[2024] UKUT 375 (LC)

Mr Mullin submitted that to displace the statutory presumption of an RPI increase introduced by paragraph 20(1A) a resident would have to make a positive case to that effect. They would have to identify factors falling within paragraph 18(1), or other sufficiently weighty matters, to justify a determination that the reasonable pitch fee was something other than the current fee uplifted by the relevant measure of inflation. In the case of the nine respondents they had not done so and had made no response to the application made against them. It was possible that they had not responded because they did not object to the proposed increase.

When granting permission to appeal, the FTT suggested that it might be appropriate to regard itself as exercising a jurisdiction akin to ‘the rents jurisdiction’. By that I understand the FTT to have been referring to its jurisdiction to determine market rents for assured tenancies under section 14 of the Housing Act 1988. It is likely that it had in mind the recent decision of this Tribunal in Peabody Trust v Miss Carole Welstead [2024] UKUT 41 (LC) in which, at paragraphs [47]-[48], I said this:

Mr Mullin submitted that any analogy with the FTT’s functions in relation to assured tenancies was misplaced. There are important differences between the two jurisdictions. The most significant, he suggested, being that the FTT is not under a statutory duty to determine a ‘fair’ or ‘market’ pitch fee as it is in its rent jurisdictions under the1988 Act or the Rent Act 1977 rent. Under the Mobile Homes Act 1983 jurisdiction the ‘market’ or ‘fair’ level of pitch fee is irrelevant. The pitch fee is a result of the initial bargain between the site owner and the occupier, and the FTT is concerned only with the reasonableness of a change to that fee. Mr Mullin submitted that these were disputes between private individuals and lacked the public elements described in the Peabody case. He referred additionally to the fact that there is no equivalent in the 1983 Act of the FTT’s express power to “make such inquiry, if any, as it thinks fit” (section 78(2), Rent Act 1977).

The points made by Mr Mullin have obvious force in distinguishing the regime for pitch fee review from the procedures under the 1977 or 1988 Acts. But the FTT was not suggesting an equivalence between the different statutes; it was instead hinting that the subject matter of a pitch fee review and the functions ascribed to the tribunal by the 1983 Act might distinguish cases such as this from the determination of ordinary party and party disputes. I think there is more in that suggestion than Mr Mullin allows.

It is well known that protected sites regulated by the 1983 Act are occupied disproportionately by residents who are elderly. In Telchadder v Wickland Holdings Ltd [2014] UKSC 57 the Supreme Court, when interpreting the termination provisions of the 1983 Act, took judicial notice of statistics showing that, of the 65,000 residents of more than 2,000 protected sites in 2002, about 68% were elderly (see Lord Wilson, at [13], and Lady Hale, at [39]). The residents of protected sites do not have conventional tenancies with conventional statutory protection; they usually own their own mobile homes, often having invested significant capital sums in acquiring them and have only a right to station the homes on the site. The demography of this sector of the housing market, and the absence of conventional security of tenure, no doubt explain the elaborate lengths to which Parliament has gone in the 1983 Act and its subordinate regulations to provide protection for park home residents.

One of the most important practical aspects of that protection is the pitch fee review regime. Increases are routinely restricted by reference to inflation and, in the absence of agreement, can only be achieved by the park owner obtaining a determination from the FTT. In my judgment it is significant that under paragraphs 16 to 20 of the implied terms the need to obtain an independent determination by an expert tribunal is triggered by an absence of agreement, rather than by any expression of disagreement by the park resident. Parliament has notably placed no onus on a resident to dispute a proposed increase if he or she wishes to have it scrutinised by the appropriate tribunal. That is in marked contrast to the scheme for increasing the rent payable under an assured tenancy covered by section 13, 1988 Act. An assured tenant who receives notice of a landlord’s proposed increase has the opportunity to refer the notice to the FTT but under section 13(6) the rent proposed will become the rent payable unless the tenant makes that referral within a specified time.

Had it been intended by Parliament that a pitch fee increase equal to the increase in RPI would always be the outcome where a resident omitted to register an active objection to a park owner’s proposal and failed to make an affirmative case before the appropriate tribunal for a lesser increase, it is difficult to see why park owners would have been put to the trouble, delay and expense of making an application to the tribunal under paragraph 17(8) of the implied terms in every case where the proposed increase has not been agreed. It is equally difficult to see why judicial resources would have been allocated to determining the amount of each unopposed increase if Parliament intended that the presumption of an RPI increase would apply in the absence of an active objection. Had a default RPI increase been intended one would surely have expected the statute to provide for it to apply in every case where a resident had not served a counternotice signifying their disagreement or perhaps had not made an application of their own to the appropriate tribunal requiring it to determine the new pitch fee.

It is therefore possible to deduce from the structure of paragraphs 16 to 20 of the implied terms that Parliament must have envisaged a role for the relevant tribunal in every case where a resident does not positively agree to the park owner’s proposed increase. The purpose of that role is obvious. It is likely that a significant proportion of residents who receive a notice proposing an increase will do nothing in response to it. The proportion of non-respondents is likely to be greater the older or more vulnerable they are. The statutory requirement for a reference to the tribunal in every case where an increase has not been agreed must therefore be intended as a safeguard or protection for park home residents, especially those who may be less able to protect their own interests.

In my judgment the FTT was correct when it said it was not a “rubber stamp” in cases where the park owner’s proposal is not opposed. In such cases, as in cases where an increase is opposed, its role is to scrutinise the proposed increase and to determine whether it is reasonable for the pitch fee to increase and, if so, by how much. As the Tribunal has explained in cases such as Wildcrest v Whitely, at [24], the FTT’s task is not closely defined in the implied terms but the object of its determination is clear:

“The only standard which is mentioned in the implied terms, and which may be used as a guide by tribunals when they determine a new pitch fee, is what they consider to be reasonable. Paragraph 16 provides that, if the parties cannot agree, the pitch fee may only be changed by the FTT if it “considers it reasonable for the pitch fee to be changed and makes an order determining the amount of the new pitch fee.” The obvious inference from paragraph 16 is that the new pitch fee is to be the fee which the tribunal considers to be reasonable.”

How the FTT is to respond to an individual pitch fee review application to which no response has been received is a different question from whether it is required in those circumstances to determine an increase equivalent to the change in RPI. The reasoning which has led me to the conclusion that the FTT is not a rubber stamp, and is not obliged to allow an RPI increase, would suggest that the tribunal is intended to apply its own judgment to the determination, but there may often be no material on which to base an assessment of the factors identified in paragraph 18(1) of the implied terms. On the other hand, in some areas the members of the panel may have become familiar with a particular site over many years and it may be obvious to them on an inspection that there has been a deterioration in the condition of the park, or a decrease in amenity. If adjoining land which previously provided an attractive outlook has been developed, or if a shop, social club or swimming pool has closed down, the FTT would be entitled to take account of those matters whether or not they were the subject of argument or evidence received from a witness. The important point at this stage is that these are matters for consideration by the FTT; they are not rendered irrelevant by the absence of a positive case by a resident, because the absence of a positive case does not lead to a predetermined outcome without an opportunity for the tribunal to apply its own judgment.

For these reasons I answer the first question in the negative. The FTT was not required to award an RPI rate of increase to those pitch fees where the resident had not responded to the application.