Expert of the day, Gary Rycroft, on why caravan parks are causing consternation
Top independent legal expert Gary Rycroft and Resolver’s own Martyn James have been flooded with enquiries in the last week about caravan parks, rental charges and refunds. Millions of people own or rent caravans – and alongside pet insurance, caravan problems often prompt the most passionate responses. So when thousands of people found that they were not going to get any refunds from caravan parks for annual fees there was a huge response.
So Resolver asked Gary for his top legal tips on your rights with caravan park contracts. But first, here’s Martyn with the key facts.
Martyn asks – what’s the problem?
Caravanning is a big deal to us Brits. It’s conservatively estimated that there are 555,000 touring caravans. 365,000 caravan holiday homes and 2,500 static caravan parks in the UK alone.
There are various kinds of caravan park, from those with stationary caravans onsite permanently to those catering to traditional caravans and motorhomes. In addition, because of insurance restrictions, if you can’t keep a caravan on your porch, you have to store it safely offsite when not in use, so there’s a whole ‘lock up’ for caravans too.
Because of travel restrictions and other lockdown issues, people with caravans in parks or lock ups can’t get to the vehicles – but they’re being asked to pay the full annual ‘rent’ or being declined any kind of refund. These costs can be considerable. £4,000 to £5,000 seems to be average.
The majority of complaints involve people who have contacted the park owners for refunds but been told flat out that the contract doesn’t cover this. While some parks are small businesses, there’s a lot of big businesses in this area too. Most caravan owners are pragmatic. They accept that they will have to pay for some things, like security, maintenance of facilities, etc. But given they can’t even go to the caravan; they feel that they should be entitled to some degree of refund. But most are being told no.
Gary Rycroft on the big questions about caravan parks and refunds
Like other hospitality business, caravan sites have been closed to members of the public since the lockdown began – and at this stage, there is no definite date for this restriction to be lifted. This has led to caravan owners who rent caravan pitches from site owners to wonder what rights they have when asking for a refund on pitch fees which have been paid in advance. Here are some common questions which have been raised with my thoughts on the answers:
I can’t visit my caravan, which is pitched on a site where I pay fees in advance – but the site owners won’t let me have a refund. What is the legal position?
Like loads of other issues that have arisen since the lockdown, there is no absolute certainty about the legal position in this sector. But in very general terms, my view is if the caravan site is unable to provide you with the service which you have paid for then there should be some legal redress.
Most caravan sites use a standard form of licence agreement promoted by the British Holidays and Home Parks Association (BH&HPA) which represents owners and managers of over 2,000 holiday and touring parks who between them provide over 340,000 pitches for holidaymakers. The BH&HPA Model Licence Agreement places much emphasis on the fact that the purpose of the agreement is to allow caravan owners to pitch their caravans on the site in order to enjoy a holiday (not living on-site).
Because of this, my view is there is a strong argument to say that the contract has been “frustrated”. This is known (rather dramatically) as ‘the Doctrine of Frustration of Contract’. It’s a well-established legal principle and so people should be put back into the position they were in (I’m paraphrasing a bit here!) So in other words, the caravan owners should be refunded in full by the caravan site owners for the period of time which the caravan pitch may not be used for.
But what if the caravan site owners say that they are still providing services such as cutting the grass and carrying out work to the caravan site in general?
Caravan site owners ultimately decide what expenditure they incur on their own sites. But clearly site owners will have less to do at the moment in terms of servicing the pitches. This may be an opportunity for site owners to carry out improvement works, but this isn’t necessarily relevant nor should these additional costs be billed to the individual caravan owners. I mentioned the Doctrine of Frustration of Contract before – and if we apply that then in theory the contract is effectively null and void. So the caravan site owners would not be able to claim any expenditure that they have incurred during the time which the contract wasn’t ‘running’.
So, there are arguments on both sides with caravan owners themselves saying that they cannot access the sites and caravan site owners saying that they are still providing services. What would be a reasonable compromise?
I think that both sides should recognise that there are strong arguments on either side. My own view is that the caravan owners themselves have a particularly strong argument with regard to the Doctrine of Frustration of Contract. So, I think that caravan site owners should be open to reaching a compromise whereby there is a partial refund of pitch fees for those weeks where the site may not be accessed.
If some work has been carried out on the site such as grass cutting, the caravan site owners may wish to include that in a calculation with regard to what it would be fair to refund, but I do not think that caravan owners should be having to share the costs of works carried out on the sites which are being done whilst the site is closed.
Has the Government said anything that would be helpful to caravan owners who are seeking a refund?
There is nothing specific in the Government’s published guidance about COVID-19 but the Competition and Markets Authority (CMA) has made a statement about situations where businesses are unable to deliver services because of COVID-19 restrictions.
The CMA has said that for most consumer contracts, [we] would expect a consumer to be offered a full refund where … a consumer cancels or is prevented from receiving any services because Government public health measures mean that they are not allowed to use the services.
Alternatively, the BH&HPA takes the view that a Licence Agreement for a caravan pitch is not an agreement to rent a holiday caravan to a consumer. They say it is a licence for the provision of the pitch to site the caravan (which the consumer usually owns) and for the maintenance of the park and its utilities infrastructure to supply the caravans.
So in short, in one sense the provision of some services by the site owners may be ongoing. But I would also say that in line with the CMA guidance the site can’t be accessed by the caravan owners. So I think that the CMA guidance is helpful to caravan owners who are seeking a refund. This is also the view of the Northern Irish Government as per advice they have published on their website.
In short, ask for a refund but acknowledge that some costs for the services the site owners are providing could/should be deducted.
I tried this and the firm said no. What can I do?
I’m afraid your options are limited. You could take legal action, though as always think about this and the costs carefully first. On the Law Society website, there is a “Find a Solicitor” tool where you may find solicitors who specialise in commercial litigation.
You may also be able to locate a solicitor through any home insurance policy you have which offers “Legal Expenses Cover” so that the initial cost of taking legal advice may be covered under that policy.
You can report the firm to the CMA on their website here.
Gary Rycroft is one of the UK’s leading lights when it comes to all things legal and is a regular broadcast commentator and expert. He’s a partner at Joseph A Jones & Co Solicitors and over the years has been a member of various leading committees at the Law Society and is currently Chair of their Digital Assets Working Group.
If you’re having a problem with any issues arising from the lockdown, don’t suffer in silence – get in touch. Resolver can help you make your complaint for free. Get started at www.resolver.co.uk