Residential Parks (Miscellaneous) Amendment Bill

Introduction and First Reading

Received from the House of Assembly and read a first time.

Second Reading

The Hon. K.J. MAHER (Minister for Employment, Minister for Aboriginal Affairs and Reconciliation, Minister for Manufacturing and Innovation, Minister for Automotive Transformation, Minister for Science and Information Economy) (23:33): I move:

That this bill be now read a second time.

I seek leave to have the second reading speech and explanation of clauses inserted in Hansard without my reading it.

Leave granted.

Residential Parks in South Australia play an important role in providing affordable housing opportunities to the community, and offering an attractive lifestyle for retirees.

The Residential Parks Act 2007 (the Act) regulates the relationship between residential park owners and residents who live in residential parks as their principal place of residence. The Act was originally designed to primarily address issues arising from people residing in caravan parks in demountable, moveable and inexpensive structures erected on sites rented from the park owner.

The types of residential parks that have developed since the commencement of the Act are unlike those envisioned by the legislation. Some residential parks in South Australia (SA) offer purely long term living in constructed or manufactured homes, while others are a mix of tourist accommodation and dedicated areas for residential living. The types of dwellings in these parks range from caravans with annexes to transportable and manufactured homes.

Residential Park living in SA is continuing to grow in popularity, as it is in the remainder of Australia. Residential parks can offer residents the security of living in a small community, with cost effective housing, often in a pleasant location. Although there is no official data available, it is estimated that there are currently around 2,600 residential or long stay site residents in SA.

In January 2013 the Holdfast Bay Council advised around 40 residents of the Brighton Caravan Park that they had to vacate to make way for a $3 million redevelopment of the park. Sixteen residents took legal action against the council over their eviction. Some residents had lived at the park for more than ten years and had established themselves within the park community. After nearly 18 months of legal proceedings, the residents withdrew their legal action. As a goodwill gesture, the Holdfast Bay Council offered the residents compensation to assist them in moving to other accommodation. This situation highlighted a number of issues with the existing regulatory framework as it relates to rights and obligations of residents and park owners

As many residential parks in SA offer an attractive lifestyle for retirees, residents often invest in or purchase their home with the intention of residing there throughout their retirement. Many home-owners have an expectation that they will be able to live in the park for as long as they wish, even though their site agreements do not reflect this.

At present, the Act does not prohibit park owners from offering long-term agreements to residents, nor does it obligate them to do so. There are many existing agreements already negotiated and voluntarily entered into by residents and park owners, however there are many residents that either do not have an agreement in place, or have periodic agreements that offer limited protection to residents. This raises a number of issues relating to residents' understanding of their rights and responsibilities, and likewise those of the park owner.

In March 2016, the South Australian Government released a discussion paper which sought to make a number of improvements to the current laws that regulate residential parks. Feedback, comments and submissions on the discussion paper closed in July 2016. Feedback received indicated overwhelmingly that the primary concerns were insecurity of tenure, and the absence or inadequacy of legislative requirements relating to the disclosure of information, safety in parks, and the payment of compensation.

The Bill has been developed in consultation with key stakeholders, including the South Australian Residential Parks Residents Association (SARPRA), SA Parks, State Government agencies and park residents.

The Bill seeks to implement measures to provide a fairer and more transparent system for residential park residents and owners.

This Bill seeks to introduce measures that provide for better disclosure of information in the establishment of residential park agreements. The Bill increases the penalty on park owners if an agreement is not put into writing and requires a signed copy of an agreement, together with a copy of written park rules, to be provided to a resident. The Bill also introduces a 14 day cooling-off period to ensure that prospective residents have sufficient time to properly consider an agreement and obtain advice where necessary.

The Bill also seeks to alleviate concerns held by many residents regarding the security of their tenure. Currently, at the end of a fixed term agreement, if it is not formally terminated at that point, the agreement continues as one for a periodic tenancy only, which can be terminated on 'no specific grounds' with 90 days' notice. Many of these people have invested significant amounts of money in their homes, and deserve to have a greater level of security around their tenure.

The Bill seeks to achieve this by providing for residents of more than five years to have their agreements reviewed at their expiry and reissued on same (or new agreed) terms, unless there is a statutory ground not to do so (for example, misbehaviour). The Bill also contains a new provision that requires park owners to give a resident 90 days' notice prior to the expiry of an agreement if they intend on seeking to change the terms of that agreement going forward.

The Bill also strengthens measures already in the Act that are designed to encourage and maintain harmonious relationships between residents and owners. While residents committees may already be established under the existing Act, the Bill proposes to mandate residents committees in larger parks where there are more than 20 long-term residents. Residents committees allow for a forum for residents to raise any issues they have and for those issues to be raised with a park owner through a proper process. Owners must consider and respond to issues raised by the committee in writing within a month of being notified.

The Bill also seeks to improve safety measures in parks, for instance by mandating that all parks have a safety evacuation plan in place, that a copy of the plan is provided to all residents, and that it is reviewed annually.

The review has considered the financial and social impacts of current arrangements on residents, prospective residents and park owners and the reforms will continue to provide for affordable housing and flexible lease terms to support the community with affordable living options.

It is expected that new requirements upon park owners that are proposed by the Bill will be offset by providing them with increased security of income for site rentals for agreed periods, whilst maintaining the flexibility for owners to terminate tenure on no specified grounds for agreements under five years.

To support this package of amendments, CBS has undertaken to update and prepare additional plain English supporting resources for owners and residents containing information and advice regarding the rights and obligations of both parties. CBS will also make available from its website examples of best practice site agreements, park rules and disclosure statements. CBS Advice and Conciliation Officers will also be on hand to offer ongoing support.

Residential parks are an essential part of the affordable housing market in South Australia and we need to do all we can to ensure both residents and park owners can move forward with greater confidence and certainty regarding their rights and responsibilities.

This Bill aims to strike a fair balance between protecting the rights of residents and the investment in their homes, and the interests of park owners to support the growth of their parks.

I commend this Bill to the house.

Explanation of Clauses

Part 1—Preliminary

1—Short title

2—Commencement

3—Amendment provisions

These clauses are formal.

Part 2—Amendment of Residential Parks Act 2007

4—Amendment of section 3—Interpretation

This clause inserts a definition of personal representative and defines the concept of a short term residential park agreement.

5—Amendment of section 4—Presumption of periodicity in case of fixed short terms

This clause is consequential to the new general definition of short term inserted by clause 4.

6—Amendment of section 7—Residents committees

Subclause (1) requires certain park owners (defined in proposed subsection (8)) to ensure that there is a residents committee for the park. The penalty for failure to comply is $1,250 and defences are provided where reasonable steps to comply have been taken. Under the transitional provisions, the park owners will be exempt from the offence provision for 12 months after commencement.

Subclause (2) inserts a new subsection (2a) allowing the Tribunal to make a ruling where there is more than 1 group purporting to be the residents committee for a park.

Subclause (3) requires a park owner to consider representations made by a residents committee and provide a written response. The penalty for failure to comply is $1,250.

7—Amendment of section 10—Residential park agreement to be in writing

This clause provides that a written agreement for a periodic tenancy, or a reissued fixed term tenancy, that has arisen by operation of the Act does not need to be signed (but in the case of a periodic tenancy must include the date, or approximate date, on which the resident was first granted the right to occupy the site (if known)) and also increases a penalty.

8—Amendment of section 11—Copies of written agreements

This clause increases a penalty.

9—Amendment of section 12—Agreements incorporate park rules

This clause requires that a written residential park agreement, or a document recording its terms, signed by a resident includes a copy of the relevant park rules and that residents are notified of any later amendments to park rules. The penalty for failure to comply is $1,250 or an expiation fee of $210.

10—Amendment of section 14—Information to be provided by park owners to residents

This clause requires the specified information to be given to a resident at least 14 days before they enter into the residential park agreement and requires additional information to be provided to the resident. The clause also increases the applicable penalties in the section and adds an offence of knowingly making a statement that is false or misleading in a material particular in information provided under the section.

11—Insertion of Part 3 Division 3

This clause inserts a new Division as follows:

Division 3—Continuation or reissue of certain agreements

17A—Agreement for fixed term continues as periodic agreement if not terminated

The current section 53 is being moved to this proposed new Division.

17B—Certain site agreements to be reissued

A residential park site agreement for a fixed term of 5 years or more (or for a lesser fixed term if the resident has held a right of occupancy for a total period of 5 years or more) will, if it hasn't terminated at or before the end of the fixed term and no notice has been given that a review will be required under proposed subsection (2), be taken to have been reissued on the same terms. Under proposed subsection (2), either party to such an agreement may instead give at least 90 days' notice that they want a change to the terms and, in such a case, there must be a review of the agreement and the agreement must be reissued on the newly agreed terms. The old agreement will continue until the new agreement is reissued.

If a resident under a periodic residential park site agreement has held a right of occupancy for a total period of 5 years or more, the park owner must undertake a review of the agreement and, following the review, the agreement must be reissued for a fixed term agreed with the resident.

A review is not required under the section if the resident notifies the park owner that the resident does not want to occupy the site under a fixed term agreement or if either party has given notice of termination under Division 3 (noting the limitations being imposed on termination for 'no grounds' by other provisions of the measure).

A park owner who refuses or fails to comply with a requirement of the section is guilty of an offence punishable by a fine of $1,250 or an expiation fee of $210.

12—Amendment of section 49—Residential park site agreement—acquisition of park or site

This clause deletes provisions that currently allow the new owner of a residential park to terminate residential park site agreements without specifying a ground of termination.

13—Insertion of section 50A

This clause inserts a new provision as follows:

50A—Sale of dwelling following death of resident

If the personal representative of a deceased resident, or another person who has inherited property of a deceased resident, intends to sell a dwelling that is on the site that was occupied by the deceased, they must inform the park owner of that intention and give the park owner a first option to purchase the dwelling. If no agreement is reached within 28 days, that option will lapse and the dwelling may be sold in the normal way.

14—Amendment of section 52—Termination of residential park agreement

This amendment:

(a) provides that a residential park site agreement for a fixed term does not terminate when a mortgagee takes possession of the rented property under a mortgage (in section 52(d));

(b) makes a minor amendment to ensure consistency of expression (in section 52(da));

(c) limits the provision about termination due to the death of the resident (where no dependents are left in occupation of the property) to residential park tenancy agreements (in section 52(f)); and

(d) clarifies that, except as provided in subsection (1)(f) of the section, a residential park agreement does not terminate on the death of the resident.

15—Repeal of section 53

This section is being moved to new Part 3 Division 3.

16—Insertion of section 70A

This clause inserts a new section as follows:

70A—Termination where change of use or redevelopment

This provision will allow for termination of a residential park site agreement (after a specified notice period) where the residential park will no longer be used as such or where the residential park, or a part of it, is undergoing redevelopment that cannot be completed in a safe and efficient way unless the resident vacates the site. The provision prescribes notice periods and allows for alternative arrangements to be made.

17—Amendment of section 71—Termination where periodic tenancy and no specified ground of termination

This amendment provides that an agreement for a periodic tenancy cannot be terminated for no specified ground if the resident has held a right of occupancy of the rented property for a period of 5 years or more.

18—Amendment of section 72—Termination at end of fixed term

This is consequential to proposed section 17B inserted by clause 11.

19—Insertion of section 73A

This clause inserts a new section as follows:

73A—Harsh or unconscionable termination

If termination of a residential park site agreement is harsh or unconscionable, the resident may apply to the Tribunal for an order or orders.

20—Insertion of section 78A

This clause inserts a new section as follows:

78A—Termination where notice given under section 70A

This provision is consequential to proposed section 70A and allows a resident who has been given a notice of termination by a park owner under that section to terminate at an earlier time without specifying a ground of termination (but with 28 days' notice).

21—Amendment of section 116—General powers of Tribunal to resolve disputes

This clause broadens the Tribunal's power to order a person to make a payment.

22—Amendment of section 134—Commissioner's functions

This clause allows the Commissioner to publish information relating to action taken by the Commissioner to enforce the Act.

23—Insertion of section 138A

This clause inserts a new section as follows:

138A—Park owner must have safety evacuation plan

This provision requires a park owner to have a safety evacuation plan for the park; to provide the plan to residents; and to review the plan annually. The penalty for failure to do so is a fine of $2,500 or an expiation fee of $210.

24—Amendment of section 141—Regulations

This clause amends the regulation making power.

Schedule 1—Transitional provisions

This Schedule contains the transitional provisions relating to the measure.

Debate adjourned on motion of Hon. J.S.L. Dawkins.