DR Cathy Sherry of the Law department of UNSW was quoted in the Privy Council findings. Ironically, she doesn’t think allowing by-laws to restrict holiday lets is not the answer.
I am familiar with the appeal having talked to Tom Bacon about it and listened to the PC hearing online. The decision is not directly applicable in Australia, because as Tom said, the PC ceased to be our highest appeal court in 1986.
However, land and people are the same the world over; that is, we are all on land all of the time and land is a limited resource that cannot be infinitely shared.
The problems with investors, residents and tourists sharing land (ie Airbnb), are the same in any destination that is attractive to tourists. But, the oral argument and questions from the Bench in the appeal very much focussed on the wording of the by-laws in question, so it may turn on the facts of the case and have limited application elsewhere.
I think the case is the perfect example of why short-term letting should be determined by planning law, not private property law. The Turks and Caicos are small, poor islands and tourism is their major source of revenue. There are not unlimited places for tourists to stay because the land mass of the islands is small and tourist infrastructure is limited.
It may suit a large number of wealthy expats to own apartments there and keep them vacant for the majority of the year, but that would have a very damaging effect on the economy of the islands and the well-being of citizens.
The PC ruling that the Pinnacle by-law is valid won’t just mean the Pinnacle can ban short-term letting, it will mean that every strata scheme on the island can ban short-term letting with flow on effects for the economy.
The decision about how large swathes of land can be used should be made by the government of the Turks and Caicos Islands, not by private citizens and certainly not be expats. It is wrong to think that strata by-laws just regulate small sections of land (ie individual buildings).
If one strata scheme can ban short-term letting, all strata schemes can ban short-term letting. We cannot assess the legitimacy of private property law on an individual basis because that is not in fact how it operates. We have to assess its legitimacy on the way it actually operates, that is, potentially regulating tens of thousands of properties.
Airbnb is clearly a problem for residents and for cities, and the solution lies in planning law. It is entirely appropriate for planning law to ban or limit short-term letting in large areas of cities. It does not make sense for private citizens to have either the power or the responsibility for doing so.
Dr Cathy Sherry, Associate Professor, UNSW Law, Scientia Education Academy Fellow