First-tier Tribunal Approves Reasonable Pitch Fee Increase

FIRST-TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY)

Case References : CHI/00HN/PHI/2024/0252

Properties : 4 [ADDRESS], [POSTCODE]

Applicant: [redacted]

Respondent: [redacted]

Type of Application : Review of Pitch Fee: Mobile Homes Act

1983 (as amended)

Tribunal Members : [NAME]

Mr [NAME]

Ms [NAME] & Venue of Hearing : 21 [ADDRESS], [POSTCODE]

Date of Decision : 21 November 2024

DECISION

© CROWN COPYRIGHT

Summary of Decision

The Tribunal determines that the proposed pitch fee of £181.97 per month is reasonable and is payable from the 1 February 2024.

The reasons for the Tribunal’s decision are set out below.

REASONS

Background

1. The Applicant is the owner of [ADDRESS], [POSTCODE] (“the Park”). The Respondent is a mobile home owner who is entitled to station his home on a pitch within the Park by virtue of agreements under the 1983 Act, which include the statutory terms referred to below. There is no dispute as to the Respondents’ right to occupy the respective pitch.

2. [ADDRESS] is a protected [NAME] within the meaning of the Mobile Homes Act 1983 (“the 1983 Act”). The definition, found in Part 1 of the Caravan Sites Act 1968 includes a [NAME] where a licence would be required under the Caravan Sites and Control of Development Act 1960 if the exemption of local authority sites were omitted.

3. On 20 December 2023 the Applicant served on the Respondent a Pitch Fee Review Notice with the prescribed Form, detailing the proposed new pitch fee and its calculation, payable with effect from 1 February 2024. The Notice was served by way of a late review, pursuant to paragraph 17 of Part 1 of Chapter 2 of Schedule 1 to the 1983 Act. The proposed new pitch fee is £181.97.

4. The Applicants calculated the adjustment in line with the Consumer Price Index (“CPI”) from June 2023, that being 7.9%. No recoverable costs or relevant deductions were applied.

5. The Respondent did not agree to the increase.

6. Against that background, on 19 April 2024, the Applicant sought a Tribunal determination of the matter. No challenge as to the validity of the Notice was raised by the Respondent.

7. On 17 May 2024 the Tribunal issued holding directions requiring the Applicant to serve on the Respondent a copy of the Directions and a reply form for the Respondent to complete. On the 17 May 2024 the Applicant confirmed service on the Respondent. The reply form was not returned to the Tribunal by the Respondent.

8. On 9 October 2024 the Tribunal served directions and a copy of the Tribunal Procedure Rules 2013 on the Respondent. The Directions set down a timetable for the exchange of documentation preparatory to a determination on the papers.

9. In accordance with the Directions, the Tribunal were provided with a hearing bundle, which extended to 58 electronic pages. The bundle included the Application Form PH9, the pitch fee review form and Notice, the Written Statement, the Respondent’s reply and statement objecting to the proposed pitch fee increase, and the Applicants’ reply. References in this determination to page numbers in the bundle are indicated as [ ].

10. Having identified within the bundle the Respondent’s objection to the proposed pitch fee increase, the Tribunal concluded that the matter required a hearing. On 31 October 2024 Directions were issued setting down a hearing for the 21 November 2024.

11. The Tribunal did not inspect the Park as it was neither considered necessary nor proportionate to do so. A [NAME] layout plan was included within the bundle.

12. These reasons address in summary form the key issues raised by the Applicant and the response of the first Respondent. The reasons do not recite each point referred to in submissions but concentrate on those issues which, in the Tribunal’s view, are critical to this decision. In writing this decision the [NAME] has had regard to the Senior President of Tribunals Practice Direction – Reasons for Decisions, dated 4 June 2024.

13. The hearing was recorded and such stands as a record of proceedings.

The Law

14. The relevant law is set out in the Mobile Homes Act 1983 (as amended) (“the Act”).

15. Section 1(1) of the Act provides as follows:

(1) This Act applies to any agreement under which a person (“[NAME]”) is entitled –

(a) To station a mobile home on land forming part of a protected [NAME]; and

(b) To occupy the mobile home as his only or main residence.

16. The Tribunal derives its jurisdiction to determine disputes in these matters by virtue of Section 4(1) of the Act which states as follows:

(1) In relation to a protected [NAME] a tribunal has jurisdiction –

(a) To determine any question arising under this Act or any agreement to which it applies; and

(b) To entertain any proceedings brought under this Act or any such agreement,

Subject to subsection (2) to (6)

17. Under the Act, terms are implied into all agreements to which the Act applies. Those implied terms are set out in Chapter 2 of Part 1 of Schedule 1 of the Act.

18. The relevant terms for the purposes of a pitch fee review are set out at paragraphs 16-20 of that part of the Schedule. In summary, a review of a pitch fee is governed by three statutory principles:

i. The pitch fee can only be changed either with the agreement of [NAME] or by determination by the Tribunal;

ii. The pitch fee shall be reviewed annually as at the review date;

iii. A presumption that the fee will increase or decrease in line with the variation in the Retail Price Index (now CPI”).

19. Paragraph 16 states that a pitch fee can only be changed in accordance with paragraph 17, either –

(a) With the agreement of [NAME], or

(b) If the appropriate judicial body, on the application of the owner or [NAME], considers it reasonable for the pitch fee to be changed and makes an order determining the amount of the new pitch fee.”

20. Paragraph 17(4)(a) states that where [NAME] does not agree to the proposed new pitch fee “the owner [or . . . [NAME]] may apply to the [appropriate judicial body] for an order under paragraph 16(b) determining the

amount of the new pitch fee.”

21. Paragraph 17(5) provides that “An application under sub-paragraph (4)(a) may be made at any time after the end of the period of 28 days beginning with the review date [but . . . ] no later than three months after the review date].

22. Paragraph 18 requires the Tribunal, in determining the new pitch fee, to have regard to particular factors:

i. Any sums expended by the [NAME] since the last review date on improvements;

ii. Any deterioration in the condition and any decrease in the amenity of the [NAME];

iii. Any reduction in the services provided by the [NAME] and any deterioration in the quality of those services;

iv. Any legislative changes affecting costs.

The Hearing

23. The hearing was held at Havant Justice Centre where the Tribunal sat in person. The parties, Mr [APPELLANT], Director of the [COMPANY], and Mr [RESPONDENT], the Respondent, attended the hearing remotely, accessing the Tribunal’s online video platform, CVP.

The Applicant’s Case

24. [ADDRESS] is described as a relatively small Park of 29 properties located in the village of Throop, some four miles north of Bournemouth. [ADDRESS] benefits from a Residents Association, with whom the Park owners have a positive relationship. Mr [NAME] considers the [NAME] to be a pleasant place to live.

25. Mr [APPELLANT] stated that the Applicant is entitled to an annual review of the pitch fee by virtue of paragraph 17(1) of Chapter 2 of Part 1 of Schedule 1 to the Mobile Homes Act 1983 (as amended).

26. Pitch fee reviews were undertaken in 2023 and 2024 by reference to the RPI and CPI indices respectively.

27. Costs incurred by the Applicant in managing and maintaining the [NAME] have risen over the period in question and continue to rise. The Applicant argued it therefore only reasonable that pitch fees increase in accordance with the inflationary mechanism provided for by statute.

28. Whilst the Respondent may suggest that his pitch size is small in comparison to others, the Respondent would have been aware of the extent of the pitch at his point of purchase. Furthermore, occupying a boundary pitch, the Respondent enjoys enhanced privacy.

29. The Respondent accepted the pitch fee when he acquired his home and although pitch fees differ across the [NAME] this is due to varying dates of purchase and the effect of historic inflationary increases.

30. The Applicant stated that the Park is well maintained, attractive in appearance and regularly tended by a gardener. The Applicant has voluntarily extended the scope of maintenance to incorporate an area outside the Park which is no longer maintained by the local authority.

31. Additionally, in the past 18 months the Applicant has renewed several boundary fences, replaced the dragon’s teeth and relocated a homeowner’s garden shed.

32. The Applicant avers that the Respondent has not advanced any ground upon which the presumption in favour of an inflationary increase in pitch fee could be rebutted.

The Respondent’s Case

33. Mr [RESPONDENT] described the proposed pitch fee increase as “huge” and explained that the proposal followed an earlier increase in April 2023 which, when accumulated, amounted to £31.12 per month over two years.

34. Mr [RESPONDENT] explained that in April 2023 the Applicant increased his pitch fee from £150.85 to £168.65 per month. Following ill health, Mr [RESPONDENT] was unable to object to the increase at that time.

35. Mr [RESPONDENT] was of the opinion that the Applicant had deliberately chosen a month with a high percentage CPI for maximum financial advantage. Furthermore, that the proposed rate exceeded the average monthly inflationary rise.

36. Mr [RESPONDENT] explained that he is a pensioner with limited financial means and relies on his state pension and pension credits. Furthermore, that the proposed increase would cause him financial hardship.

37. Mr [RESPONDENT] explained that other homes on the [NAME] have the benefit of more substantial sized pitches, some with garden areas. In comparison, Mr [RESPONDENT]’s pitch is considered small. The pitch extends to a car space and small courtyard garden on the southern elevation, and a 1 metre wide path to the northern and rear elevation.

38. Mr [RESPONDENT] said that he was caught “between the devil and the deep blue sea” as the pitch fee was becoming unaffordable but that attempts to sell his home earlier in the year had proven unsuccessful.

39. In response to questioning from the Tribunal Mr [RESPONDENT] agreed with Mr [RESPONDENT] description of the Park, adding that it is a “nice area, and quiet”.

Findings of Fact & Determination

40. The Tribunal finds that the Applicant is entitled by virtue of the implied terms contained within paragraph 17 of Part 1 of Chapter 2, of Schedule 1 to the Mobile Homes Act 1983 to undertake a late review of the pitch fee. In doing so, the annual review date of 1 September is preserved.

41. The Applicant served the pitch fee review Notice and prescribed form on the Respondent on 20 December 2023, with an effective date of 1 February 2024. The Tribunal finds that the Applicant was entitled to do so.

42. The Applicant proposed an increase in pitch fee in accordance with the percentage increase in the CPI. The Mobile Homes (Pitch Fees) Act 2023 changed the basis for calculating the pitch fees for park homes in England and Wales from the RPI to the Consumer Price Inflation (CPI) index with effect from 2 July 2023. The Tribunal therefore finds that the Applicant was correct in adopting the CPI methodology at the pertinent date.

43. The Tribunal finds that the Applicant adopted the correct CPI percentage of 7.9%, that being the June 2023 figure, published in July 2023.

44. The Tribunal is satisfied that the Applicants complied with the procedural requirements of paragraph 17 of Part 1 of Schedule 1 of the 1983 Act in this matter.

45. The Tribunal next turns its attention to the question as to whether the proposed increase in pitch fee is reasonable, irrespective of whether the sum payable is in itself reasonable.

46. The Tribunal reminds itself that paragraph 18(1) of the Act requires the Tribunal to determine whether there has been any deterioration in the condition and any decrease in the amenity of the [NAME] or any adjoining land which is occupied or controlled by the owner of the [NAME], and/or whether there has been any reduction in the services provided by the [NAME] and any deterioration in the quality of those services. Furthermore, whether any other weighty factors displace the presumption in favour of an inflationary increase in pitch fee calculated in accordance with RPI.

47. The Applicant asserts that they are entitled to a pitch fee increase in line with the appropriate CPI index and that the Respondent has provided no evidence as to why such is not reasonable.

48. The Respondent disputes the Applicant’s entitlement to an increase in pitch fee on the grounds of the totality of increase in pitch fee since purchase of his home, affordability of the proposed amount, and comparison with larger homes on [NAME] which benefit from more sizable plots.

49. Whilst the Tribunal has sympathy with the Respondent’s position, as described by Mr [RESPONDENT] both in written submissions and in-person during the hearing, the Tribunal is restricted to considering only those factors set out by statute and which extend to consideration of any deterioration in the condition of the [NAME] or any decrease in amenity, and/or, any reduction in services provided or deterioration in the quality of such services. Additionally, any other weighty factors which may displace the presumption in favour of an inflationary increase.

50. Having considered the Respondent’s submissions and the oral evidence provided, the Tribunal finds that none of the grounds advanced by the Respondent are those provided for by statute. Furthermore, the Tribunal does not consider the grounds to be sufficiently weighty to displace the CPI presumption.

51. The Tribunal finds that the Applicant adopted the correct CPI percentage and whilst not doubting the veracity of Mr [RESPONDENT]’s evidence concerning affordability, the Tribunal are unable to take account of the Respondent’s financial means.

The effect of the above determinations and the pitch fees

52. The first question to be addressed by the Tribunal is whether there should be any change from the pitch fee for 1 February 2024 onward and, if so, what that change should be.

53. Having considered the evidence and submissions before us the Tribunal are satisfied that it is reasonable that the pitch fee should be changed.

54. Turning next to the amount of increase in pitch fee, the Tribunal finds that the Respondent has failed to persuade the Tribunal that the presumption in favour of an increase in line with the relevant CPI should be displaced.

55. Accordingly, the Tribunal confirms the proposed pitch fees, payable with effect from 1 February 2025, is £181.97 per month.

56. Neither party made any submissions to the Tribunal concerning the application fee paid to the Tribunal by the Applicant.

RIGHTS OF APPEAL

1. A person wishing to appeal this decision to the Upper Tribunal ([NAME]) must seek permission to do so by making written application by email to [EMAIL] to the First-tier Tribunal at the Regional office which has been dealing with the case.

2. The application must arrive at the Tribunal within 28 days after the Tribunal sends to the person making the application written reasons for the decision.

3. If the person wishing to appeal does not comply with the 28 day time limit, the person shall include with the application for permission to appeal a request for an extension of time and the reason for not complying with the 28 day time limit; the Tribunal will then decide whether to extend time or not to allow the application for permission to appeal to proceed.

4. The application for permission to appeal must identify the decision of the Tribunal to which it relates, state the grounds of appeal, and state the result the party making the application is seeking.