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As a caravan park owner, it is crucial to have a clear understanding of how consumer laws apply to your business, especially when it comes to holiday parks selling caravans and lodges for private ownership. This overview aims to provide practical insights into the application of consumer laws, highlighting situations that are more or less likely to breach these regulations. It's important to note that this guidance does not cover residential parks governed by the Mobile Homes Act 1983.
The guidance begins by explaining the two primary contracts commonly used in the holiday park industry: the purchase agreement for the holiday caravan or lodge and the pitch licence agreement. It highlights key points regarding the use of variation terms, such as making changes to pitch fees. It emphasises the importance of ensuring that all terms in the contract are clear, unambiguous, and fair for the consumer. Unfair terms can have significant implications for the operation of your contract with consumers and may impact other similar contracts you have entered into. To assist you in assessing the clarity of your contracts, a helpful checklist is included:
Business Companion (2023) 'Holiday parks: Make sure your business complies with consumer law' The Chartered Trading Standards Insititute: Basildon
The guidance provides practical examples to illustrate when the main pieces of legislation affecting holiday park owners are likely to apply to the sector. These examples cover various aspects, including sales and marketing information, misleading practices, pricing, and promotions. It also clarifies the relationship between holiday park owners and holiday caravan/lodge owners. Key considerations addressed in this context include:
Standards of Behavior: Outlining expectations for behaviour and conduct within the park to ensure a pleasant and safe environment for all parties involved.
Pitch Fees: Addressing the terms and conditions related to pitch fees, including any provisions for changes or adjustments over time.
Termination of Pitch Licence Agreement: Explaining the circumstances under which a pitch licence agreement may be terminated by either party and the associated procedures.
Improvements to Pitch by Owners: Providing guidance on owners' rights and obligations regarding making improvements or modifications to their pitches.
Selling or Transferring of Holiday Caravans or Lodges: Clarifying the process and requirements for owners who wish to sell or transfer their holiday caravans or lodges.
By examining these practical examples, holiday park owners can gain a better understanding of how the relevant legislation applies to their specific situations.
According to the Consumer Rights Act (CRA), certain terms that aim to exclude or limit your liability under consumer law are automatically considered unfair and are not binding on the owner. In the caravan sector, relevant terms may include:
Excluding or restricting liability under the CRA for goods sold to the owner, such as:
Denying liability when the holiday caravan/lodge is unfit for purpose or defective.
Denying liability for problems with the holiday caravan/lodge caused by your staff or subcontractors during siting.
Stating that only the manufacturer is responsible for any faults with the holiday caravan/lodge.
Excluding liability for the workmanship of subcontractors you have employed to carry out agreed work for the owner. The CRA states that such work should be performed with reasonable care and skill.
Restricting liability for death or personal injury caused by the negligence of you, your staff, or subcontractors working on your behalf.
Preventing owners from relying on any pre-contractual statements made by your staff.
The CRA includes a list of 20 terms known as the "grey list", which may be considered unfair but are not automatically unfair. However, it's important to evaluate these terms based on the specific circumstances of the contract. Here are two examples from the grey list:
A term is not allowed if it limits or takes away any rights a consumer has. This includes not being able to use their claim against the trader to pay for something they owe the trader.
Misleading actions are when the information given to consumers is wrong, or even if it's true, it is presented in a way that makes people make decisions they wouldn't have made otherwise. It also includes not sharing important details that consumers need to make good decisions. If these practices cause or could cause people to make different choices, then they are seen as misleading.
Traders should provide clear and unambiguous price information for holiday caravans and lodges. Any fees that the potential owner needs to pay when purchasing a holiday caravan or lodge must be prominently displayed and clearly indicated as part of the initial purchase price. If the pitch fees vary depending on the chosen pitch, this should be clearly communicated, and the potential owner should have access to information about the actual fee before committing to the purchase. All prices should include VAT.
The below table describes the information traders can use regarding price promotion:
To read the full guidance from Business Companion click here.
Understanding contract law and fair-trading legislation is vital for holiday park owners and operators to maintain fair and transparent relationships with consumers. This guidance equips you with the necessary knowledge to navigate these legal aspects effectively. By ensuring clear and fair contracts, and adhering to relevant legislation, you can foster positive experiences for both your customers and your business.
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