[2024] UKUT 294 (LC)

The regulation of park homes through the Mobile Homes Act 1983 is designed to provide for as straightforward a charging structure as possible. Terms implied by the 1983 Act prevail over any express terms of the written statements between the occupiers and the site owners insofar as they are inconsistent, and as a result many written statements are in a standard form.

Paragraph 21 of Schedule 1, Part 1, Chapter 2 (“the Schedule”) to the Act says this:

“The occupier shall—

(a)

pay the pitch fee to the owner;

(b)

pay to the owner all sums due under the agreement in respect of gas, electricity, water, sewerage or other services supplied by the owner; …”

The “pitch fee” is defined by paragraph 29 of the schedule as:

“...the amount which the occupier is required by the agreement to pay to the owner for the right to station the mobile home on the pitch and for use of the common areas of the protected site and their maintenance, but does not include amounts due in respect of gas, electricity, water and sewerage or other services, unless the agreement expressly provides that the pitch fee includes such amounts”

The level of the pitch fee is controlled by the Schedule and will normally rise only in line with the Consumer Price Index each year (paragraphs 16 to 20 of the Schedule; a number of decisions of the Tribunal have explained the operation of those provisions, for example Britanniacrest Limited v Bamborough [2016] UKUT 144 (LC) and Vyse v Wyldecrest Parks (Management) Ltd [2017] UKUT 24 (LC)).

Written statements between site owners and occupiers usually make express provision for payment of the pitch fee and of charges for utilities: two of the appellants’ agreements (Mrs Brazier’s and Mr Askew’s) contain a clause 3 which requires the occupier:

“(a)

to pay to the owner an annual pitch fee of …

(b)

to pay and discharge all general and/or water rates which may from time to time be assessed charged or payable in respect of the mobile home or the pitch (and/or a proportionate part thereof where the same are assessed in respect of the residential part of the park) and charges in respect of electricity gas water telephone and other services”.

That is a standard form provision used on many mobile homes sites which, as we shall see, has been the subject of decisions in the Tribunal and the Court of Appeal.

Ms Stanton’s and Mr and Mrs Mackinnon’s written statements are quite different from Mrs Brazier’s and Mr Askew’s. They do not contain clause 3 as set out above and indeed say nothing about utilities. They require payment of a pitch fee, and each agreement in a box headed “additional charges” says “NIL”, but Ms Stanton and Mr and Mrs Mackinnon do not dispute that the pitch fee does not include payment for electricity and LPG.

There is nothing to prevent written statements relating to mobile homes from making provision for a separate service charge payment by the occupier, analogous to those commonly found in long leases of flats and suchlike; but few written statements do so and none of the agreements in question in this appeal does so. There is therefore no scope for the site owner to make a separate charge for communal services such as the maintenance of estate roads or gardens.

The question that arises in this appeal is whether in the absence of any express general service charge provision the implied and express terms in the appellants’ agreements allow the site owner to make any charges for the administration of utilities, as distinct from the actual cost of the gas and electricity itself.

The answer to that question is already a matter of settled law. The Tribunal and the Court of Appeal have held that neither the statutory implied terms, nor an express term in the form of clause 3(b) set out above, permit a site owner to charge to the occupiers more than the price it has itself paid for gas (whether LPG or not) and electricity to the utility provider. Those terms do not enable it to make any separate administration charge for its work in reading meters, calculating charges and so on; they are covered by the pitch fee (the level of which is regulated as set out at paragraph 16 above).

Three decisions have made that clear. In Britaniacrest Limited [2013] UKUT 521 (LC) the Tribunal (the Deputy President, Martin Rodger QC) had to decide whether clause 3(b) – which appeared in the written statements in question in identical terms to those of clause 3(b) in Mrs Brazier’s and Mr Askew’s written statements – allowed the site owner to add an administration fee to what it charged for electricity and gas. Obviously the words “charges in respect of” enable the site owner to argue that such a charge can be made. The Deputy President said:

“… paragraph 3(b) seems to me to be concerned with the payment of charges levied by a third party, rather than charges levied by the owner of the site.  There is an obvious difference in language between paragraphs 3(a) and 3(b), the first of which requires the occupier to “pay to the owner”, while the second does not identify the person who is to be paid.  That contrast does not exclude the possibility that charges within paragraph 3(b) may also have to be paid to the owner, but it is consistent with the sums within paragraph 3(a) being paid for the benefit of the owner, while those in paragraph 3(b) are to discharge liabilities owed to others, even if those liabilities are met in the first instance by the owner before being reimbursed by the occupier.  That sort of division is also suggested by the nature and description of the charges themselves.

58.

The first types of charge identified in paragraph 3(b) are general and/or water rates.  Where these are charged to individual pitches, the obligation entails that the occupiers will pay the local authority any sums separately assessed for their own pitches. Where the park as a whole is rated only a proportionate part is payable by each occupier, and practicality is likely to dictate that the owner will discharge the liability to the charging authority before seeking reimbursement from occupiers of their proportionate part of the bill.  If the owner incurs a cost in making that apportionment and collecting the contributions of individual occupiers, it is not a cost which could be recovered under the first part of paragraph 3(b) which requires payment only of the relevant rates themselves.

59.

No indication is given in the second part of paragraph 3(b), which refers to “charges in respect of electricity, gas, water, telephone and other services”, that any different approach is contemplated.  The expression “charges in respect of” seems to me to refer to charges levied by the suppliers of the various services, and not to charges made in connection with those services by the park owner. 

60.

…I also consider that … the RPT was correct in its conclusion, in paragraph 33 of the decision, that the cost to the Park owner of administering the utilities was included in the pitch fee.  In the absence of a right for the Park owner to charge a separate fee for the provision of some service which the agreement obliges the owner to provide, the pitch fee payable by the occupier is consideration for the performance of all such obligations of the owner and is in return for all of the benefits received by the occupier under the agreement.”

The Deputy President went on to reject the idea that a term might be implied into the agreement making provision for such an administration charge. He did not separately consider whether the implied term, at paragraph 21 of the Schedule (paragraph 14 above) gives the site owner any entitlement to impose an administration charge, but adds anything, but it seems to me perfectly clear that it does not.

In PR Hardman & Partners v Greenwood [2015] UKUT 587 (LC) a similar question arose, and the Tribunal reiterated its decision that the only charge that the owner could pass on to the occupier for electricity or gas was the unit cost charged to the site owner by the external supplier. A slightly different approach was taken for sewerage services; the Tribunal (again the Deputy President) regarded sewerage as one of the “other services” provided by the owner (see the wording of clause 3(b) at paragraph 17 above) and held that the site owner was entitled to charge for the running costs of the sewerage system insofar as they were incurred in reimbursing charges by third party suppliers, including the cost of electricity for the sewerage system.

The Court of Appeal in PR Hardman & Partners v Greenwood [2017] EWCA Civ 52 upheld the Tribunal’s approach to gas and electricity charges. At paragraph 43 Sir Terence Etherton, with whom Davis and Underhill LJJ agreed, said:

“I consider it is clear that the “charges” mentioned in the second part of [paragraph 3(b)] are charges by third party utility suppliers and the “other services” mentioned are those provided by third parties in respect of third party utility supplies to the pitch. Payment for other third party contractors and for services undertaken [the site owner] themselves is not recoverable under paragraph 3(b) but can be recovered only as part of the site fee.”

There was no appeal about payments for the sewerage service; but at paragraph 58 Sir Terence Etherton said:

“For the sake of clarity and certainty for the future, however, it must be pointed out that, consistently with my earlier analysis and conclusion, I consider that that art of the UT’s decision was wrong since the provision of the sewerage system is a communal service. In the absence of a respondent’s notice, nothing can be done about past charges already paid under paragraph 3(b) for electricity to operate the sewerage system and to reimburse Hardman for payment to third party contractors engaged to empty and service the sewerage system and payment of the licence fee to the Environment agency in respect of the system. In the future however, all such costs and expenses are recoverable only in the pitch fee.”

The position following that decision is therefore that the paragraph 3(b), and the implied term at paragraph 21 of the Schedule, require the occupier to reimburse the site owner for the actual costs to the site owner of gas and electricity as charged by the utility provider itself, and do not require payment of any form of administration charge to the site owner nor the reimbursement of any payment to any third party other than the utility provider.