NSW, Australia.
the Tenants’ Union had the retailer’s compliance
Printed on recycled paper by Indigi-Print –
Indigenous owned, full-service print concerning Hum stepping with its EIC obligations.
management, Australia-wide. ISSN 2209-105X into an operators’ shoes
• An energy retailer must
to supply home owners
produce a satisfactory
About the Tenants’ Union in an embedded network
record of the informed
was regarding consent
The Tenants’ Union of NSW is the resourcing consent if a customer
body for Tenants Advice & Advocacy Services from home owners. It was
asserts that EIC was not
(TAAS) and a community legal centre. We are an our understanding that an
obtained.
independent, secular not-for-profit membership- energy retailer must obtain
based co-operative. We receive principal funding explicit informed consent The National Energy Retail
from the TAAS Program administered by NSW (EIC) from a customer Rules includes a protection
Fair Trading, and the Community Legal Centres before they could become that prohibits a customer
Program administered by Legal Aid NSW. their retailer. EWON had from being disconnected
Phone: 02 8117 3700
Email: contact@tenantsunion.org.au
Web: tenants.org.au/thenoticeboard
Office: Lvl 5, 191 Thomas St, Haymarket NSW 2000
if the issue of whether the The operator outsourced the new Daily Supply Charge,
customer consented to the embedded network to Hum and the resulting increase
transfer remains unresolved. Energy in February 2020. in electricity charges for
If a retailer does not obtain a This resulted in higher the home owner.
customer’s EIC to a transfer charges for Ros including
The Tribunal determined
(which includes cases of a Daily Supply Charge of
that Ros’ site fees should
customer transfers without 151.25 cents per day.
be reduced by $10 per week,
consent) the transfer and the which is the approximate
The crux of the application
contract with the retailer is void.”
to the Tribunal was that amount of additional
This clarification is heartening the site agreement electricity charges she has
for Margaret Reckless (see contained terms that the been paying since Hum
page 8) and other home operator was the supplier started supplying her with
owners who refused to sign of electricity to the site and the electricity. The site fee
contracts with Hum Energy home owner was to pay the reduction was backdated
or give their consent to be operator for electricity used to February 2020 and the
transferred. It confirms that at the site. Ros argued that operator was ordered to
operators cannot simply step by withdrawing from being refund Ros the sum of $520.
out of supplying electricity to the electricity supplier the
home owners and invite an The site fee reduction will
operator was in breach
energy retailer to take over the remain in place until a group
of the site agreement and
embedded network. Electricity application challenging a site
was making an impermissible
charges for home owners fee increase is heard by the
attempt to unilaterally
on embedded networks are Tribunal. Ros’ site fees will be
vary the terms of the site
governed by the Residential considered in the context of
agreement.
(Land Lease) Communities that application.
Act but, if a home owner Ros further argued that
signs with an external energy electricity was a service the What will come out
retailer, they lose the benefit operator had contracted to
of that protection and charges provide and that they had of the Act review?
may increase significantly. withdrawn that service.
As we mention in our article
The Tribunal was satisfied on the review of the Act (see
A win at the Tribunal that Ros’ site fees should page 5), the Government will
be reduced. It found “a be fast-tracking changes
The second development
communal facility or service to electricity charges for
is that the NSW Civil and
provided at the community home owners on embedded
Administrative Tribunal
when the agreement was networks. That work has
(NCAT) has recently handed
down a decision regarding entered into has been already started and the
an application by a home withdrawn or substantially Tenants’ Union, along with
owner that the operator reduced for the purposes other key stakeholders, have
was breaching the site of section 64 of the Act, by been in discussion with the
agreement by ceasing to the operator ceasing to on- NSW Fair Trading Policy Team
supply electricity to the site. sell electricity to the home regarding how those charges
Ros Chapman (the home owner.” The Tribunal said that should be calculated. We are
owner) sought orders that the although the service had been hopeful that home owners will
operator recommence supply replaced by a different service, not have to wait too long for a
and pay compensation to her, the supply of electricity was more stable charging system
or in the alternative that her on different terms. Those that is fair to them and also
site fees be reduced. different terms included the to operators.
Outasite: Land Lease Communities Magazine • 3
“The residents of our park “Fortunately, the excellent “This has highlighted for us the
were all dismayed when told assistance from the Mid Coast importance of the Residential
the operators had withdrawn Tenants Advice & Advocacy Land Lease Communities Act,
from electricity provision, Service enabled our individual the Tribunal, and the Tenants’
and without discussion, Tribunal application, which Union in supporting the rights
prior notice or consent, was, in part, successful. of residents in residential
had appointed an external The remaining 38 residents, communities such as ours.
electricity provider who in the same situation, have We hope the review of the Act
implemented a renewal of now written to the operator will further support our rights”
the Daily Supply Charge. seeking the same outcome. – Ros Chapman
Ros Chapman.
4 • Outasite: Land Lease Communities Magazine Photo by Grace Saad Photography, Mid North Coast.
REVIEW OVERVIEW
At the end of 2020 the NSW issues we had raised with The Tenants’ Union meets
Government released the Government in regularly with senior staff at
the Discussion Paper on the stakeholder meetings and NSW Fair Trading and we have
Statutory Review of the through our 5 Year Report. been engaged in a number of
Residential (Land Lease) In our submission the discussions with them about
Communities Act 2013. Tenants’ Union emphasised complaints and compliance.
Individuals and organisations the need for a rebalancing We believe the current
were invited to provide feedback of fairness and power in the complaints process could
via a survey on the NSW Fair Act, which we believe can be improved and that a more
Trading website or by making a be brought about through transparent process should
submission. Consultation was improving operator education be developed. The Tenants’
initially scheduled to close on and conduct, and addressing Union would like to see a pro-
26/02/2021 but the deadline issues related to fees, charges active regulator that has the
was extended to 12/03/2021. and community rules. necessary tools to enable it
to monitor operator conduct,
The Tenants’ Union had been
preparing for the review by
Governance encourage improvement, and
consulting with home owners The way in which a take appropriate enforcement
and Tenant Advocates over community is operated action where necessary.
the preceding two years. We impacts all aspects of home
wanted to be certain we were owners’ lives from happiness Community Rules
fully informed and across the to financial wellbeing.
key issues of concern to home Throughout our consultation Also in Chapter 4, the
owners by the time the review with home owners, the Discussion Paper asked
came around. We published our behaviour of operators and questions about community
report 5 Years of the Residentialcommunity employees was rules. Those who live in land
(Land Lease) Communities Act raised as a major concern. We lease communities will be
2013 in August 2020 setting out heard everything from operators acutely aware that community
our key issues for reform and not understanding the law, rules can have a huge impact
recommendations for change. to allegations of disrespect, on the freedoms of residents
The Tenants’ Union would like bullying, harassment and yet they have little to no input
to thank all the home owners intimidation. The Discussion into the creation of those
who took the time to participate Paper asked five questions rules. The Tenants’ Union has
in our survey and those who about operator conduct and argued for a new rule-making
contributed through our forums education in Chapter 4, which process involving residents of
and meetings. Your views and facilitated focused feedback on the community, and for the Act
ideas are important to us and these very important issues. to enable rules to be set aside
are a valuable contribution to In our submission we if supported by a prescribed
the work we do. recommended an expansion percentage of residents. We
The Discussion Paper was of mandatory education also recommended that the
comprehensive, asking a total to all key personnel in the Act improve clarity around
of 76 questions about the Act operating company. This compliance requirements for
covering everything from the includes decision-makers and community rules, particularly
objectives to administration on-site employees engaged in in communities with both
and enforcement. We were the day-to-day operations of residential and holiday sites.
particularly pleased to see the community, dealing with
questions on all of the key resident queries and disputes. Continued on page 6...
Outasite: Land Lease Communities Magazine • 5
Continued from page 5...
fixed methods in recent site
Fees, charges and agreements ranging from
3.5% to 5.5% at a time when
affordability the Consumer Price Index
When it comes to money is very low. Ultimately, we
there is a great deal more to recommended that if fixed
consider and the Discussion methods are retained in the
Paper contained a number of Act home owners should
opportunities to comment on be given a choice of fixed
the financial arrangements method or increase by notice,
and obligations in the Act. The and a fixed method should
first, and most obvious, is site apply for no more than 12
fees and site fee increases. months (one increase) at
Chapter 3 asked questions which point it can be renewed,
about fixed method increases, renegotiated or the home
increases by notice, site fees in owner can move on to the
increase by notice method.
“I support the submission new agreements and voluntary
sharing arrangements. We also recommended that
by the Tenants’ Union the option of ‘other’ is
wholeheartedly. We Fixed method site removed so that methods like
the one at Kincumber Nautical
are lucky in NSW to fee increases Village are no longer possible.
have our own legislation Outasite and Outasite Lite
Site fee increases
readers will be aware of the
for administering land Tribunal decision regarding the by notice
lease communities, fixed method increase used at
Kincumber Nautical Village, and Through the review the
and an affordable the subsequent appeal of that Tenants’ Union has argued
process (NCAT) for decision by the operator (see for more transparency around
site fee increases by notice,
helping residents to also article on page 37 in this
clarity regarding the operating
Outasite). This dispute shone a
have their problems light on what can happen when expenses that can be included
in a site fee increase, and for
heard. If the legislation there is perceived ambiguity
the Tribunal to have complete
in a legislative provision and
is amended to address one party is willing to take discretion when considering
the shortcomings advantage of that, to the whether an increase is excessive.
detriment of the other party.
identified in the Fair market value
The Tenants’ Union struggled
submission, residents with the question of whether Again, our readers will be aware
and operators alike fixed method increases should that we consider the third
be permitted under the Act. We method of site fee increase to
will benefit and the job acknowledge a fixed method be the most significant and
of administering the provides certainty to home challenging issue. That is, the
owners but a percentage increases that occurs when a
legislation will be so increase that has effect home changes hands. We are
much easier for Fair for the duration of a site pleased to see a question
Trading and NCAT.” agreement can produce high on this point in the Discussion
increases not commensurate Paper. The Tenants’ Union
– Lynn Harvey, Secretary, with operating costs for the has rarely sighted a new site
Ingenia Lifestyle Lake Munmorah community. We are aware of agreement with site fees at
Residents Committee
Fair Market Value since the The Tenants’ Union made two for incoming home owners
Act commenced. Just at the further recommendations and places them in a better
time of writing this article, regarding arrangements that bargaining position if they
we received an email from benefit operators but provide choose to enter into a new site
an advocate in the Tweed little or no benefit to home agreement with the operator.
where a real estate agent is owners. We said that voluntary Termination provisions in the
questioning site fees in a new sharing arrangements and Act are generally appropriate
site agreement on behalf of special levy provisions should in our view, except section 127.
his client. The selling home be removed from the Act. It enables a site agreement to be
owner was paying $310.78 a terminated when the site is not
fortnight but site fees for the Utility charges lawfully useable for residential
prospective home owner are purposes, including when the site
The other big issue regarding
$382 a fortnight, an increase of is approved as a short-term
charges is of course utility
almost $72 or 23%. The operator site. An operator in the Illawarra
charges. This is particularly
advised the agent the increase
important for home owners who has recently issued termination
was because ‘the park has notices to all home owners in
are supplied with electricity
established a new market rent.’
through an embedded network. the community on the basis
The Tenants’ Union has met with it doesn’t have an approval
Maintaining the the Government three times as to operate under the Local
residential site part of the review and we have Government Act 1993 (see article
also held discussions with other on page 18 below). The Tenants’
Whilst not directly related to Union does not believe operators
key stakeholders specifically
financial arrangements or should be able to terminate
about electricity charges. It is a
obligations, another ambiguity
complex area but we are hopeful site agreements in these
in the Act has led to operators circumstances, where alternative
the Government will settle on a
transferring the costs of remedies are available.
charging method that is fair to
maintaining and repairing
both home owners and operators.
community infrastructure to What next?
home owners. The Act requires
an operator to provide a
The end of the The Government will consider
residential site in reasonable agreement the submissions and survey
condition and fit for habitation responses to determine
at the start of a site agreement. Chapter 6 of the Discussion whether and how the Act
However, it does not specify Paper covered issues such should be amended. It is
who should maintain and repair as interference with sales, likely there will be further
the site once the agreement assignment (transfer) of consultation with stakeholders
has started. We think the site agreements, sub-letting before the Government
answer is obvious – the and termination. settles on a final position
operator owns the site and The ability to assign a site regarding the changes.
the home owner leases it so the agreement is an important The Government has indicated
operator is responsible. right for home owners and changes to electricity charges
However, some operators have prospective home owners. will be fast-tracked so we will
used the lack of specificity to When a site agreement see those changes first.
make home owners responsible is assigned the incoming
for structural retaining walls, home owner moves into the Keep an eye on our website
slabs and driveways and community on the same terms tenants.org.au/thenoticeboard
subsidence. This issue was as the exiting home owner, or sign up for Outasite Lite email
covered in Chapter 4 of the including site fees. The right newsletter at tenants.org.au/
Discussion Paper (see also to assign a site agreement thenoticeboard/news to stay
article on page 14 below.) provides enhanced protections up to date with the review.
Outasite: Land Lease Communities Magazine • 7
RECKLESS RETALIATION?
The electricity charges saga continues.
Is the operator’s conduct retaliatory?
Many Outasite readers will know
the name Margaret Reckless.
She is the home owner whose
name was given to the method
to calculate electricity charges
for home owners on embedded
electricity networks because
Margaret’s dispute with her
operator went right up to the
Supreme Court of NSW. The
decision of the Supreme Court
on 4 September 2018 in Silva
Portfolios Pty Ltd trading as
Ballina Waterfront Village &
Tourist Park v Reckless [2018]
e
NSWSC 1343 defined the
illag
parameters for electricity
tV
charges. When the dispute
ron
went back to the NSW Civil
er f
and Administrative Tribunal
at
W
(NCAT) to determine exactly
llin
a
how the charges should be B a
at
calculated, the ‘Reckless’
o wn er
Marg
method was born. aret Reckless, home
In January 2019 we published
issue 33 of Outasite Lite (our Once all the proceedings was one of those operators
email newsletter) featuring had been finalised Margaret so, despite all Margaret’s
Margaret’s long battle for fair was looking forward to a efforts for a fairer price,
electricity charges under the rest. All she wanted was to she and all the other home
headline ‘Is it over?’. At that sit back and enjoy life in her owners in the community
time, Margaret thought it was. community. Unfortunately, were immediately facing large
She had battled the operator it appears the operator is price increases. Once again
for two years in the Tribunal, unwilling to let that happen. Margaret stood up for what
Appeal Panel and Supreme is right and refused to accept
Court. Her fight led to fairer In our 2020 issue of Outasite a transfer to Hum Energy.
electricity charges for all we reported that a number Margaret believes that it is
home owners on embedded of operators had outsourced important to take a stance on
networks, and provided a electricity supply within their issues of importance, but that
pathway for home owners to embedded networks to Hum doing so makes home owners
seek refunds for the amounts Energy following the ‘Reckless’ vulnerable to retaliatory
they had been overcharged. decision. Ballina Waterfront conduct from operators.
8 • Outasite: Land Lease Communities Magazine
“The operators have
never approached me
Retaliation? either in person or
me either in person or in
writing regarding anonymous
in writing regarding
Margaret has recently been
issued with a termination allegations and now they have anonymous allegations
notice for alleged breaches issued me with a termination and now they have
notice. The first Tribunal
of her site agreement, which
hearing was dismissed
issued me with a
she now has to defend at
the Tribunal. She believes the because they lodged it before termination notice.
termination notice is another the termination date stated
instance of retaliatory in the notice. They have now “Home owners in land
conduct by the operator, made a second Tribunal lease communities
which started when she application and the hearing need to take a
commenced proceedings is in July.
stand regarding this
regarding electricity charges.
“Home owners in land harassment and
Margaret told us: lease communities need to
take a stand regarding this
intimidation. Most of
“Most of my experiences
regarding bullying and harassment and intimidation. us are elderly and
harassment began when I Most of us are elderly and have a right to respect
started proceedings against have a right to respect which which is sadly lacking.
the operator regarding is sadly lacking. Operators
electricity charges, and it should be held accountable Operators should be
progressively worsened – not for their actions – there held accountable for
against me but my daughter should be protection built their actions – there
who also had a home in the into the Act. If a home owner
does the wrong thing, we are should be protection
community. The operator
was aware that she suffered held accountable, but if an built into the Act.
with mental health issues operator or manager is found
but that did not stop them in breach of their obligations “I have taken my
from pursuing her. After being nothing happens. Operators concerns to the
and their employees need
admitted to Lismore Hospital
to be evaluated regarding
local State Member
on suicide watch she had to
abandon her home and move whether they suitable to and requested
out. Eventually she found a hold their position within representation of
buyer for her property but at a the community. the Member to Fair
substantial financial loss to her.
“I have taken my concerns to Trading and the State
“The power of operators the local State Member and Government. Anyone
is absolute. Home owners requested representation of
have no rights. I have been the Member to Fair Trading
who has been subjected
accused of transgressions and the State Government. to unfair treatment,
in this community which are Anyone who has been bullying or harassment
allegedly on my file. Operators subjected to unfair treatment,
can put anything on our bullying or harassment by an
by an operator should
file without our knowledge operator should do the same. do the same. If the
or evidence of the alleged If the voices are loud enough, voices are loud
transgression. The operators we can make a difference and enough, we can make
have never approached regain our dignity.”
a difference and
regain our dignity.”
– Margaret Reckless, Ballina
Waterfront Village home owner
COMMUNITY BY
DEFINITION
By Emma McGuire, Tenant Advocate, Mid Coast Tenants Advice & Advocacy Service
In the vast majority of land
lease community cases that “In one particular
we encounter, it is generally
clear and accepted by all
community where
parties that there is a land we assisted
lease community in operation residents, there
and subsequently that the
Residential (Land Lease)
was no approval
Communities Act 2013 to operate of any
(RLLC Act) applies to the kind. We received
relationship between
operator and home owner.
a number of calls
In 2020 something a little
from residents
out of the ordinary came to being threatened
our attention. Our Service
ire
cG
u with arbitrary
encountered a number of M
permanent home owners Emm
a eviction.”
living in pop up communities
who were unsure of what In one particular community
a community without an
rights they might have and where we assisted residents,
approval to operate, the
what legislation applied to there was no approval
situation can be a precarious
their situation. An example to operate of any kind.
one. In some cases,
of these communities are We received a number of
council intervention and/or
homes established in a calls from residents being
termination of site agreements
number of showgrounds and threatened with arbitrary
can follow for home owners
similar multi-use community eviction and also from
in these communities (see
venues, amongst others. In concerned third parties. There
also ‘Local Government
some cases, the operator may was an escalation of events
Complications’ on page 14).
have received an approval to when some residents were
operate as primitive camping forcibly evicted from the
It is often the case that
grounds from the local council, community by the operator
residents in these types of
so really are only permitted to and with the assistance of
communities are extremely
cater for short-term tourists NSW Police. This occurred
vulnerable and may not have
and not long-term permanent without any orders from the
the ability to move or, if they
home owners. While in other NSW Civil and Administrative
do, have nowhere else to
cases there has been no Tribunal (NCAT). Of course,
go. They may not have any
approval to operate issued where the RLLC Act applies,
written agreement with the
of any kind under the Local a site agreement can only be
operator and may have little
Government Act 1993.
understanding of their rights or terminated in accordance with
For home owners who the complexities around relevant the Act and it is an offence
find themselves living in local government regulations. to recover possession of a
10 • Outasite: Land Lease Communities Magazinesite unless there is a warrant of the question ‘when is These factors demonstrated
issued by the Tribunal and a land lease community a land that there was a land lease
executed by the Sheriff’s lease community?’ The Act community in operation within
officers. However, the operator naturally provides guidance the meaning of the RLLC Act.
in this instance sought to deny on this issue. Section 5 states Further, they demonstrated
the application of the RLLC that the RLLC Act applies to ‘all the home owners in question
Act, including by asserting that communities’ and we can find had a site agreement under
because there was no approval the definition of ‘community’ or the Act and were protected
to operate, this was not a land ‘residential community’ under accordingly. For those living
lease community and as such section 4 of the Act. in such an uncertain situation,
they were able to evict Despite descriptions used by the Act’s protection can be the
residents at will. the operator in an attempt difference between a safe and
to categorise the place as secure home on one hand and
Helpfully though, section 5(c) potential eviction by police and
and the section 4 definition of something other than a
land lease community, the homelessness on the other.
‘community’ in the RLLC Act
specifically accounts for the community in this particular Overall, the question of
situation where a land lease case had many of the usual whether a land lease
community does not have an indicators you would expect. community exists and whether
approval to operate as required There was of course an area the RLLC Act applies is
under the Local Government of land (in this case owned always one of substance over
Act 1993. The RLLC Act makes by the operator). There were form. Regardless of how the
it clear that it captures and ‘sites’ (although in some cases operator may describe the
applies to all communities unmarked) where people community, how it may look
regardless of their compliance placed their homes (that term or present itself, or how
with local government is defined under section 4 of strongly the operator attempts
legislation and regardless the Act). Additionally, there to classify it as a different
of any descriptors used in was evidence of the operator arrangement which lies
relation to the community. This advertising the leasing of beyond the application of
approach is important to ensure sites and site fees were paid the Act, it is an objective
vulnerable home owners are fortnightly to the operator question to be answered by
not left without the protections in exchange for use of the the Tribunal. The Tribunal will
of the Act merely because an sites along with rudimentary always have regard to the
operator has failed to comply common facilities. definitions contained in the Act
with their obligations to obtain Also relevant was the fact that and the facts of each matter.
an approval from the relevant the home owners we assisted If in essence an operator is
Council before commencing lived in their homes in the leasing sites to people to place
to operate. community permanently and their homes on and live in
Our Service assisted some had done so for a number of permanently, then it is likely a
of the home owners in this years. They had no principal land lease community is in
situation to apply to the place of residence other than existence. With respect to
Tribunal for an order under in the community. There issues which may arise such
section 9 of the RLLC Act was also no restriction, ever as non-compliance with local
declaring that there was a indicated or enforced, on government legislation, a
community to which the Act how long the home owners failure to be included in NSW
applied and also that there could live in their homes Fair Trading’s Register, or other
was an oral site agreement in for any stretch of time (and regulatory issues – these
force between the parties. therefore this was clearly failures cannot be relied on
not an agreement under the by an operator as a means
The proceedings before the Holiday Parks (Long-term Casual of evading the application
Tribunal involved consideration Occupation) Act 2002.) of the RLLC Act.
Outasite: Land Lease Communities Magazine • 11DAMAGE, LOSS AND
ABANDONMENT
By Emma McGuire, Tenant Advocate, Mid Coast Tenants Advice & Advocacy Service
In an overwhelming majority installed), home owners place
A number of land lease of cases, a home owner’s a significant reliance on being
site agreement is terminated able to sell their home on-
communities were following the sale of the home site as a means of recouping
impacted by the floods after possession is given over (or growing) their financial
in the Mid North to the purchaser. The Residential investment in their home, and
(Land Lease) Communities Act also as a means of bringing
Coast in March 2021. 2013 reflects the importance their site agreement to an end.
of the home owner’s right to
Some homes in those sell by providing strong rights There are a variety of
circumstances, however, where
communities were to sell the home on-site and
a home owner is not able to
a prohibition against
significantly damaged operators interfering with sell their home and as a result
by flood waters, leaving the sale of a home. can face limited and difficult
options regarding how to
home owners unable Due to the fragile nature of end their site agreement and
to sell their homes to many homes and the expense what to do with their home.
involved in moving them Homes which are significantly
incoming prospective (along with the difficulties damaged or dilapidated or
purchasers. in finding vacant sites on otherwise unsellable for
which the home could be some other reason can cause
Flooding at a Mid North Coast land lease community in 2021. Photo by Emma McGuire.
12 • Outasite: Land Lease Communities MagazineFlooding at a Mid North Coast land lease community in 2021. Photo by Emma McGuire.
significant stress and hardship now required to be dealt home owner (the home owner in
for home owners. We have with in accordance with the that case did not attend Tribunal
seen these types of issues Uncollected Goods Act 1995. and the matter was heard in
arise most recently in relation The rights and obligations of their absence.) In a contrasting
to the March 2021 floods the operator in dealing with and matter, one which demonstrates
across the Mid North Coast, disposing of homes under that a sympathetic and more
where a number of land lease Act will vary depending on the collaborative approach, one
communities were impacted value of the home itself. For operator, in consultation with
by the natural disaster. Some example, a home worth more the home owner, covered all of
homes in those communities than $20,000 can only be dealt the costs associated with the
were significantly damaged with in accordance with an demolition and disposal of a
by flood waters, leaving order of the Tribunal, whereas dilapidated home which it was
home owners unable to sell a home worth equal to or more agreed could not be sold and in
their homes to incoming than $1,000 but less than circumstances where the home
prospective purchasers (home $20,000 can be disposed of by owner was unable to return to
owners) as would ordinarily the operator by way of public the home for health reasons.
occur. In some of these auction or private sale without That approach resulted in
situations the only practical an order from the Tribunal. arguably the best outcome
choice for home owners may be for all parties involved.
We have seen cases where the
to either sell to the operator for
Tribunal has made an order Issues around damaged
what would likely be a nominal
authorising an operator to and dilapidated homes,
amount, or alternatively simply
demolish and remove the home abandonment & termination of
abandon their home on the site
of a home owner who was held site agreements can be complex.
and leave the community.
to have abandoned their ageing As such, it is important for
Homes that are abandoned home on the site, with the home owners to seek advice
(which is something the operator permitted to recover from their local Tenants Advice
Tribunal can determine the costs associated with the & Advocacy Service should
under s 142 of the Act) are demolition and removal from the these matters arise.
Outasite: Land Lease Communities Magazine • 13UNSTABLE GROUND
Land lease living is often Additionally the LLIA website the Tweed area contacted the
talked about as an affordable advises potential home owners operator regarding subsidence
housing option, particularly they don’t have to buy the land issues on the site she was
for retirees who want to – “You buy a new or established leasing. She had contracted
downsize and free up funds. house within a secure a building consultant to carry
New, modern homes can be community and instead of out an inspection of her
expensive but, when compared buying the land you pay a weekly home and site and his report
to the cost of traditional or fortnightly site fee to lease confirmed there had been
house and land options, even the land where your house is”. some soil settlement on the
the top end homes are often site that had caused damage to
All of this is true and these are
cheaper. Other contributors to the home including cracks to
some of the reasons people
affordability include the ability walls and door frames and
choose land lease living. The
to claim Commonwealth Rent significant sloping of floors
question we have is: if you
Assistance to help meet the inside the home and on the
are not the landowner, how
cost of site fees, no stamp duty verandah. The home owner
can you be responsible for
is payable when purchasing asked the operator to “kindly
fixing problems such as soil
a home, and home owners make arrangements to
or ground subsidence and
do not have to pay council rates. rectify the issues”.
structural retaining walls? The
Information on the Land Lease short and obvious answer is The operators’ response
Industry Association of NSW that you are not, but that is not came in the form of a letter
(LLIA) website focuses heavily the experience of a growing from a solicitor advising the
on the affordability aspect number of home owners who home owner that she had
spruiking “the opportunity are facing large bills to fix been advised previously “that
to downsize the home while problems with the land under subsidence was a matter for
supersizing the lifestyle”, the or around their homes. you to deal with”.
ability to “enjoy all the facilities
and services without any of the Subsidence Home owners in another
community, owned and
work to maintain them” and “the operated by Hometown
Simply defined, subsidence
opportunity to release funds Australia, have been dealing
is a downward shifting of
tied up in the family home to with similar problems. In
ground. It may occur as a
fund a retirement lifestyle September 2020 they noticed
result of water erosion, tree
free of financial insecurity”. that subsidence was occurring
roots and other vegetation, or
a failure to properly compact to the ground surface beneath
the ground to create stable their home. They wrote to the
footings. Whatever the cause, operator and asked for an
The question we have the outcome is the same – the urgent response to subsidence
is: if you are not the home sitting on land that is issues occurring on the site.
landowner, how can subsiding will be impacted. The home owners spoke
Those impacts may include
you be responsible walls bowing and cracking,
with Ms Lauren Toussaint
for Hometown in October
for fixing problems door frames detaching from 2020 and the operators’
such as soil or walls or cracking, and floors position was that further
moving and sloping.
ground subsidence consideration was required to
In mid-2020 a home owner ‘determine responsibility’ for
and structural in a land lease community in the subsidence occurring on
retaining walls?site. The matter dragged on for
another month and it became
clear to the home owners that
the operator was not going to
rectify the subsidence problems
and was avoiding responsibility.
The ground surrounding and
below the central footing had
subsided by up to 150mm
over an area of approximately
1 metre in diameter.
The home owners applied
to the Tribunal. Hometown
instructed a geo technical
engineering company to
prepare an expert report for
the Tribunal proceedings. The
expert report confirmed that
ground soil subsidence had
occurred, however the focus of
the report was placed primarily
on some footings of the home
‘no longer supporting the steel
beam bearers’. The home
owners could not afford the
exorbitant cost of obtaining an
expert written report and whilst
the Tribunal noted in a Notice
of Order in April 2021 that the
core issue for determination
is the cause of subsidence
under the site, the proceedings
became too stressful for the
home owners and they decided
to withdraw their application Stress cracks in the walls of a land lease community home –
prior to the hearing. caused by subsidence in the site.
The operators’ written
community that can be seen in became concerned when a
submission to the Tribunal
carports, yards and in common sink hole appeared on the site
included an assertion that the
areas. I’ve spoken with another he rents, affecting three of the
footings to the home are 8 his home. Mark
home owner, a retired architect, piers supporting
the cause of the subsidence
and he’s aware of some approached the community
and recommended that the
subsidence under his home.” operator for assistance. The
footings be designed to suit
operator responded by telling
the subgrade. The home owner In March 2021 Brigadoon
Mark he had 90 8 days to remove
says, “the subsidence came Holiday Park at North Haven
his home, at his own expense, if
first, the footings did not fail became flooded following
the site is to be repaired. Mark
until such time as the site a huge storm that affected
told us “I have always been
subsidence occurred. There are much of the mid north coast
a good tenant and nobody
other instances of significant of NSW. Mark, a home owner
subsidence around the at the community for 16 years Continued on page 16...
Outasite: Land Lease Communities Magazine • 15Continued from page 15... apart. They asked the operator to any hardscape (for example
who was responsible for the concrete slabs) or landscape on
deserves to be treated like
wall but it wasn’t until after they the site; and
I have been treated since I
had paid the deposit for the 58.2 that any plumbing or wiring
raised this problem”.
home the operator responded that connects your dwelling or
Structural integrity and advised they (the home
owners) were responsible. By
any of your structures to the
utility services provided by the
Structural integrity is about the that time it was too late to pull residential community is your
ability of a structure to hold out of the sale without losing property; and
together under a load without their deposit so the (now) 58.3 that any item identified in cl.
breaking, or excessively home owners sought quotes 58.1 or 58.2 are your responsibility
distorting. It’s about the structure for the repairs, which ranged to maintain in a condition
being able to perform the function between $10,000 and $12,980. satisfactory to us, having regard
for which it was designed. The home owners wrote to the to their condition at the time
There are numerous structures operator and suggested they they were installed on the site.”
within land lease communities had failed in their obligation Not only does this term
with a clear delineation between to provide the residential site purport to transfer ownership
those owned by the operator in reasonable condition at of site infrastructure from
and those owned by home the commencement of the the operator to home owner,
owners. We think it’s fair to say site agreement. The operator the home owner is then
that the owner of a structure rejected this claim saying there additionally required to
is the person responsible for are no immediate safety issues maintain that infrastructure
maintaining the structure to and that the wall has “moved/ to the standard determined
ensure that it is fit for purpose. bowed most probably as a by the operator. This is done
However, some operators and result of settlement of the site without reference to the time
the LLIA see things differently. after the wall was built”. it was installed on the site,
A number of home owners have While there may not be an regardless of how long ago
contacted the Tenants’ Union immediate concern in this that was, or even the actual
regarding responsibility for case, there is a concern that condition at the time the home
structural retaining walls. down the track this wall will owner entered into the site
In all cases these walls are need to be replaced, and that agreement. The question is
essential to the integrity of the it is the home owners who will whether this term is valid, or
site i.e. they stop it collapsing, have to foot the bill. Despite whether it is an attempt to
and all are made from wood. the statements on the LLIA contract out of the Residential
When home owners have website that home owners only (Land Lease) Communities Act.
approached operators with lease the land and can enjoy all The Act is silent on whose
concerns the walls are the facilities without the any of responsibility it is to maintain
deteriorating and may no the work to maintain them, the a residential site, or what
longer be doing the job for 2017 site agreement provided by structures form part of the
which they were designed, the the LLIA for use by its members site. However, the standard
home owners have been told (community operators) contains form condition report in
fixing or replacing the walls is the following additional term: the Residential (Land Lease)
their responsibility. “Acknowledgement of your Communities Regulation 2015
property provides some clarity. It states
In November 2020 prospective
home owners were viewing a You agree “This form is only for use in
home in a community on the 58.1 that any dwelling, associated relation to a residential site and
Central Coast when they noticed structure, shed, driveway, pathway, not the home or any fixtures
a structural retaining wall looked retaining wall or any structure or on the site”. In the section
like it was starting to come fixture including but not limited “condition of the residential
16 • Outasite: Land Lease Communities MagazineAbove: Mark’s home.
Right: Underneath Mark’s home you can see the
separation distance between the sinking pier and
the support beam for the home. Also visible is fill
dumped by the operator while Mark was out.
site” which is to be completed by
the operator and home owner the
items listed are: landscaping/garden;
driveway; lawn; site slab (concrete). It
is clear from this that the slab, driveway,
and other items that are not fixtures, Mark has been a home owner in the
are part of the residential site. community for 16 years. He became
The Tenants’ Union believes the concerned when a sink hole appeared on
Act needs to provide greater clarity the site he rents, affecting three of the piers
regarding an operator’s responsibility
to maintain community infrastructure
supporting his home. Mark approached the
including residential sites and that the community operator for assistance. The
transfer of ownership and responsibility operator responded by telling Mark he had
for maintenance of structures such
as slabs and structural retaining walls 90 days to remove his home, at his own
should be prohibited. Only then can expense if the site is to be repaired. Mark
home owners be certain that when told us “I have always been a good tenant
they purchase the home, they are free
to enjoy a “retirement lifestyle free of and nobody deserves to be treated like I have
financial insecurity.” been treated since I raised this problem.”
Outasite: Land Lease Communities Magazine • 17LOCAL GOVERNMENT
COMPLICATIONS
Roles, responsibilities, compliance
It was difficult to know where Caravan Parks, Camping working with the operator,
to start this article because the Grounds and Moveable requiring action to address
list of issues surrounding the Dwellings) Regulation 2005 (the the issues of safety and non-
interaction of local councils Regulation) is made under the compliance. The problem is
and local government LG Act and it provides that that over this seven year period
regulations with land lease the council must not grant an the compliance problems had
community operators and approval to operate a caravan become extensive.
home owners is long. To bring park or manufactured home
WCC inspected the community
some of these issues into estate unless it is satisfied that
and produced a report setting
focus we have decided to it will be designed, constructed,
out a list of issues to be
highlight the plight of home maintained and operated in
addressed before the operator
owners in four land lease accordance with the relevant
could be issued with a new
communities in the Illawarra. requirements of the Regulation.
approval to operate. These
All of these communities are Compliance with the Regulation
issues are not restricted to the
within the Wollongong local is the issue impacting home
operator – according to
government area. owners in the four communities
council, almost every site
in the Illawarra.
Approval to operate at Figtree Gardens contains at
least one structure that is in
The Local Government Act 1993
Figtree Gardens some way non-compliant.
(LG Act) provides the legal This has raised a number of
Figtree Gardens Caravan
framework for the system concerns for affected home
Park sits in the Wollongong
of local government in NSW. owners, many of whom bought
suburb of Figtree. It has
Amongst other things the Act their homes as they currently
200 residential sites
sets out the responsibilities stand, on-site.
accommodating 380 residents.
and powers of councils and Figtree Gardens operated There has been debate
councillors. Section 68 of without an approval for over about WCC’s interpretation
the LG Act prohibits certain seven years before Wollongong of some separation distance
activities from being carried City Council (WCC) started requirements and their
out without the prior approval
of the council and those At Figtree Gardens,
activities include operating a many home owners
caravan park and operating a feel they are now
manufactured home estate. being asked to pay
Although the terminology to fix problems
is outdated, section 68 that arose because
essentially requires all land Wollongong City
lease community operators to Council and the
hold an approval to operate. operator failed
to meet their
The Local Government obligations over a
(Manufactured Home Estates, number of years.
18 • Outasite: Land Lease Communities MagazineOasis Caravan
approach to the compliance Park does not have
problems at Figtree. Many a current approval
home owners feel they are to operate, and has
now being asked to pay to fix not had one since
problems that arose because 2006 when the
WCC and the operator failed last one expired.
to meet their obligations over
Rather than dealing
a number of years. Not only
with the compliance
do home owners believe this
issues, the operator
is unfair, the costs associated
has issued all home
with making a site compliant
owners with 90 day
could be significant and some
termination notices.
home owners simply do not
have the money. This action has
Currently there appears to placed the home
be a stalemate at Figtree. owners in a very
WCC issued a restricted precarious position
conditional approval to operate and highlighted
in December 2018 subject to a major flaw in
the completion of a staged the legislation.
program of works. In order
to obtain an unconditional than dealing with compliance before issuing a termination
approval the compliance issues, the operator has issued notice, for example, obtaining
issues need to be addressed. all home owners with 90 day development consent
The operator can and should termination notices under if it is required, or being
do what council is requiring section 127 of the Residential authorised by the Tribunal.
of them, but making all of the (Land Lease) Communities Act The termination notice must
sites compliant is not going 2013 (RLLC Act) on the basis give a home owner at least 12
to be easy, and at present the sites are not lawfully months to vacate the site, and
it appears there is no clear useable for the purposes of a the operator is required to pay
pathway to ensure it happens. residential site. This action has compensation to the home
placed the home owners in a owner prior to them vacating
Oasis very precarious position and
highlighted a major flaw in land
the community.
The operator of Oasis Caravan
lease community legislation.
South of Figtree, Oasis Caravan Park has indicated the
Park sits on the eastern shore The Act is supposed to provide community will be closing but,
of Lake Illawarra. It has around enhanced protection for home rather than follow the process
43 sites and 55 residents. owners against termination set out in section 124 of the
Oasis does not have a current because of the significant Act, it is using section 127
approval to operate, and has investment home owners which affords home owners
not had one since 31 August make to live in a community. less time to vacate and could
2006 when the last one expired. Sections 124 and 125 enable leave some without a right to
Like Figtree Gardens, there an operator to issue a home compensation.
are a number of compliance owner with a termination
Home owners at Oasis are
issues that WCC have advised notice when a community
covered by the RLLC Act
must be addressed in order for is going to close, or when a
because it applies whether
a new approval to be issued. residential site is to be used
or not the community has an
However, unlike Figtree, the for a different purpose. Both
approval to operate under the
operator of Oasis appears not circumstances require the
to want a new approval. Rather operator to take certain steps Continued on page 20...
Outasite: Land Lease Communities Magazine • 19“We’d like to work with
Council and come
to an agreement.
We’re willing to make
reasonable changes,
but some of the
nd s
demands they are
kla
making are impossible
Oa
to comply with.”
le
ty
f
es
y Li – Jean, resident at Gateway
a
atew Lifestyle Oaklands
G
ner at
w
Jean, home o
Continued from page 19...
Service (PAVS) raised concerns the rights of some to seek
Local Government Act. The that certain provisions compensation when their site
question is whether the lack of weakened security of tenure agreement is terminated.
a current approval to operate for home owners. PAVS were
shouted down and accused If home owners at Oasis
makes the sites unlawful. If it
of misleading residents and have their site agreements
does, the home owners’ site
wilfully misinterpreting the Act. terminated in these
agreements can be terminated.
Unfortunately for a number of circumstances, the Act will
When the draft Residential home owners, including those have failed them. It will be a
(Land Lease) Communities Bill at Oasis, the Act has weakened double and devastating blow
was released for consultation security of tenure for home to those who do not have a
in 2013 the Park and Village owners and undermined right to compensation. The
20 • Outasite: Land Lease Communities MagazineAt Jettys By the Lake, home owners were recently advised that within five years they will need to raise their
homes to three metres above sea level because of the predicted flood level for 2050. Now they’re questioning
how the condition can be met and, if homes can be raised, who will pay? Photos by Jeremy Kerbel
majority of these home owners
are pensioners with no assets
Jean and Ralph bought
their home at Oaklands in
Jettys By The Lake
other than their home in the 1993. They purchased the Between Oaklands and
community. This course of home from the operator who Oasis is Jettys By the Lake.
action should simply not installed it on the site and It has approximately 180
be available to a land lease it has not been moved or residential sites occupied by
community operator. added to since that time. In 284 residents. Home owners
a report authored by WCC at Jettys are facing a different
Gateway Lifestyle in April 2020 Jean and Ralph issue – they were recently
discovered their home is too
Oaklands close to an access road and is
advised that within five years
they will need to raise their
therefore not compliant with homes to three metres above
Further south, also on the the Regulation. The home
shore of Lake Illawarra is a sea level because of the
cannot be moved and they, predicted flood level for 2050.
community known locally as like many other home owners
Oaklands. It has 245 residential at Oaklands, don’t understand This requirement came out
sites and is home to around 370 how something that has of an agreement made in
residents. The community has been in place since 1993 only a conciliation conference
been operating as a land lease became an issue in 2020. arranged by the Land and
community since the beginning Environment Court between
of the 1990s. On 31 August Jean says, “We’d like to the operator and WCC on 27
2019 the approval to operate work with Council and come November 2020. The operator
expired and when the operator to an agreement. We’re has said they felt they had
applied to WCC for a renewal willing to make reasonable little choice but to accept
it was declined because of changes, but some of the the condition as it became
issues of non-compliance demands they are making are
with the Regulation. impossible to comply with.” Continued on page 22...
Outasite: Land Lease Communities Magazine • 21You can also read
