Park homes – Water charges – Water Resale Order 2006 – Appellant owning mobile home park – Respondent home owners seeking determination that appellant overcharging for water – First-tier tribunal finding appellant overcharging and directing refund – Appellant appealing – Whether first-tier tribunal having jurisdiction to determine breach of 2006 Order – Whether estimated charges based on previous year resulting in overpayment recouped in subsequent year in breach of 2006 Order – Appeal allowed in part
The appellant was the owner of over 50 mobile home parks, at 28 of which it was a water “re-seller”, i.e., any person who was not a water undertaker but who provided, from water supplied to it by a water undertaker, a supply of piped water to the resident of a dwelling: see article 5 of the Water Resale Order 2006. The effect of article 6 of the Order was that a water re-seller might not charge more for the water it supplied to domestic purchasers than it was charged by its own supplier (plus a small administration charge of about £5 a year).
Beechwood Park was a protected site under the Mobile Homes Act 1983, which provided permanent pitches for 92 mobile homes. The appellant acquired the site on 15 May 2015. Each pitch was occupied under the terms of an agreement between the appellant’s predecessor, as park owner, and the resident of the mobile home. The agreement included an express undertaking by the resident to pay all charges for electricity, gas, water etc. The agreement said nothing about the frequency or quantification of those charges.
On 20 October 2016, the respondent owners of 63 homes on the park sought a determination that the appellant had overcharged for water supplied to them. The appellant applied to the first-tier tribunal (FTT) to dismiss the application on the grounds that it had no jurisdiction to determine whether overcharging had occurred. The FTT disagreed and refused to strike out the defendants’ application, declining to follow an earlier decision on which the appellant had relied: see Duke and others v Wyldecrest Parks (Management) Ltd (unreported, 25 April 2013). The FTT found that the appellant had charged each resident £148.75 more than it had itself paid for the water it supplied, in breach of article 6 of the 2006 Order, and directed that the amount overcharged should be credited to the residents’ accounts or refunded within 28 days.
The appellant appealed. The issues were whether the FTT: (i) had jurisdiction to determine disputes about overcharging for the supply of water; (ii) was correct to find that the appellant was in breach of article 6 of the 2006 Order; and (iii) was correct to direct repayment of the sum overcharged when the overpayment had been recouped by residents as a result of lower monthly charges set by the appellant from 1 April 2016.
Held: The appeal was allowed in part.
(1) The FTT came to the correct conclusion on the issue of jurisdiction. By section 4(1) of the 1983 Act the FTT had jurisdiction, in England, to determine “any question arising under this Act or any agreement” to which the Act applied and to “entertain any proceedings brought under this Act or any such agreement”. The pitch agreements at the Park were agreements to which the 1983 Act applied. The obligation to pay for water consumed on the pitch was imposed by the pitch agreement, and not by the 2006 Order. In ordinary language, the question of how much an occupier was obliged to pay for water was an issue which “arises under” the agreement, and the proceedings commenced by the defendants in the FTT were “brought under” their agreements, because the obligation to pay the charge was imposed by the agreement. Once the water had been paid for, the question whether more had been paid than was properly due also arose under the agreement, as well as proceedings for its recovery.
The effect of para 6(2) of the 2006 Order was to limit the sum which might be charged by a re-seller for water it supplied to domestic customers. When determining whether such customers had been charged too much for their water, the 2006 Order had to be taken into account but that did not prevent the determination of the water charges properly payable by the residents in this case from being a question arising under their individual agreements. Section 4 of the 1983 Act gave effect to a clear policy that disputes concerning the rights and obligations of the occupiers of mobile homes (except those relating to the termination of agreements, which were allocated to the County Court by section 4(3)) should be determined in tribunals rather than in courts. The language of section 4 was very broad, and the enhanced powers conferred by section 231A of the Housing Act 2004 Act were extensive and expressed in general terms. Therefore, with the exception of disputes over termination, the proper forum for the resolution of contractual disputes between park home owners and the owners of protected sites in England was the FTT: Duke v Wyldecrest Parks (Management) Ltd (unreported, 25 April 2013) not followed.
(2) By the time of the FTT’s substantive decision, a small underpayment had built up over the whole of the appellant’s period of ownership. No payment was therefore due to the residents, nor was any such payment due at the time the FTT directed that each resident should receive £148.75 within 28 days. If the FTT was aware that the overpayment had already been wiped out, it was clearly wrong to order an immediate repayment, but the court assumed that was not the case. If the FTT did not appreciate the state of the account, it fell into inadvertent error. In either case the appeal against the order for repayment made by the FTT had to be allowed.
(3) The 2006 Order did not specify the period in respect of which any excess charge should be calculated, nor did it identify when a re-seller would be in breach. Article 6(2) prescribed a moderately complicated method for calculating the maximum charge payable by a purchaser whose own supply was not metered; unless a higher charge was justified the maximum was the average bill payable by the water undertaker’s own domestic customers, determined by ascertaining the sum paid by the reseller, deducting any metered supplies and then apportioning the balance amongst all unmetered purchasers by reference to the size or number of occupants in each of the affected purchasers’ dwellings. It was likely that in many or most cases the maximum sum would not be known until some time after the water had been supplied. Given the lack of precision surrounding charging for water, the tribunal was not prepared to say that a method of charging which the FTT found to be reasonable, which the residents of the park agreed was reasonable, and which was said to operate without difficulty in a large number of protected sites, amounted to a breach of the 2006 Order simply because in one period of 10 months it resulted in the residents paying more than the maximum charge. The fact that an overcharge occurred gave rise to a right to recover the overpayment under article 10, but in this case recovery had taken place. In the circumstances of this case, the FTT should not have described the appellant as having breached the 2006 Order, and its appeal against that part of the decision would be allowed.
The appellant appeared by its estates director; the respondents appeared in person.
Eileen O’Grady, barrister
Click here to read transcript: Wyldecrest Parks (Management) Ltd v Santer and others
