Improving the governance of residential parks Discussion Paper

Published by:

NSW FAIR TRADING PO Box 972 PARRAMATTA NSW 2124

Tel. 13 32 20 © NSW Fair Trading 2011

This publication is copyright. It may be reproduced in whole or in part for study or training purposes subject to the inclusion of an acknowledgment of the source. It may not be reproduced for commercial use or sale. Reproduction for purposes other than those indicated above requires written permission from NSW Fair Trading. Disclaimer

Because this publication avoids the use of legal language, information about the law may have been summarised or expressed in general statements. This information should not be relied upon as a substitute for professional legal advice or reference to the actual legislation. Acknowledgments

Cover photo reproduced with permission from Consumer Affairs Victoria. Further copies of this document can be downloaded from the NSW Fair Trading website www.fairtrading.nsw.gov.au November 2011

“Minister’s Message”

Residential Parks are an important part of the housing mix across New South Wales. They provide an affordable housing choice for many people, who develop strong networks of support within their park that they value highly. Yet for too many owners and residents the current law is confusing, cumbersome and too often leads to conflict.

The NSW Liberals & Nationals Government gave an election commitment to improve the governance of residential parks and to strengthen the residential park industry. The release of this discussion paper honours that commitment and provides an opportunity for park owners, residents, advocacy groups and others to contribute to improving the legal framework which governs residential parks. The NSW Government wants broad community input to ensure that the law in this area takes a balanced approach that provides appropriate protections for park residents while also recognising the legitimate interests of park owners to develop and sustain efficient and effective business operations. I encourage you to take this opportunity to have your say, whether it is on all the matters raised in this discussion paper or on one or two issues of particular interest to you. All submissions received will be given careful consideration. I look forward to your contributions.

Anthony Roberts MP Minister for Fair Trading

CONTENTS

INTRODUCTION .............................................................................................1

Background to this review ............................................................................1 Purpose of the discussion paper ..................................................................1 How to have your say...................................................................................1 Next steps ....................................................................................................2

HISTORY OF REGULATION IN NSW.............................................................3

KEY ISSUE 1: LICENSING OF PARK OPERATORS......................................4

KEY ISSUE 2: EDUCATION OF NEW OPERATORS .....................................7

KEY ISSUE 3: RENT INCREASES..................................................................9

IMPROVED DISCLOSURE ...........................................................................14

DISPUTE RESOLUTION MECHANISMS......................................................15

PARK RULES ................................................................................................17

SALE OF DWELLINGS..................................................................................19

SECURITY OF TENURE ...............................................................................21

GREATER SIMPLICITY AND CLARITY ........................................................23

EMERGING ISSUES .....................................................................................26

REFERENCE MATERIAL..............................................................................29

MATTERS NOT COVERED BY THIS PAPER...............................................29

APPENDEX A: CONSULTATION SUBMISSION FORM

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Introduction

Background to this review The NSW Government gave a pre-election commitment to improve the governance of residential parks and to strengthen the residential park industry. The commitment included 3 key issues:

1. Introducing a system of licensing of park operators,

2. Mandatory education of new operators, 3. Improving the process for the resolution of

‘excessive rent increase’ applications. At the same time the NSW Government committed to undertaking a thorough review of the Residential Parks Act 1998 and associated Regulations. Purpose of the discussion paper The purpose of this paper is to guide discussion of the current laws for residential parks, the need for change and possible models of reform. The NSW Government is seeking comments on the issues raised and options presented in this discussion paper. Previous correspondence and complaints received by NSW Fair Trading, relevant decisions from the Consumer, Trader and Tenancy Tribunal (the Tribunal) and the approach taken to issues by interstate and overseas jurisdictions were looked at in preparing this paper. The Minister also met with key stakeholder groups to ensure their major issues of concern and ideas for change are reflected in the discussion paper. How to have your say You are invited to read this discussion paper and provide comments. To assist you in making a submission an optional submission form is provided at Appendix A and is also available online at www.fairtrading.nsw.gov.au However, this form is not compulsory and submissions can be in any written format.

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You may wish to comment on only one or two matters of particular personal interest or all of the issues raised in this discussion paper.

We would prefer to receive submissions by email to: policy@services.nsw.gov.au

You can also send submissions by fax to 02 9338 8918, or by mail to:

Residential Parks Act Review Fair Trading Policy PO Box 972 PARRAMATTA NSW 2124

Please take careful note of the deadline for submissions:

Submissions close at 5pm on 29 February 2012.

Submissions will not be made public except as required by law. All submissions may be made publicly available under the Government Information (Public Access) Act 2009 or for other purposes. If you do not want your personal details released, please indicate this clearly in your submission. Next steps All submissions received will be acknowledged.

Once the submission period has closed, feedback will be analysed and all potential options assessed. Preferred options for reform will be selected based on the following criteria:

• Cost benefits: will any change provide more benefits than the costs involved?

• Efficiency: will any change result in greater consistency, clarity and certainty in the law leading to fewer disputes?

• Effectiveness: Will any change strengthen the industry, adequately protect residents and meet the Government’s policy objectives now and in the future?

Options will be considered with reference to the NSW Government’s better regulation principles, as set out in the Guide to Better Regulation (Better Regulation Office, November 2009). It is anticipated that NSW Fair Trading will make recommendations on the most appropriate way forward to the NSW Government for consideration in mid 2012. More information about the progress of the review will be made available from time to time on Fair Trading’s website at www.fairtrading.nsw.gov.au

important

Submissions close on

29 February 2012

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HISTORY OF REGULATION IN NSW

The regulation of residential parks has come a long way since permanent living in parks was first legally recognised just 25 years ago. This is a timeline of the major events.

1986 Local Government Ordinance No. 71 was introduced, which made it legal to live permanently in a residential park.

1987* Permanent occupation arrangements in parks initially came under the Residential Tenancies Act 1987. Park residents had similar rights to tenants of ordinary premises.

1991* The Residential Tenancies Act was amended to give the Tribunal powers to resolve disputes over park rules.

1992 NSW became the first jurisdiction anywhere in Australia to introduce specific legislation for the parks industry, in the form of a mandatory Caravan and Relocatable Home Park Industry Code of Practice under the Fair Trading Act.

1994* Amendments were made to the Residential Tenancies Act to recognise for the first time that residents of parks who owned their dwelling required greater protection than residents who were renting both the dwelling and the site.

1995 Ordinance 71 was replaced by the Local Government (Caravan Parks, Camping Grounds and Moveable Dwellings) Regulation.

The Residential Tenancies (Moveable Dwellings) Regulation was also introduced to separate the standard agreements and some other provisions from the tenancy laws.

1998* Coverage under the tenancy laws ceased with the introduction of the Residential Parks Act. Queensland, South Australia and Western Australia subsequently followed the NSW lead by introducing separate legislation for residential parks.

2002* The Holiday Parks (Long-term Casual Occupation) Act was introduced, setting out the law in cases where dwellings are left on a site but only used for holiday purposes.

2005* A range of amendments were made to the Residential Parks Act following a statutory review. These reforms included changes to rent increases, compensation payments for relocation, improved disclosure and residents committees. The Local Government Regulation was remade.

2006 The Residential Parks Regulation was remade.

2011 The Residential Parks Act was amended in order to create a register of all residential parks in New South Wales.

* year Act was passed

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Key Issue 1: Licensing of park operators

Presently, anybody can be a residential park owner or manager. There is no requirement to hold any qualifications or have any experience to become one.

The majority of park owners do the right thing, treat residents fairly and comply with their legal obligations. However, on occasions residents have voiced concerns over certain park operators harassing, intimidating and acting unconscionably towards them. It is in response to these claims that some stakeholders have called for a system of licensing to be introduced. Licensing is seen as an effective way of ensuring that park operators meet standards, of building confidence in the industry and providing a method of redress against rogue operators. Licensing has the benefit of enabling stakeholders to keep track of who is working in the industry and what their record has been like. A system of licensing also allows government to deal with unacceptable conduct, with options including fines, mandatory training and as a last resort, expulsion from the industry. Option 1 – full licensing One option would be to licence residential park operators in a similar manner to real estate agents and strata managers under the Property, Stock and Business Agents Act 2002. New operators would need to obtain a licence before opening a residential park. Educational qualifications could be a requirement before such licences were granted. Licensing under the Property, Stock and Business Agents Act would bring park operators under the Rules of Conduct set out in that legislation. Prospective residents would be able to check the record of operators, including any action for past offences, on the NSW Fair Trading website. A system of full licensing would however, impose costs on operators which would most likely be passed onto residents. All existing operators would need to be given licences to ensure parks continued to operate without going through the normal assessment process, giving them an advantage over future entrants to the industry. Some of the support for licensing park operators is because other people, such as real estate agents and strata managers, have to be licensed. However, unlike real estate agents and strata managers, park operators do not hold money on behalf of residents. The money paid by residents to operators are debts, for example, rent and utility payments. The need for a licence to protect funds is not an issue in residential parks.

A system of full licensing would however, impose costs on operators which would most likely be passed onto residents

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The licensing of professions is now a national responsibility. No other State or Territory in Australia requires the licensing of residential park operators. Licensing systems do exist, however, in some overseas jurisdictions, such as in the United States. In considering a system of full licensing it should be remembered that operators commonly own the land on which residents’ dwellings are placed. Revoking or placing restrictions on a park operator who is not meeting licensing requirements could have adverse consequences for residents if services could no longer be provided or if the park needed to close. The ongoing relationship park operators have with residents is a further distinction from other licence categories, such as real estate agents and strata managers.

new register of residential parks One of the reasons given for calls to introduce licensing in the past was a need for stakeholders to know where residential parks are located and to keep track of who is running them. This has been resolved by recent changes made to the Act, in September 2011, to establish a register of residential parks. NSW Fair Trading now has accurate and detailed information about each residential park across the State.

Each park must also have an Approval to Operate as provided for in the Local Government (Manufactured Home Estates, Caravan Parks, Camping Grounds and Moveable Dwellings) Regulation 2005. An Approval to Operate, unless otherwise specified by the Local Council, must be renewed every 5 years.

Option 2 – negative licensing While the new register and approvals to operate address the issue of determining who is in the industry, they do not address concerns about the behaviour of those involved. Some residents claim that they are reluctant to take action against their operators for fear of possible harassment and intimidation, the threat of eviction or the operator retaliating through raising the rent or by some other means. One option could be for the Act to contain a stepped series of sanctions against park operators who fail to comply with their obligations. This could include:

• warning letters for first offences; • more penalty notice provisions; • larger fines, particularly for repeat offenders; • public naming and shaming of those operators

with the most complaints each year; or • restrictions, such as not being involved in sales

or not being able to open new parks or sites.

Has the establishment of a register of residential parks reduced the need for a full licensing system?

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Park operators who repeatedly commit serious offences could be required to appoint a park manager to handle the day to day management of the park, for a period of time, without any interference. This could address the behaviour issues with minimal impact on the residents living in the park. A similar provision enabling the Commissioner for Fair Trading to direct a landlord to employ an agent to manage their property was part of the recent tenancy law changes. Another option is to adopt provisions similar to section 57 of the Retirement Villages Act 1999, which prohibits certain persons from being involved in the management or control of a retirement village if, during the last 5 years, they have:

• been convicted of an offence involving physical violence to another person; or

• been convicted of an offence involving fraud or dishonesty; or

• become bankrupt or insolvent or been the director of a company which has been wound up (otherwise than voluntarily).

The Retirement Villages Act also contains a specific obligation on operators to use their best endeavours to ensure that each resident lives in an environment free from harassment and intimidation. Both Victoria and Queensland contain similar provisions against threats, intimidation and coercion by park operators. A further option could be for the Act to set out a Code of Conduct for park operators covering such matters as unconscionable conduct, conflict of interest and not interfering with the right of residents to quiet enjoyment. role of industry Complementing any system of licensing which may be introduced, the industry could play an increased role in improving standards and professionalism. There is already in place a voluntary national accreditation program run by the CRVA that provides an important industry based quality assurance opportunity for park operators (see www.accreditedcaravanparks.com.au for more details). Accreditation provides consumers and the industry with an assurance that a park operator is committed to quality business practices and professionalism. It encourages the review of current procedures and developing new ones which are more efficient and cost effective. Therefore, more incentives could be given to accredited parks or all parks could be required to be accredited within a certain period of time. Which option of licensing for park operators do you support and why?

A further option could be for the Act to set out a Code of Conduct for park operators

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Key Issue 2: Education of park operators A number of stakeholders have identified the need for more training to improve the quality of management within residential parks. Park operators need to know their rights and responsibilities and have the skills to deal with the difficult role of operating a residential park. A clear understanding of the rules helps to prevent conflict by resolving many disputes before they escalate. existing training providers Training for prospective park owners/managers and staff is currently available but is voluntary.

A five day intensive orientation course in park management is offered by the Australian Caravan Park Training School, based at the BIG4 North Star Holiday Resort in Hastings Point. The orientation program is accredited by the Australian Skills Quality Authority. The Training School also offers a second week of training covering practical caravan park involvement.

A Certificate IV course and a Diploma in caravan park management are available through Tubal Pty Ltd and some TAFE centres. The Caravan and Camping Industry Association also conducts training and seminars for its members through regional meetings and other methods. continuing professional development One of the features of the licensing system for strata managers and real estate agents is a requirement for continuing professional development. These requirements are aimed at maximising consumer protection outcomes, maintaining public confidence and reducing disputes. In particular, the requirements aim at the long term upgrading of professionalism and performance by:

• improving knowledge, skills and practice across industry in identified areas of marketplace concern; and

• maintaining or improving levels of competence, customer service and business management skills in the industry as a whole.

How it works is that each licence holder must show they have gained enough points (commonly 12) by attending relevant training courses, seminars etc when renewing their licence.

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Therefore, one option to strengthen the quality of management within residential parks is to introduce some form of mandatory education for operators. Whether this is connected to a system of licensing is a separate issue, as the two are not necessarily linked. The requirements could be tied into the existing educational services mentioned above, if they are seen as adequate. However, they may not be available state-wide or may be seen as too heavily targeted towards the tourist and holiday sector of the industry. Alternatively, existing courses could be expanded or new ones developed in consultation with industry, resident groups and training providers. Areas the education could focus on could include:

• familiarisation with relevant legislation; • basic financial bookkeeping and budgeting; • communication and dispute resolution skills; • awareness of the needs of park residents; • ethics and professional responsibility; and • health and safety issues.

A system of either mandatory or voluntary education could be supported by NSW Fair Trading through seminars, newsletters and an improved website.

who needs to be educated? If some form of mandatory education is to be introduced, the next question is who it should apply to.

In a park you could have one or more of the following: • a park owner who owns the land on which the

park is located but who is not involved in the day to day management of the park;

• a park owner who owns and manages the park (i.e. the park operator);

• a park manager employed by the park owner to manage the park on their behalf; and

• office staff, other than the owner or manager, who have direct contact with residents.

Whether one, a combination or all of the above should be subject to any mandatory education requirements is one issue. A further issue is whether any mandatory education requirements should apply only to new persons entering the industry or whether they should be phased in for existing persons, with due recognition for experience and training previously undergone. Do you think mandatory education of park operators will improve the quality of management within residential parks? If so, in what areas do you think education is most needed?

NSW Fair Trading could provide support through seminars, newsletters and an improved website

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Key Issue 3: Rent increasesFrequent, large or unpredictable rent increases are a major concern to residents. Rent increases are a particularly serious concern for older residents who have retired and are living on fixed incomes.

The immobility of dwellings provides extraordinary leverage for park operators. With their home affixed to the land and costing many thousands of dollars to move residents cannot simply pack up and go elsewhere in response to frequent or high rent increases. This problem is compounded by the fact that residential parks are full in many areas, and even where sites are available operators often refuse to accept older homes. If a resident cannot afford the new rent and tries to sell the home the park’s high rents may make it harder to sell.

It is equally important that park owners can collect rent that is adequate to ensure that their business is sustainable. In the absence of appropriate arrangements, the residential parks sector would be likely to decline.

The 2005 reforms to the Act that sought to encourage park operators to keep rent increases at or below the rate of inflation, and thereby out of the Tribunal, have not proven to be very successful. An increasing number of disputes about rent increases in residential parks are being heard by the Tribunal. The following graph shows the number of excessive rent increase applications received by the Tribunal over the past 7 calendar years:

0

500

1000

1500

2000

2500

2004

2005

2006

2007

2008

2009

2010

cases

In the last financial year (2010-11) there were just under 2000 applications received in the Residential Parks Division of the Tribunal. Almost 60% involved claims of excessive rent increases.

By way of comparison the retirement village sector accounts for less than 100 applications to the Tribunal each year, only some of which involve claims of excessive increases in charges. However, this is not a fair comparison, as each park resident has to lodge a separate application to challenge an increase, while in a retirement village only one application is usually lodged, by the operator, if the residents fail to consent.

In 2010 a record number of 2052 excessive rent increase cases were heard by the Tribunal

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The following table shows the actual number of parks involved in a dispute about rent increases as opposed to the total number of applications received.

Year Total excessive rent

increase applications Actual number of

parks involved

2006 1446 36

2007 1050 40

2008 738 29

2009 1182 30

2010 2052 41

One of the stated problems with the existing system is that the resident bears the onus of proof, as they are the applicant to the Tribunal. It is argued that this is a difficult burden for residents to overcome due to the lack of access to park expenses and financial documents. A considerable amount of time, research and effort is required to prepare a case. Some residents attend the Tribunal year after year for each new increase. NSW Fair Trading has examined all of the published reasons for decisions from the Tribunal involving excessive rent increase applications since the laws were changed in 2005. This involved 60 decisions, which provide a useful sample of the outcomes of such cases. Of these 60 decisions:

• in 8 decisions (13%), the proposed increase was struck out and the existing rent retained;

• in 39 decisions (65%), the Tribunal allowed a smaller increase than that which was sought by the park operator; and

• in 13 decisions (22%), the Tribunal dismissed the residents’ applications.

The majority of these cases involved proposed increases of between $5 and $10 per week. In one decision a proposed increase of $26 per week was reduced to $2.50 per week by the Tribunal. The amount of rents on sites in parks are steadily increasing in some areas. They can be as much as $200 per week or more. In the early days they were more equivalent to strata levies paid by home owners. It is suggested that one of the problems with the 2005 changes limiting the Tribunal to only hearing disputes involving increases above the CPI is the issue of ambit claims. Some park owners may raise rents more than they want knowing that the Tribunal may reduce it to around what they wanted in the first place.

In 78% of cases sampled the Tribunal either dismissed the proposed rent increase or reduced the increase sought by the park operator

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The NSW Government is committed to reducing the level of disputes over rent increases. The following have been identified as possible reform options: Option 1 – Fair Trading assessment Under this option the existing process would be kept with the introduction of an intermediate step, whereby a park operator would be required to present their case for a rent increase to an officer from NSW Fair Trading who would assess whether the increase is either justifiable or excessive, and issue a recommendation. The officer would rely upon information gathered from the industry and other sources (such as utility providers) to make a determination. The recommendation from Fair Trading would bind neither the park operator nor residents, who would be free to take the matter to the Tribunal, as happens now. However, the Fair Trading recommendation would be brought to the attention of the Tribunal member as being of persuasive but not compelling weight. This option is the approach taken in Victoria. It seeks to deal with the burden facing residents of having to prove a proposed rent increase is excessive when they are not in possession of the costings documentation. It could, however, undermine confidence in the independence of Fair Trading particularly by those who do not agree with the assessments given. It would be costly to implement and administer. The non-binding nature of the assessments may also have only a minimal impact on reducing disputes. Many parties may take the view that they want to have their ‘day in court’. Option 2 – reversal of the onus of proof Under this option the existing process would be retained but the onus of proof would be shifted from residents onto the operator. That means that the park operator would have to justify a rent increase above CPI, presenting evidence in support of the rise.

This option recognises that residents do not have access to all the information such as the park’s finances and costs that are necessary to prove a rent increase is excessive. It could however, undermine long standing legal principles that the applicant in cases should bear the onus of proof.

It could also increase conflict and the workload of the Tribunal as more residents may seek to challenge otherwise legitimate rent increases if all they have to do is fill out a form and pay the application fee. No jurisdiction can be found where the onus of proof in rent increase applications has been reversed.

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Option 3 – allow pass throughs Under this option the rent could be broken up, using what are called pass throughs. This would allow fixed and uncontrollable amounts charged by third parties, such as rates, taxes and charges to be proportionally passed onto residents as they are imposed. A rental pass through system would remove the uncertain aspects of rent increases where at the moment operators have to make an assessment without necessarily knowing actual increases in rates, taxes and charges. It is understood some parts of Canada and the United States allow pass throughs.

However, splitting the rent up would increase the amount of separate payments payable by residents at different times of the year. Disputes could still arise over these separate payments. Pass throughs could also impact on the rent assistance many residents receive from the Commonwealth Government. Taking out the fixed costs could also increase disputes over what is left in the rent, which some residents may view as simply profit.

Option 4 – recognise future rent increases can be set out in the agreement Under this option the parties could agree on the process for future rent increases when they sign the initial agreement, as long as the amounts or method of determining the increases are fully and clearly set out and are binding on the parties. Statutory recognition of such agreements would eliminate the involvement of the Tribunal so long as the agreement was adhered to. This would help operators with future decision making. It would also provide residents with the ability to negotiate before moving in and eliminates any surprise increases afterward.

Such agreements could include: • linking future increases to the CPI or changes to

the rate of pension; or • providing for annual increases of a specified

percentage.

One issue with this option is what to do when the initial agreement expires? The law could require the parties to renew the agreement and agree again on the level of rent and future increases. If the agreement is not renewed the law could require the parties to use a binding appraisal process where an agreed assessor determines the rent based on comparable rents paid by new residents in the same park or the general market level of rents. This is the approach taken in a number of jurisdictions overseas and is a common feature of commercial leases. Alternately, the terms agreed in the initial lease could continue to apply indefinitely.

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Option 5 – reverse the 2005 reforms The inclusion of section 58(2A) under which the Tribunal can no longer rule that an increase is excessive if it does not exceed the CPI has not been successful in reducing the level of disputes. It could be argued that it has had the opposite effect and led to ambit claims and encouraged a view by residents that a proposed increase above CPI is ‘excessive’ on the face of it. Removing this amendment could reduce the volume of disputes involving rent increases.

Instead, greater clarity could be given in the Act of the factors the Tribunal will consider in determining such applications and the type of evidence that is needed. The law could also require operators to provide reasons in rent increase notices and a breakdown of the current rates payable within the park.

Option 6 – require the operator to apply to the Tribunal if the residents do not consent This option would recognise the collective nature of residential parks, in a similar way to how increases are handled in retirement villages and strata schemes. In response to a proposed rent increase residents could be required to consider the proposal as a group and advise the operator whether or not they consent to the increase. This could be done by way of:

• a meeting of residents; or

• through the residents committee; or

• by way of a petition against the proposal signed by more than 50% of residents.

If consent was not given it would then be up to the operator to apply to the Tribunal to seek an order that the increase be permitted. This would address the onus of proof issue discussed under option 2 without needing to specifically reverse the onus. Having the operator apply would significantly reduce the volume of applications to the Tribunal, saving costs for both residents and the Tribunal. It would also ensure that any decision is binding on the entire resident population not just those residents prepared to go to the Tribunal. This would help to keep rents for similar sites at the same park at the same level. It would also eliminate disputes from going to the Tribunal where only a minority of residents oppose the increase. Which option, or a combination of options, to improve the process of resolving excessive rent increase claims do you support and why?

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Improved disclosureBefore a resident signs an agreement the park owner must currently provide the following:

• a copy of the Residential Park Living booklet produced by NSW Fair Trading (43 pages);

• a list of the park rules; • a list of all entry costs that will be payable; • a statement that occupation is on a tenancy

basis which may end in certain circumstances and no ownership of land is involved; and

• answers to a list of 16 questions (section 73).

This is a lot of paperwork for incoming residents to read and try to understand. Some of the information is repetitive and may not be relevant to individual residents depending on their circumstances. It is likely that given the amount of paperwork some residents may choose not to read it, defeating the purpose of providing the information in the first place.

One alternative would be for Fair Trading to produce a much shorter publication, similar to the recently published Moving into a Retirement Village? brochure. This could be combined with a 1-2 page disclosure statement required to be completed and given out by park operators, highlighting the key features of the agreement the resident is about to enter into. This would reduce costs for park operators while at the same time increasing the likelihood that the information will be read and understood by incoming residents.

Another issue is the timing of disclosure. Most incoming residents are only given the required information at the same time they sign the agreement. This means it comes too late to be of any help in making the decision to move into a park. A better approach could be to require information to be supplied when a prospective resident first makes an enquiry.

Currently, incoming residents can commit and sign up on the spot. Some residents may feel rushed or pressured into making a decision. One option could be for residents to be given 14 days to consider agreements before signing. This works well in the retirement village sector.

Under the new tenancy laws landlords are now required to disclose matters of material interest. A similar obligation could be imposed on park operators. This could include details of recent flood and fire events, mortgagee repossession action, details of any development applications lodged by the park owner, and details of any non-compliance with set backs, site areas or past improvements made to the dwelling.

Do you think the disclosure of information to incoming residents should be made more useful?

One option could be for residents to be given 14 days to read disclosure material and consider agreements before signing

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Dispute resolution mechanismsThere are approximately the same number of residential parks and retirement villages in New South Wales, with similar numbers of residents with similar issues. And yet in the last financial year (2010-2011) there were almost 2000 applications to the Consumer, Trader and Tenancy Tribunal involving residential parks and only 85 applications involving retirement villages. While some of this disparity can be explained by the different processes involved with challenging rent increases discussed earlier in this paper, the level of disputation within residential parks is disproportionate.

Under the current laws all disputes can be taken directly to the Tribunal. There are no other internal or external requirements before taking this step. Upon receiving an application the Tribunal has the power under the Act to refer the matter, with the consent of the parties, for alternative dispute resolution. This could include to the park’s Liaison Committee, NSW Fair Trading’s Mediation Unit or a Community Justice Centre. However, these referral powers have rarely, if ever, been used as, once a matter has been taken to the Tribunal, it is usually resolved by either conciliation or adjudication within the Tribunal system. role of park liaison committees In Western Australia park liaison committees can play a role in resolving any disputes between residents or between residents and the park operator. In NSW, this role is limited to disputes about methods for the payment of rent. Adopting the Western Australian approach could assist to reduce the volume of disputes going to the Tribunal by enabling some to be resolved in the park. mediation through NSW Fair Trading In strata schemes parties to disputes are generally required to attempt mediation through Fair Trading before they can apply to the Tribunal. Mediations in this area have a high success rate (70%). A similar system for residential parks could help the parties find solutions and help maintain good relations within parks. It could empower residents to raise their concerns in a less confrontational environment. Mediated agreements could be made into an order by the Tribunal to enable enforcement. A mediation system for parks would not need to be the same as the one for strata schemes. For instance, it could be free, voluntary or require the mediation sessions to be held on site at the park, wherever possible. The register of parks could be used to actively promote this service.

In the 2010-11 financial year there were almost 2000 applications to the Tribunal involving residential parks and only 85 involving retirement villages

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representative actions Often a dispute in a residential park will involve more than one resident. For instance, it may involve a withdrawal of services in the park or a challenge to the validity of a park rule. Under the present system each resident concerned must apply to the Tribunal individually, although processes are in place to ensure such applications are heard jointly. In a retirement village the residents committee or an individual resident representative can apply to the Tribunal on behalf of a group or all of the residents. A similar system for residential parks could result in cost savings for both park residents and the Tribunal. role of advocacy groups Many residential park residents are elderly retirees who may never have appeared before a court or Tribunal in their lives. While the Tribunal is relatively informal, appearing before it can still be a daunting prospect for many people. Residents can request to be allowed to be represented. Each application is assessed on its merits but representation, usually by a local Tenants Advice and Advocacy Service or from the Affiliated Residential Parks Residents Association, is regularly granted. It may assist if these groups were given automatic representation rights, so long as they have the consent of the resident. Automatic representation already exists for park managers to act on behalf of park owners before the Tribunal. proactive compliance The establishment of a register of residential parks opens up opportunities for NSW Fair Trading to take a more proactive role in enforcing compliance with the legislation. For instance, a park owner may have park rules or additional terms in their agreements which are unfair, unlawful or unenforceable. Under the present system a resident would need to make a complaint or take the matter to the Tribunal. Fair Trading could use the register to request all park owners to submit copies of their park rules and additional terms for checking. This proactive approach could ensure that matters of concern are addressed as early as possible before they escalate into a dispute. Having matters brought up and resolved by an independent third party also prevents an individual resident from pursuing action which could damage their relationship with the park owner. Have you had any experiences with the Tribunal in resolving disputes? Do you have any views on how the process of handling disputes in residential parks could be improved?

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Park rules Park rules, about things like keeping pets, landscaping, noise and maintenance standards for dwellings play an important role in residential parks. However, making and enforcing park rules can also cause disputes between residents and park owners. subject matter of park rules Presently, the Act and Regulations contain a long list of matters which may be the subject of park rules. This appears to be unnecessary red tape. Why parks should be restricted from having a rule about something which is not on the list is unclear. A less prescriptive approach would be to allow park rules on any matter not already covered by the agreement, so long as the rule is not unreasonable or unconscionable. model park rules Disputes often arise over the legality and wording of park rules. One option which may help to overcome such problems would be for NSW Fair Trading to develop, publish and promote a set of model park rules in association with key stakeholder groups. This initiative has already been successful in other areas, such as model rules for incorporated associations, strata by-laws and retirement villages. changes to park rules The Act gives all power to the park owner to make unilateral changes to the existing park rules, provided residents are generally given 60 days notice. Rules of any description are more often adhered to when those they are directed at feel they have some level of ownership over the rules. Consequently, whether residents should be able to initiate changes to park rules or their consent should be required, perhaps through either the liaison committee or residents committee, are possible reform options. Similar provisions already exist in overseas jurisdictions. Park owners could be given the right to go to the Tribunal where residents refuse consent to a proposed rule. Another issue is the 60 days notice requirement of any changes. It is unclear why such a long period is necessary. A change to a park rule could, for example, involve a safety issue like speed limits. One option could be to simply require notice and leave it up to the park owner to determine how much notice to give residents in each circumstance. Another option could be to have a shorter period, for example, 7 or 14 days, with scope for no notice in an emergency.

NSW Fair Trading could develop, publish and promote a set of model park rules

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enforcement of park rules The Act requires park owners to take all reasonable steps to ensure residents comply with the park rules. Victoria goes one step further and requires park owners to ensure that the park rules are reasonable and are enforced and interpreted consistently and fairly. A similar provision in NSW may help to reduce disputes over the selective enforcement of park rules. Presently, if a resident is not complying with the park rules the park owner can only take the matter to the Tribunal for a compliance or termination order. Many park owners choose not to take action because of the cost and time involved. An alternative could be to allow the park owner to issue small fines if the resident fails to remedy the breach after a second warning letter. The resident could then challenge the matter at the Tribunal if they believe they have done nothing wrong. The Act requires park rules to be terms of every agreement. The practical effect is to make them the same as additional terms of the agreement. No other Australian jurisdiction appears to take this approach. Distinguishing park rules from the agreement itself may help to reinforce the importance of the agreement and improve understanding of the role of park rules. One of the more common areas of disputes with park rules is over the use of recreational facilities within the park. It may assist if the law spelled out that each common area facility should be open or available to residents at all reasonable hours, with the hours and any restrictions of use posted at the facility. Park rule disputes can also be commonly about the maintenance and standard of the residents’ dwellings. It may assist if the law clarified that while park rules may require residents to maintain their homes they cannot require them to replace or remove older homes or make upgrades or improvements which are merely aesthetic and not health or safety related. Presently, provisions relating to the making of park rules are in Part 6 of the Act while the process for challenging park rules can be found in Part 11. Bringing all matters relating to part rules together into one Part of the Act may make the Act easier to navigate. Do you agree that the process for making and enforcing park rules needs to be updated? Do you have any other suggestions for how the park rule provisions could be improved?

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Sale of dwellings A number of stakeholders have suggested that the process for selling homes on-site could be improved. One issue that has been raised is the need for proprietary checks for purchasers. There are also calls for better protection of money paid for dwellings which can be up to $200,000 or more. The purchaser is relying on the honesty of the park owner or outgoing resident as there is usually no conveyancer or real estate agent involved. Things could potentially go wrong if, for example, the seller was fraudulently claiming to be the owner of the home. One option could be for NSW Fair Trading, in partnership with key stakeholders, to develop and promote a model ‘Bill of Sale’ for those selling homes privately and an agreement to appoint the park owner as a selling agent. These could include warranties as to ownership and an obligation that money is to be held in trust if the sale cannot be completed immediately. Even where a real estate agent is involved the protection of any deposit or purchase price is not guaranteed. Fair Trading is aware of at least one instance where an agent took money from a person to buy a dwelling in a park and then went broke. The payment was not covered by the statutory compensation fund which ordinarily protects payments to agents because it involved the sale of a chattel. Another issue surrounds interference by park owners in the sale process. Presently, the Act requires owners not to interfere with a sale, unless restrictions are included in the site agreement. What sort of restrictions this is meant to cover is unclear. This can lead to disputes ending up in the Tribunal. One of the more common restrictions park owners seek to impose is a requirement that the home not be sold unless it complies with the Local Government Act. The Tribunal has ruled such terms to be unenforceable in the past. One option would be for the law to simply say that residents have the right to sell their dwellings on site which cannot be interfered with by the park owner. This is the approach taken in Queensland and South Australia. Alternately, the law could spell out in precise terms the type of interference that is acceptable. Under the current law, where there is interference by a park owner with a sale the resident involved can apply to the Tribunal for an order preventing further interference.

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It has been suggested that the Tribunal should also have the power to order compensation, particularly where the interference has led to the loss of a buyer or a reduced sale price. ‘For sale’ signs can be the cause of disputes between residents and park owners. The Act currently allows a resident to put a ‘for sale’ sign on their dwelling or site, but only if the agreement does not contain a term which prevents them from doing so. Whether park owners should be able to include terms preventing ‘for sale’ signs on a resident’s dwelling or site is questionable. A further issue is whether park residents or their agents should be able to place for sale signs on the nature strip outside a residential park. This is where sale signs are usually placed on strata schemes, community schemes and other large estates in order to attract the attention of passing traffic. There is a potential for a conflict of interest to arise when residents sell their dwellings through the park owner, especially when the park owner has new dwellings for sale at the same time. The Residential Parks Act does not deal with these situations in any way. Other laws, such as the Property, Stock and Business Agents Act 2002, contain provisions about conflicts of interest. The process of selling a dwelling on site in a residential park can be complex and disjointed. The outgoing resident has to either terminate their agreement and the purchaser signs a new site agreement with the park owner or the existing agreement needs to be assigned to the purchaser. Assignment (i.e. the transfer of a lease) is often misunderstood and not done correctly. It also locks in the park owner to terms and conditions which may have been negotiated a long time ago and have since been changed with newer residents. There are a number of ways the process of selling a dwelling on site could be simplified. The law could require any sale of a dwelling on site to be subject to the purchaser entering into a fresh site agreement with the park owner on the same day or within a specific period of time. The ability to assign an agreement could be removed. Another option could be to give park owners a first right of purchase at the asking price set by the resident. Do you have any views on how the process of selling dwellings on site could be improved or streamlined?

‘For sale’ signs can be the cause of disputes between residents and park owners

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Security of tenure Security of tenure remains a concern for many residents who own their dwelling but rent the site from the park owner. The major worry is the potential to lose their home if the park is redeveloped or is sold for a use other than as a residential park. One suggestion that has been put forward is that the laws be changed to encourage more long-term leases of up to 40 years. Most residents currently move in on an initial lease for 6 or 12 months, which is often not renewed but continues indefinitely. It is argued that a registered long-term lease would provide greater peace of mind. Long-term leases may also attract financial institutions to offer mortgages, opening up the market to those that cannot presently afford to buy in or a younger demographic of residents. If a resident wishes to move the fact that there may still be a long term remaining on the site lease would be an advantage in selling the home. However, some residents may be anxious or unwilling to commit to signing a lease for a very long term. They may be worried about the costs involved in sub-division and registration or what may happen if they need to break the lease and cannot find a buyer. Very long-term leases with a mortgage attached could also have major financial consequences, particularly if interest rates and site fees rise at the same time. Long-term leases may work fairly well for new residents. But what about residents who are already living in parks? Another option could be to require minimum initial lease periods of say 3 or 5 years, which would be renewed indefinitely if not otherwise terminated. 5 year minimum leases were recently adopted in Victoria for new parks. A further option may be to do away with fixed term periods altogether, given that the Act already protects residents from eviction, making the fixed term period largely irrelevant. Having said this, while the land in residential parks is owned by an entity or person other than the residents there will always be concerns over security of tenure. Park owners from time to time may wish to realise the value of their asset by redeveloping the park or selling the land for a different use. The law cannot stop this from happening. The law can however, play a role in encouraging the viability of parks and where this is not possible or feasible ensuring there are fair processes in place to protect the interests of residents.

Long-term leases may attract financial institutions to offer mortgages, opening up the market

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One model that can achieve security of tenure is for the residents to purchase the park as a co-operative. This would give residents joint control over the management and future of the park. However, residents would need to acquire skills, business plans and finance to put this idea into practice. Fair Trading is aware of at least one residential park on the Central Coast which has implemented the co-operative housing model.

Co-operative ownership by residents is more common overseas, such as in the United States and Canada. A number of jurisdictions actively encourage it by requiring the park owner to notify residents of an intent to sell, after which the residents committee (if one exists or is formed) has 90 days to express its intent to exercise a right of first refusal, followed by an additional 180 days to obtain financing or guarantees. The aim is to allow the park owner the full financial value of selling the park while also giving residents the opportunity to match offers from other interested buyers.

Another alternative would be to require all future residential parks to be developed as either a strata scheme or community scheme.

Some park owners are concerned that their earnings do not match the underlying value of their investment, making the sale or redevelopment of the park more attractive. The land may be worth millions but all that many owners receive in return is a small profit margin on the site fees after the initial profits on the sale of homes. One option that could be considered is to allow agreements to contain terms which share any future capital gains between the resident and the park owner when the home is sold on-site. Sharing of capital gains is a feature of the retirement village industry. A further ongoing profit source like this may encourage park owners to stay in the industry and spend money on common areas to improve the value of homes. This could also help take pressure off rising rents.

The Act currently provides for park owners to compensate residents for relocation expenses if they need them to leave because of change of use, upgrading or closure. The system assumes the resident will move to another park, but in many cases that may not be viable or possible. A fairer method could be to allow agreements to state the amount payable or set out the method of calculating compensation in these situations. This would allow the parties to know up front where they stand. Alternatively, it could be based on the value of the home, as assessed by an agreed valuer named in the agreement, prior to the decision to change the use or close the park being made.

Do you have any views on ways in which the security of tenure for residents could be improved?

Enabling park owners to share in any capital gains could help take pressure off rising rents

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Greater simplicity and certainty The NSW Government has given a commitment to reduce red tape by 20% in its first term and introduce a ‘One On, Two Off’ rule for any new regulation. With more than 1000 existing Acts, New South Wales has more legislation than any other State. Those involved in the residential parks sector currently need to be familiar with, in addition to planning policies and local environment plans, the:

• Residential Parks Act 1998; • Residential Parks Regulation 2006; • Local Government (Manufactured Home

Estates, Caravan Parks, Camping Grounds and Moveable Dwellings) Regulation 2005;

• Holiday Parks (Long-term Casual Occupation) Act 2002; and

• Holiday Parks (Long-term Casual Occupation) Regulation 2009.

Having so many pieces of separate legislation creates potential for overlap, inconsistency and conflict. One option would be to combine all the laws into a single Residential and Holiday Parks Act. This would remove areas of unnecessary duplication, bring about consistency with terminology and help facilitate a whole of Government approach to the sector. Fair Trading, Planning and Local Government could retain their responsibilities for administration if this approach was to be adopted. terminology The current Act grew out of the Residential Tenancies Act and brought across some of the same terminology used in the tenancy sector, such as ‘residential tenancy agreement’, ‘tenant’ and ‘rent’. It has been suggested that these terms are not appropriate for the arrangements that commonly exist in residential parks. More accurate and suitable terminology to use throughout the Act could include ‘site agreement’, ‘resident’ or ‘home owner’ and ‘site fees’.

The term ‘residential park’ appears to have gained widespread acceptance. The use of other terms such as caravan parks, manufactured home estates, relocatable home parks and the like in any legislation to describe residential parks should be avoided.

Another suggestion is that the Act should introduce the term ‘park operator’ to help distinguish those cases where the operator and ‘park owner’ is not the same person. Calling such people the park owner when they do not own the park is seen as confusing.

Having so many pieces of separate legislation creates potential for overlap, inconsistency and conflict

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coverage under the law The Act currently applies a ‘principal place of residence’ test to determine coverage, which can result in the unintended consequence of certain residents who were meant to be protected by the Act being excluded. This can cause tenure issues upon the death of a resident. It can also affect those who move to a nursing home or decide never to move in or sub-let.

A simpler and clearer approach would be for the law to apply once an agreement is signed until it terminates in accordance with the Act. This would overcome the unintended consequences with the ‘principal place of residence’ test. It may also assist if the Act was to contain more relevant exemptions (e.g. tourists, camping grounds, on-site resident managers etc) rather than the irrelevant exemptions that were carried across from the tenancy laws in section 6.

simpler standard agreement The Regulations currently prescribe five standard agreements with relatively subtle differences between each. This can result in unnecessary confusion and the wrong agreement being used. One standard agreement, with sufficient flexibility to take account of any legislative differences, would be more transparent. Shortening and rewriting the agreement in plain English may also help residents and park owners better understand their rights and obligations.

matters covered by other laws The new Australian Consumer Law, which began on 1 January 2011, overlaps with the residential parks legislation to a certain degree. The Consumer Law contains provisions dealing with false and misleading representations and unfair contract terms, which are also dealt with under the Residential Parks Act.

The Unclaimed Goods Act 1995 sets out a comprehensive process for businesses to deal with unclaimed goods. The Residential Parks Act also contains provisions many of which are the same or similar in dealing with goods left behind by residents.

The arrangements for the supply of energy are due to change. Under the new arrangements, the former Ministerial Council on Energy has committed to working towards a 1 July 2012 start date for a new national framework to harmonise electricity and gas licensing. This will largely replace the existing NSW energy regulatory framework, including the on supply of electricity in residential parks. Under the national arrangements, it is proposed that residential parks will be exempt from requiring a national retailer authorisation (a licence) but will still be subject to meet certain conditions in the sale of electricity including registration with the Australian Energy Regulator. A class exemption is currently being developed for on-selling to residents within residential parks and further information can be found at http://www.aer.gov.au/content/index.phtml/itemId/737837

Removing provisions which are adequately covered by other legislation would help to simplify the residential park laws

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NSW Fair Trading currently produces a 12 page document titled Customer Service Standards for the Supply of Electricity to Permanent Residents of Residential Parks. This will largely replicate the class exemption being developed although not completely. For example, the exemption does not address the arrangements for service fees for residents being supplied at a rate less than 60 amps nor prohibit late payment fees. These two important consumer protections could be kept in the residential park laws once the national arrangements begin.

rental arrangements in parks People who rent homes in parks are similar to tenants who rent premises in the general community. However, their tenancy rights are set by the Residential Parks Act not the residential tenancy laws. The Residential Tenancies Act 2010, which commenced in January, contained over 100 reforms which do not apply to those renting homes in parks. One option would be to adopt the Queensland approach and bring those who rent homes in parks under the general tenancy laws, leaving the Residential Parks Act to cover only those that own dwellings. This would make the Act much shorter and simpler as provisions dealing with reservation fees, locks on premises, access to homes etc would not need to be replicated. The alternative is to incorporate most or all of the recent tenancy law changes into the Residential Parks Act.

consistent rights for dwelling owners Not all residents who own their dwellings in residential parks have the same rights. The Act has different provisions, particularly in regards to the on-site sale of homes, for those living on Crown Reserves and National Parks and those that own a caravan without a rigid annex. A number of stakeholders have suggested it would be simpler if all permanent residents who own dwellings had uniform rights.

greater clarity of obligations The present obligations of residents and park owners are spread throughout the Act or left unsaid. It may assist to provide greater clarity and certainty if the obligations of the parties were brought together and further spelled out. This could include more detail about who pays for what, including sewer availability charges. The Act could also specify the park owner’s obligations to maintain entry lights and common area lighting in good working order; maintain roads and walkways in a safe condition and ensure each site is lawfully useable as a residence and complies with any regulations under the Local Government Act 1993 with which it is required to comply. A general obligation to act in good faith could also apply to all parties.

service of notices Generally, the Act requires notices between residents and park owners to be served by hand or by post. A more practical option could be to also allow parties to serve notice by putting it in the letterbox of the other party.

Do you agree that the law should be simplified and clarified? Do you have other suggestions for how this could be done?

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Emerging issuesThe following matters have been identified as emerging issues within the residential parks industry since the laws were last reviewed more than 5 years ago.

shared equity agreements At least one park operator in recent years has introduced shared equity agreements. These are generally offered to residents who cannot afford the full price to purchase a dwelling. Shared equity agreements are not currently covered by the Act. Under a shared equity agreement the resident buys a major share of the home (e.g. 70%) with the park operator retaining the balance. Legally the resident and operator become ‘tenants in common’, but the resident is responsible for 100% of the site fees and to maintain and insure the home. Any capital gains upon sale are shared between the parties in the same proportion, but if the home sells at a loss the operator’s share is based on the original purchase price.

It is understood that many residents who sign equity purchase agreements do so without first getting legal or financial advice. The wording of equity purchase agreements can be complex and legalistic. A simple, one page question and answer document or disclosure statement highlighting the key elements of such agreements may help to improve the understanding of those residents who chose the shared equity option.

Another issue is whether certain provisions of the Act, such as section 86 dealing with cooling-off rights, should be amended to clarify that they also apply to equity purchase agreements, given that such arrangements were not contemplated when the laws were first drafted.

entry fees It has been drawn to Fair Trading’s attention that some parks are charging residents a non-refundable entry fee of between $1,000 and $10,000. Such payments are already prohibited under section 45 of the Act. Improved education of operators could help to stamp out this practice. The establishment of a register of residential parks will assist in this regard.

exit/opportunity fees At least one park operator, as part of its shared equity agreements, has started charging residents what they call an opportunity fee, payable when the dwelling is sold. An example of an opportunity fee is 1.5% of the sale price for each year the resident has owned the dwelling, up to a maximum of 10 years.

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An opportunity fee is similar to an exit fee (also known as a deferred management fee) which has become a common feature of retirement village contracts.

An opportunity fee is also similar to premiums which some park operators used to charge residents upon sale in the 1980s and early 1990s. The main difference is that a premium was a fixed amount, not a sliding percentage based on length of occupation. Premiums were prohibited when the current laws were introduced.

One option would be to prohibit any future exit fees before they become widespread, in the same manner as entry fees and premiums have been prohibited. A number of jurisdictions in the United States already prohibit exit fees. Alternatively, it could be left to market forces to determine if such fees are payable so long as there is adequate disclosure.

If exit fees are to remain chargeable, whether it is necessary for any legislative provisions needs to be considered. For example, exit fees under the retirement village laws must be calculated on a daily basis, to avoid residents being charged a full years’ fee for only a small part of their final year. use of parks as crisis accommodation An emerging trend has been the use of some residential parks as a form of crisis accommodation, often on a referral from Housing NSW and charities. Such arrangements take advantage of the 30/30 rule in the Regulations, under which the tenancy does not come under the law for up to 60 days. No other form of tenure allows for trial tenancies. Whether residential parks are suitable as a form of crisis housing is an issue, given the close living environment and the lack of support services, especially for people with psychiatric disabilities. Having a concentration of high risk, disadvantaged people within the same residential park raises broader issues for the wider community. Some park owners have taken the step of refusing crisis referrals after previous bad experiences. Repealing the 30/30 rule would most likely further reduce the use of parks as crisis accommodation. However, this could place greater reliance on other forms of emergency housing, such as hotels, motels and refuges. Another option would be to apply the law from day one but include additional powers for park owners to better deal with anti social behaviour.

Greater measures could also be undertaken to better inform disadvantaged park residents of their rights and operators of their obligations, particularly in non coastal parks where this may be a bigger issue.

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parks exclusively for over 55s Another noticeable trend has been the increasing number of parks which cater exclusively to retirees. They market themselves and compete for residents alongside traditional retirement villages. Prospective residents may find it difficult to distinguish between a residential park which caters for over 55s and a retirement village when looking at the advertising and sales material. Some residents may move in mistakenly believing they are buying into a retirement village. It has been suggested that parks which are restricting occupation to retirees are doing so partly to take advantage of the land tax exemptions that apply. Questions have also been raised about the legality of such arrangements under the anti-discrimination laws. While age restrictions appear to be generally supported by residents problems can arise for those under 55 living in a park where such a policy is introduced. Restricting the market of future buyers can also impact on the resale value of existing dwellings. Requiring advertising material for such parks to include a clear statement that it is a residential park not a retirement village may help to avoid misunderstandings. shift from caravans to manufactured homes Many of the caravans that were initially installed in residential parks in the early days are coming to the end of their useful life. Gradually, they are being replaced by manufactured homes. The line between caravan parks and manufactured home estates has become blurred as caravan parks replace caravans with manufactured homes. Some park owners buy caravans from outgoing residents, replace them with manufactured homes and then on-sell the new homes. The existing law is silent on such arrangements as it assumes each home will always be able to be sold onsite. There are no provisions to ensure the resident receives ‘fair value’ for their caravan and how any disputes are resolved. Is there a need to address any of these emerging issues in the legislation? Are there any other emerging issues which need to be addressed?

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Reference Material The following were used to inform this discussion paper:

• Caravan Parks e-brief; produced by the NSW Parliamentary Library Research Service, August 2011;

• Marginal Tenures – A National Picture; A policy paper on boarding houses, caravan parks and other marginal housing tenures; National Shelter Inc. February 2011;

• Final Report – Analysis of arrangements regulating residential parks and rental villages in different Australian jurisdictions; produced by the Commonwealth Department of Families, Housing, Community Services and Indigenous Affairs, May 2010;

• Caravan and Camping Industry Profile, produced by the Caravan and Camping Industry Association (CCIA);

• Issues raised in past Outasite Newsletters; published by the Park and Village Service (in particular the PAVS top 10 wish list for residential parks - March 2011);

• The Role of Manufactured Housing in the Delivery of Affordable Housing, a paper produced by the Caravan and Camping Industry Association, July 2007;

• Manufactured Housing Community Tenants: Shifting the Balance of Power, published by the AARP Public Policy Institute, a model State Statute for manufactured housing communities in the United States, 2004 edition;

• Suggested amendments to the Residential Parks Act; Sanctuary Park Residents Association, July 2011;

• CCIA response to Minister for Fair Trading plan to improve residential parks, June 2011

• Response to residential parks policy, Hampshire Property Group, March 2011;

• Statement of Principles – In Reference to the Residential Parks Act; a joint paper from the North Lakes Residential Park Home Owners Assoc, Central Coast Residential Park’s Network and the Residential Parks Home Owners Assoc. NSW Inc. – Lake Macquarie, May 2010; and

• the election commitments of the major political parties in the lead up to the March 2011 election.

Matters not covered by this paper The following matters are not within the scope of this review:

• the rights and obligations of parties covered by the Holiday Parks (Long-term Casual Occupation) Act 2002;

• the procedures and performance of the Consumer, Trader and Tenancy Tribunal;

• any matters covered under the local government or planning laws;

• housing standards and the application of the Building Code of Australia;

• the question of whether BASIX should be applied to residential parks or other ways to improve water and energy saving within parks; and

• the availability of the Energy Accounts Payment Assistance and Water Accounts Payment Assistance schemes to residential park residents.

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Improving the governance of residential parks: Discussion Paper

Appendix A: Consultation Submission Form The NSW Government values your feedback on the issues and options presented in this discussion paper. This survey can also be filled in over the internet and submitted electronically, please go to www.fairtrading.nsw.gov.au The deadline for submissions is 5:00pm, Wednesday 29 February 2012 Please complete and return this submission form, or any other type of written submission, by the closing date, by one of the following methods: Email to: policy@services.nsw.gov.au Post to: Residential Parks Act Review Fair Trading Policy PO BOX 972 PARRAMATTA NSW 2124 Fax to: 02 9338 8918 All submissions may be made publicly available under the Government Information (Public Access) Act 2009 or for other purposes. If you do not want your personal details released, please indicate this clearly in your submission. BACKGROUND INFORMATION You do not need to provide this information. However, knowing some basic information about you will help us gain a better understanding of the residential parks sector in NSW.

1. Are you? Male □ Female □

2. How old are you?

□ 18 to 24 □ 25 to 34 □ 35 to 44 □ 45 to 54

□ 55 to 64 □ 65 to 74 □ 75 or over

3. What is your post code? ……… 4. What is your involvement with the residential parks industry?

□ park owner/operator

□ park resident

□ park manager

□ other (please specify)…………………………………………..

5. How many years have you been involved in the residential park industry?

□ less than 1 year □ 1 to 2 years □ 2 to 5 years

□ 5 to 10 years □ 10 to 20 years □ more than 20 years

Improving the governance of residential parks: Discussion Paper

6. How well do you feel you understand your rights and obligations under the Residential Parks Act?

□ very well □ quite well

□ not very well □ not at all

7. How clear and simple do you find the legislation regulating residential parks?

□ very clear □ quite clear

□ not very clear □ very unclear

8. How well do you think the existing residential parks legislation protects your

interests?

□ very well □ quite well

□ not very well □ very poorly

Feedback on issues raised in the Discussion Paper 1. Which option of licensing for park operators do you support and why? Comments ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... .......................................................................................................................................................................

2. Do you think mandatory education of park operators will improve the quality of

management within residential parks? If so, in what areas do you think education is most needed?

Comments ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... .......................................................................................................................................................................

Improving the governance of residential parks: Discussion Paper

3. Which option, or a combination of options, to improve the process of resolving

excessive rent increase claims do you support and why? Comments ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... 4. Do you think the disclosure of information to incoming residents should be made

more useful? Comments ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... 5. Have you had any experiences with the Tribunal in resolving disputes? Do you have

any views on how the process of handling disputes in residential parks could be improved?

Comments ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... .......................................................................................................................................................................

Improving the governance of residential parks: Discussion Paper

6. Do you agree that the process for making and enforcing park rules needs to be updated? Do you have any suggestions for how the park rule provisions could be improved?

Comments ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... 7. Do you have any views on how the process of selling dwellings on site could be

improved or streamlined? Comments ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... 8. Do you have any views on ways in which the security of tenure for residents could

be improved? Comments ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... .......................................................................................................................................................................

Improving the governance of residential parks: Discussion Paper

9. Do you agree that the law should be simplified and clarified? Do you have other suggestions for how this could be done?

Comments ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... 10. Is there a need to address any emerging issues in the legislation? Comments ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... ....................................................................................................................................................................... 11. Are there any other issues you wish to raise? 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