WA Introduces Residential Parks (Long-stay Tenants) Reform Legislation

Friday 2 November 2018 @ 11.02 a.m. | Legal Research | Trade & Commerce

On Wednesday 17 October 2018, the Western Australian Minister for Commerce and Industrial Relations, Mr Bill Johnston (the Minister), introduced the Residential Parks (Long-stay Tenants) Amendment Bill 2018 (WA) (the Bill) into Parliament. The purpose of this Bill is to amend the Residential Parks (Long-stay Tenants) Act 2006 (32 of 2006) [WA] (the Act) in order to implement the recommendations of a statutory review undertaken in accordance with section 96 of the Act which provides for a review of the operation of the Act to be carried out by the Minister as soon as practicable after the end of the period of a five years beginning on the commencement of the Act. The Bill is seeking to implement recommendations aimed at improving certainty of contract and fair dealings between long stay parties and the owners of residential parks. The Bill also proposes amendments to the Residential Tenancies Act 1987 (WA) (the RTA).

The Minister has said that park residents, who in the main are seniors, are in a vulnerable position, as while they own their homes, they do not own the land they are built on.  Current laws do not offer any protection to them in the event that the park is sold or where the operator’s lender took possession of the park in cases of bankruptcy or liquidation. According to the Minister:

“The proposed changes will help address key issues, such as certainty of contract, costs of park living, sale of a home, exit fees, termination and park liaison committees, . . . They [the proposed changes] strike a fair balance between protecting the rights of tenants and ensuring the viability of the residential parks sector is maintained.”

The Amendments in Details

Key amendments proposed by the Bill include:

  • improved disclosure obligations, including new disclosure obligations in relation to voluntary sharing arrangements;
  • the end of "without grounds" terminations of long-stay agreements and instead the inclusion of a set of specific grounds for termination that will be included in the Act - see the changes proposed to section 11 of the Act;
  • provision for no termination of fixed term agreements on the sale of a park and no automatic termination if a park owner’s financier takes possession of the park;
  • the provision of clearer rules for park operators, home owners and prospective tenants in relation to the sale of homes;
  • the making of clearer of obligations relating to the creation and enforcement of park rules; and
  • standard lease clauses will no longer be able to be varied, and a minimum set of core terms will apply to all long-stay agreements.

Additionally the Bill proposes to:

  • amend the Act for consistency with the RTA, where appropriate, so that tenants are treated equitably irrespective of the nature of the premises that they lease;
  • amend the structure of the Act is to be changed to improve clarity, by including the standard terms currently set out in Schedule 1 in the body of the Act;
  • remove specific links and references to the Caravan Parks and Camping Grounds Act 1995 (CPCG Act) from the Act as far as is possible to avoid potential anomalies arising out of any changes to the CPCG Act; and
  • make minor amendments to the Act where necessary in order to improve clarity.

New Powers for the State Administrative Tribunal

The Bill gives the WA State Administrative Tribunal the power to make a number of specific orders and directions in relation to matters arising under long-stay agreements. These powers include:

  • the power to declare a term of a long-stay agreement void if it is "harsh or unreasonable"; 
  • the power to make orders in relation to pre-contractual representations; and 
  • the power to terminate a long-stay agreement for breach of disclosure obligations. 

The Bill also gives the WA State Administrative Tribunal the power to consider whether either party has engaged in "unconscionable" or "misleading and deceptive conduct", made "false or misleading representations", or has used physical force or undue harassment or coercion. These amendments made by the Bill are to ensure that the WA State Administrative Tribunal has the power to deal with all matters arising in relation to a dispute about a long-stay agreement

The Need for Reform

Estimates as to the number of residents living in residential parks across WA vary from 5,000 to 20,000, with the key reason for residing in a long stay park being the lifestyle and feeling of community the residents get from living in the parks. In many cases, these residents prefer spending their money on other aspects of their lives such as, travel and caravans. The President of the Park Home Owners Association of WA, Ken Mann, welcomed the changes when they were first proposed, saying they covered many of areas of key concern facing many residents of Long Stay Parks. 

Similar Legislation in Victoria

WA is not the only jurisdiction to have legislated to provide greater protection to tenants in Long Stay Parks. For example, Victoria as part of its Residential Tenancies Amendment Bill 2018 has also legislated to make reforms that extend to renters living in caravan and residential parks, and provided provisions for compensation should their park close. Furthermore, those reforms provide that park owners will also be subject to stricter notification and processes before they are able to close down their park. See our previous article here.

The Victorian Government points to similar reasons for reform of the law:

  • The high land values attaching to some residential parks (namely, caravan parks and residential villages) resulting in an increasing number of closures for redevelopment of the land resulting in fewer low cost, long-term rental options, especially for elderly residents.
  • The fact that residents often own demountable dwellings, which are now expensive to move due to improvements and additions made to them. 
  • The fact that they may also lease the land their home sits on, but have very few rights to stay.

Status of WA Bill

At the time of writing the WA Bill has reached second reading stage in the Assembly,

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