Many residential park operators are in or nearing the end of their review process. You need to be sure that you have lawful grounds for reviewing the pitch fee in the way you are proposing. Here are some things to bear in mind.
What things can I take into account when reviewing the pitch fee?
– There is a presumption that the pitch fee may increase or decrease in line with the change in RPI unless that would be unreasonable having particular regard to matters. These include whether there have been any improvements carried out on the park (which have been consulted on with the residents in accordance with the written procedure in the implied terms), any change brought about by an enactment (but excluding changes to park home law) or any decrease in the amenity of the park since 26 May 2013 unless previously been taken into account. Loss of amenity was expanded upon by the Mobile Homes Act 2013 and may include any decrease in the quality of the services on the park and any direct effect on the maintenance or management costs.
– Under the new site licensing regime, the annual site fee was found in a recent tribunal decision to be recoverable when reviewing the pitch fee because it’s a direct effect on the costs payable by the park owner in relation to the maintenance and management of the site. This tribunal decision said that the amount should in effect be ring fenced from the pitch fee and therefore should not be subject to changes in RPI and should be increased or decreased depending on the annual fee which the local authority charge.
How should I review the pitch fee?
– You should give notice of the pitch fee review 28 days before the review date but it’s not disastrous if you review the pitch fee late. It will just mean that the new amount will not become payable until 28 days after the notice has been served.
– Notifying residents of a review means writing to the residents saying what your proposal is AND completing and enclosing with your letter the prescribed pitch fee review form. The letter must have the park owner’s name and address on it and the form must be signed by the park owner (or say a director of the park owner company) in order to avoid any problems in the future. Failing to use the form (all 8 pages of it) means that there will not have been a valid review and the residents, even if they pay the new amount are entitled to bring a claim for the recovery of the overpayment and you will be obliged to reimburse them. There has been a tribunal decision where the tribunal chairman said using the pitch fee review form only was sufficient but as a tribunal decision at this level is not binding on others it’s best to err on the side of caution.
– If you are reviewing in line with RPI you must use the last published RPI figure before the review date in your agreements even if you are reviewing the pitch fee late and the next month’s RPI figure has already been published.
Keep your pitch fee proposals letter simple. The pitch fee review form can be accessed here.
What if residents do not pay the new amount?
– Remember, the pitch fee can only be changed with the agreement of the resident or because the tribunal has made an order entitling you to change it. Often, residents forget to change their standing order and continue paying the “old” pitch fee and may not be genuinely disputing the new amount. It does not help that the pitch fee review form says that residents do not need to say or do anything if they dispute the review apart from keep paying the last agreed pitch fee.
– The problem is that there is only a very limited period of time in which to make an application to the tribunal for a determination and within this time it is not always easy to establish who is in agreement with the new pitch fee but has just forgotten to pay it and who is genuinely disputing it.
– The key is to keep track of the pitch fee payments within the first two months of the review date. Some residents will of course, tell you if they disagree with the pitch fee and give their reasons for doing so – so you will know where you stand with them. With others, gentle reminders that the pitch fee has been reviewed and to remind them to change their standing order may be appropriate. If you continue to receive the old amount, the resident should be treated as being in dispute and to protect your position, an application should be made to the tribunal because if you don’t, you will lose the right to charge the new amount as against that resident. Of course, you should warn the resident(s) concerned of your intention to apply to the tribunal.
– If the pitch fee review notice and form has been served 28 days before the review date, the time period for making an application to the tribunal is 3 months from the review date. Therefore, if you served your pitch fee proposal 28 days before the 1 December 2014 review date the deadline for getting your application to the tribunal is 28 February 2015. If you were late in serving the notice, it’s 4 months from the date the proposals were served.
Make sure you diarise key dates for reviewing the pitch fee payments into your account and in particular the last date for the tribunal to receive your application. If you do not know where to send the application, check at – https://www.justice.gov.uk/contacts/hmcts/tribunals/residential-property.
The Mobile Homes Act 2013 introduced a number of changes to the pitch fee review provisions in the implied terms. We regularly help clients with their pitch fee reviews from start to end – from advice and guidance on improvements to addressing any grounds received for disputing the pitch fee and representation in the tribunal. We can help whatever the stage you are at. For more information please email email@example.com or call 01392 210700.