1 Rocky Point Pty Limited v Chief Commissioner of State Revenue

Glenn v Federal Commissioner of Land Tax (1915) 20 CLR 490 DKLR Holding Co (No 2) Pty Ltd v Commissioner of Stamp Duties (NSW) (1982) 149 CLR 431 DKLR Holding Co (No 2) Pty Ltd v Commissioner of Stamp Duties [1980] 1 NSWLR 510 CASES CITED: Chief Commissioner of Land Tax v Macary Manufacturing Pty Limited (1999) 48 NSWLR 299 BBLT Pty Limited v Chief Commissioner of the Office of State Revenue 2003 ATC 5063 Whiting v Federal Commissioner of Taxation (1943) 68 CLR 199 Hunter Douglas Australia Pty Limited v Perma Blinds (1970) 122 CLR 49

Applicant Representative: I Young, barrister-at-law REPRESENTATION: Respondent Representative: A Rider, barrister-at-law

ORDERS: 1) Pursuant to section 101 of the Taxation Administration Act 1996, the assessment of the Chief Commissioner dated 17 January 2008 is confirmed. 2) Submissions regarding the parties' applications for costs of the hearing before Judicial Member Verick on 20 November 2009, and the Chief Commissioner's application for costs of the proceedings generally are to be filed within 28 days of publication, any submissions in reply are to be filed 28 days thereafter. The costs application will be determined on the papers pursuant to section 76 of the Administrative Decisions Tribunal Act 1997 unless either party objects within 7 days.

1 In these proceedings, 1 Rocky Point Pty Limited ('the company') seeks review of a decision by the Chief Commissioner of State Revenue to assess its liability to land tax for the 2008 tax year in respect of a parcel of land at Boulder Beach, Lennox Head. It says the assessment was wrongly made, because it held the land as trustee for its shareholder and director, Mr Holmes, who occupied it as his principal place of residence.

2 The matter has been listed for determination of a preliminary question of law, which the parties have formulated in the following way: 'If Mr Holmes occupied the property at Lennox Head as his principal place of residence at all relevant times in relation to the 2008 tax year, whether the Chief Commissioner's assessment of the Applicant's land tax liability dated 17 January 2008 in respect of the property was correct.'

3 The parties have agreed as follows. 1) If this question is determined in the affirmative, the Tribunal should grant final relief by way of an order confirming the assessment.

2. If it is determined in the negative, the proceedings should be listed for further hearing, to determine whether or not Mr Holmes occupied the property as his principal place of residence for the requisite period.

4 For the purposes of determining the preliminary question, the facts are not in dispute. On 4 March 2005, the company purchased the land at Lennox Head as agent for its sole director and shareholder, Mr Holmes, with monies supplied entirely by him. It became the sole registered proprietor.

5 As at the 'taxing date' of 31 December 2007, the company remained the sole registered proprietor of the land, and held the legal estate on resulting trust for Mr Holmes.

Jurisdiction 6 An objection to the assessment has been lodged with the Chief Commissioner and disallowed. For that reason, the Tribunal enjoys jurisdiction under section 96 of the Taxation Administration Act 1996 to review the assessment. The applicant company bears the onus of proving its case: section 100.

Applicant's case 7 The Applicant company submits that, despite its ownership of the legal estate, it was exempt from liability for land tax for the following reasons:

1. It did not 'own' the land, as required by section 7 of the Land Tax Management Act 1956 and defined in section 3, because, as a trustee under a resulting trust, it was neither 'entitled to an estate of freehold in possession', nor entitled to receive the rents and profits, as required by that definition. 2) If the company was an owner of the land, clause 2(3) of Schedule 1A of the Act deprived the Chief Commissioner of power to assess its liability to land tax in respect of the land. 3) That is so, despite the provisions of clause 11(1)(a) of the Schedule, which provides that the principal place of residence exemption does not apply if the land is owned by a company, because the operation of that clause was excluded by clause 11(6). Clause 11(6) operates in that way where a natural person is deemed by the Act to be the owner of land to the exclusion of a company. Here, clause 2(3) has that effect: it deems Mr Holmes to be the owner, to the exclusion of the Applicant company.

Respondent's case 8 In summary, the Chief Commissioner responds as follows:

1. The company held an estate of freehold in possession, because it had a present right of enjoyment of the land, as required by the decision of the High Court in Glenn v Federal Commissioner of Land Tax (1915) 20 CLR 490 at 496.

2. Clause 2(3) of Schedule 1A was not attracted, because it was expressed to operate only where 'the owner of land is entitled to the [principal place of residence] exemption'. That exemption was excluded in this case by clause 11(a) of the Schedule.

3. In the alternative, clause 2(3) was subject to the restrictions contained in Part 4 of the Schedule, including clause 11(a), whose effect was, inter alia , to deprive a beneficial owner of the benefit of the principal place of residence exemption where the owner of the legal estate was a company.

4. Properly construed, clause 2(3) did not deem Mr Holmes to be the owner of the land to the exclusion of the company, and clause 11(6) did not operate to preserve the principal place of residence exemption. Issues for determination 9 To answer the question of law formulated above, it is necessary to determine two issues:

1. Whether the company, as registered proprietor and trustee of a resulting trust, fell within the definition of 'owner' of the land in section 3 of the Land Tax Management Act 1956.

2. Whether Clause 2(3) of Schedule 1A of the Act operated to render the trustee immune from assessment, or to deprive the Chief Commissioner of power to assess its liability to land tax.

10 Each of these issues will be considered in turn.

Whether trustee was owner of land 11 Land tax is levied and payable on the taxable value of all land in New South Wales which is 'owned by taxpayers', except land which is exempted from taxation under the Act: section 7 of the Land Tax Management Act 1956. For each calendar year, tax is charged and levied on land as owned at midnight on 31 December the previous year: section 8. The Chief Commissioner is obliged to 'cause an assessment to be made of the taxable value of the land owned by any taxpayer and of the land tax payable thereon': section 14.

12 Section 24 of the Act provided, 'Any person in whom land is vested as a trustee shall be assessed and liable in respect of land as if he were beneficially entitled to the land …'.

13 'Owner' was defined relevantly in section 3 of the Act to include:

'(a) in relation to land, every person who jointly or severally, whether at law or in equity: (i) is entitled to the land for any estate of freehold in possession, or

(ii) is entitled to receive, or is in receipt of, or if the land were let to a tenant would be entitled to receive, the rents and profits thereof, whether as beneficial owner, trustee, mortgagee in possession, or otherwise ….'

14 The Applicant company argues that, as trustee of the land, it was not 'entitled to the land for any estate of freehold in possession', and enjoyed no present right to the rents and profits, even though it was the registered proprietor.

15 A similar argument was rejected by the NSW Court of Appeal in Chief Commissioner of Land Tax v Macary Manufacturing Pty Limited (1999) 48 NSWLR 299. In that case, a trustee company held lands of which it was the registered proprietor on discretionary trust. By the taxing date, the trustee had resolved to vest the corpus of the trust in Mr and Mrs Macary. In the trustee's submission, this 'left it as a bare trustee with the sole remaining duty to execute a transfer when called upon to do so by the appropriate beneficiaries [and precluded] the trustee from holding an estate of freehold in possession or from being entitled to the rents and profits' [per Mason P at 308].

16 For the purpose of its decision, the Court of Appeal was content to assume the resolution of the trustee had the effect of rendering it a 'bare trustee' of the land with the sole remaining duty to transfer the trust estate to the beneficiary on demand. The reasoning of the Court appears in the following passage from the judgment of Mason P, with whom Spigelman CJ and Sheller AJ agreed [at 309-312]. 'In my view, the Trustee was the "owner" as defined, under both arms of par (a) of the extended definition. As the registered proprietor of an estate in fee simple the Trustee was, by definition, "at law ... entitled to the land for [an] estate of freehold in possession" . The estate was in possession because the registered proprietor had a present right of enjoyment, as distinct from a reversion, remainder or expectancy ( Glenn v Federal Commissioner of Land Tax [1915] HCA 57 ; (1915) 20 CLR 490 at 498, 501, 507).

The registered proprietor of an estate in fee simple holds (at law) an estate in possession notwithstanding the imposition of a trust requiring the proprietor to hold that estate on behalf of beneficiaries. Nothing turns on whether the trust is active or bare. There will be an equitable estate or interest according to the terms of the trust. However, "an equitable interest is not carved out of a legal estate but impressed upon it" ( DKLR Holding Co (No 2) Pty Ltd v Commissioner of Stamp Duties (NSW) [1982] HCA 14 ; (1982) 149 CLR 431 at 474 per Brennan J). In other words, the recognition of a trust does not detract from the estate in possession enjoyed by the trustee at common law. Indeed, the full enjoyment of that trust interest depends upon the trustee's capacity to defend against third parties the plenitude of the legal estate vested in the trustee.

Hope JA illustrated the distinction in DKLR Holding Co (No 2) Pty Ltd v Commissioner of Stamp Duties [1980] 1 NSWLR 510 at 519-520:

'... [A]lthough the equitable estate is an interest in property, its essential character still bears the stamp which its origin placed upon it. Where the trustee is the owner of the legal fee simple, the right of the beneficiary, although annexed to the land, is a right to compel the legal owner to hold and use the rights which the law gives him in accordance with the obligations which equity has imposed upon him. The trustee, in such a case, has at law all the rights of the absolute owner in fee simple, but he is not free to use those rights for his own benefit in the way he could if no trust existed. Equitable obligations require him to use them in some particular way for the benefit of other persons. In illustrating his famous aphorism that equity had come not to destroy the law, but to fulfil it, Maitland, [Lectures on Equity, 2nd ed] at p17, said of the relationship between legal and equitable estates in land: "Equity did not say that the cestui que trust was the owner of the land, it said that the trustee was the owner of the land, but added that he was bound to hold the land for the benefit of the cestui que trust. There was no conflict here."

This relationship can, perhaps, be usefully illustrated by reference to the possession, and the right to possession, of land which is held by a trustee subject to a private trust. As a legal owner, and subject to any disposition of the right, such as would occur upon the granting of a lease, the trustee has at law the right to possession of the land and, unless somebody else is in possession, under him or adversely to him, he also has the legal possession of the land. He may maintain trespass against anyone who infringes that possession, and ejectment against any person who, without his consent, takes possession. At law a cestui que trust has no right to possession. He cannot sue the trustee at common law in ejectment .... . If the trustee holds as a bare trustee for a beneficiary absolutely entitled, that beneficiary is, in equity, entitled to put into possession if he so wishes, but he cannot sue the trustee in ejectment. His right can be enforced only by an order made in the exercise of the equitable jurisdiction of the court. If necessary, the court will, upon an appropriate indemnity being given, compel the trustee to allow the beneficiary to use his name to bring ejectment. When placed in possession by the trustee, at law the beneficiary is merely tenant at will of the trustee, the tenancy being determinable at law at any time on demand of possession by the trustee ... . As a corollary, the trustee might at law determine the beneficiary's tenancy and recover the land from him in an action for ejectment, and the beneficiary would have no legal defence. He would, of course, have an equitable defence which he has long been able, by statute, to plead in the action at law.'

See also Re Transphere Pty Ltd (1986) 5 NSWLR 309 ; Upper Hunter Timbers Pty Ltd v Commissioner of Stamp Duties (NSW) (1993) 93 ATC 4859 ; Commissioner of Stamp Duties for New South Wales v Buckle [1998] HCA 4 ; (1998) 192 CLR 226 at 242.

To the extent that Opalfield at first instance indicates otherwise, it was wrongly decided. Opalfield Pty Ltd was a shelf company that purchased land as nominee for members of the Allen family. It had no power to deal with the land except in accordance with the directions of the beneficiaries. The purchase was settled on 23 December 1991 but the plaintiff did not become registered until 1992. It was assessed for land tax based upon its ownership of the land on 31 December 1991. Sully J held that the plaintiff was a bare trustee within the principles expounded by Gummow J in Herdegen v Federal Commissioner of Taxation (1988) 84 ALR 271 at 281. Sully J also held that the company was not an "owner" within par (a) of the definition in s3(1) because it lacked a present right of beneficial enjoyment of the land. Nor was it a deemed owner within par (d) of the definition when read with s26(1)(a) (which refers to a purchaser in possession).

Opalfield came to this Court and the appeal was allowed. Sheller JA gave the leading judgment (with which Kirby P and Meagher JA agreed). He held that Opalfield Pty Ltd was "the purchaser" within s26(1)(a) and therefore the "owner" as at 31 December 1991. It was not to the point that the company purchased as nominee and held the benefit of the agreement for sale in trust for the members of the Allen family. Sheller JA addressed the argument that the company was exempt pursuant to s10(1)(r)(ii) (set out above, par 15) and held the exemption to have no application because "the owner" was a company (see s10(1D)).

In my respectful view Sully J in Opalfield and Black AJ in the present case elided two distinct legal concepts and, in so doing, erred when they held that a bare trustee does not fit within par (a) of the definition of "owner" because it has no present right of beneficial enjoyment. A trustee of the entire fee simple (ie where no future interest is involved) holds an estate in possession whether the trust is bare or active. It is beneficial in that (common law) sense. The legal estate confers a legal right to enjoyment or possession of the land and its rents and profits, even though the trustee may be compelled to hold that right for the benefit of the beneficiary. See also Kern Corporation Ltd v Walter Reid Trading Pty Ltd [1987] HCA 20 ; (1987) 163 CLR 164 at 191-2 (Deane J).

Griffith CJ recognised this distinction in the following passage in Glenn (at 498):

If, for instance, a testator gives land upon trusts for accumulation of the rents and profits during the life of A, and then upon trust for B in fee, the estate of freehold in possession both legal and equitable is in the trustees during the life of A, and B has no estate in possession. If the accumulation is to be for a term of ten years the result will be the same. So, in my opinion, if it is to continue until a certain sum has been accumulated. The fact that the term "in possession" is often used in contradistinction to "in remainder" or "in expectancy" does not, therefore, prove that there must always be in the case of trust property an equitable estate in possession held by some person other than the trustee. The essential element of an "estate in possession" is, in my opinion, that the owner of it has a present right of beneficial enjoyment, whether accompanied by physical possession of the land or not.

In Opalfield , Sully J cited the last sentence of this passage as if it stood for the proposition that the presence of a beneficiary with a present right of beneficial enjoyment of an estate deprived the trustee of the fee simple of the legal estate in possession. Reading the passage as a whole, Griffith CJ is not saying this. Glenn involved the equitable estate of the putative taxpayer. The Commissioner failed to establish that a beneficiary held even an equitable estate in possession during the period in which trustees were directed to accumulate a specified sum to be paid to the beneficiaries at the end of that period.

In any event Opalfield was distinguishable, because at the relevant date Opalfield Pty Ltd held its equitable interest (as purchaser under a settled contract for sale of Torrens land where the transfer in its favour had not yet been registered) in trust for nominees (the Allens) under what was found to be a bare trust. In those circumstances, there is authority for the proposition that the trustee of the bare sub-trust will "disappear from the picture" ( Grey v Inland Revenue Commissioners [1958] Ch 375 at 382, Chief Commissioner of Stamp Duties v ISPT Pty Ltd (1998) 45 NSWLR 639 at 647-51) in the sense that the equitable estate is held only by the sub-beneficiary. This may partially explain the result in Opalfield , but not (I think) the reasoning.

Similar reasoning leads to the conclusion that the Trustee was also an owner because, "if the land were let to a tenant [it] would be entitled to receive the rents and profits thereof ... as trustee" within sub-par (ii) of par (a) of the definition of "owner".

Nothing in the definition of "owner" in s3(1) suggests that there can only be one taxable owner of land at any point of time. Indeed, there are overwhelming indications to the contrary, because of the words "every person ... whether at law or in equity" and because of the group of persons deemed to be owners by virtue of par (d) of the definition.

A trustee is answerable as a taxpayer, obliged to submit returns and armed with various rights (s64). Section 24 provides that any person in whom land is vested as a trustee shall be assessed and liable in respect of land tax as if beneficially entitled to the land. The owner of an equitable estate or interest is also liable as if he or she were the legal owner (s25). Several provisions of the Management Act contemplate multiple taxable "owners" in respect of the same land at the same time (see ss23 , 24 , 25 , 26 , 27 , 30, 32). Double taxation is avoided through recognition of "primary" and "secondary" taxpayers, with the secondary taxpayer being entitled to a deduction for such amount (if any) as is necessary to prevent double taxation. As between the legal and equitable owner, the owner of the legal estate is deemed to be the primary taxpayer (s25). However, that owner's rights of recoupment, retention and indemnity are recognised by s64.

None of these provisions assists the Trustee's argument.' 17 In BBLT Pty Limited v Chief Commissioner of the Office of State Revenue 2003 ATC 5063, the Court of Appeal affirmed its decision in Macary. In BBLT, a trustee of land subject to a fixed trust, which was also the registered proprietor, was similarly held liable to land tax as its 'owner', as defined in section 3.

18 The decisions in Macary and BBLT are authority for the proposition that a registered proprietor of land which holds it on trust, even on a bare trust under which its only duty is to transfer the legal estate to the beneficiary on demand, enjoys an estate in possession, and is entitled to the rents and profits of the land, satisfying both limbs of the definition of 'owner' in paragraph (a) of the definition in section 3. They are illustrative of the principle that equity acts in personam.

19 Counsel for the Applicant submitted that the Court of Appeal in Macary had not fully appreciated the decision of the High Court in Glenn, which 'emphasized [that] there must be a "present" right to possession." He relied on the decision of the High Court in Whiting v Federal Commissioner of Taxation (1943) 68 CLR 199. In that case, the Court considered whether beneficiaries of certain will trusts were 'presently entitled to a share of the income of a trust estate' under sections 97 and 98 of the Income Tax Assessment Act 1936-1940. It found that a beneficiary was only so entitled where he or she was entitled to immediate payment of a share of the income of the trust estate, as distinct from having a vested interest.

20 That was not a case in which the High Court was considering a provision such as section 3 of the Land Tax Management Act 1956, by virtue of which an owner includes persons 'entitled to the land for any estate of freehold in possession', and which falls to be considered in this case. In any event, I consider that the Court of Appeal in Macary gave ample consideration and effect to the decision of the High Court in Glenn, as demonstrated in the passage extracted above.

21 Counsel for the Applicant also submitted that Macary should be distinguished on two bases. First, the Court of Appeal was considering the definition of 'owner' as it applied in the tax years 1988 to 1996, and had no regard - nor could it - to the provisions of Schedule 1A which were inserted on 31 December 2003 by the State Revenue Legislation Further Amendment Act 2003. Secondly, the Court of Appeal was considering an express, discretionary trust, rather than a resulting or implied trust which, as here, arises by presumption of law.

22 Turning to the first point of distinction, the statutory definition of 'owner', to the extent it is relied on by the Chief Commissioner and extracted above, has not changed since the decision in Macary. It has a long and distinguished history. It reproduces exactly the relevant provisions of section 3 of the Land Tax Assessment Act 1910 (Cth), as they stood when considered by High Court in Glenn v Federal Commissioner of Land Tax (1915) 20 CLR 490. The provisions concerning the principal place of residence exemption were placed in Schedule 1A long after Macary was decided. To the extent relevant, they are considered below. Though amended from time to time, they do not relevantly alter the definition of 'owner', or otherwise derogate from it.

23 Turning to the second point of distinction, it is correct that in Macary, BBLT and DKLR Holding Co (No 2) Pty Ltd v Commissioner of Stamp Duties [1980] 1 NSWLR 510, the Court of Appeal was considering express trusts, rather resulting or implied trusts. However, there is nothing in the reasoning of Mason P in Macary, or that of Hope JA in DKLR, which would confine their observations to the kind of discretionary trust considered in Macary, or to the declaration of trust in DKLR, or which would exclude the application of that reasoning to trusts arising by presumption or implication of law.

24 In Macary, the Court of Appeal was content to assume that the trust had ceased to be discretionary or 'active'. The principles in Macary were later applied to fixed trusts in BBLT [at 47-52]. Though the 'bare' trust considered in Macary was the remnant of a discretionary trust originally created expressly by deed, the Court was content to base its decision on the assumption that the sole remaining duty of the trustee was to transfer the legal estate to the beneficiary on request. In this case, the Applicant company as trustee was subject to a similar duty. The mere fact that its duty as trustee arose from a trust implied by law, as distinct from an express trust, is not productive of a meaningful distinction from the facts or reasoning in Macary.

25 For those reasons, the principles in Macary apply equally to a resulting trust of the kind now before the Tribunal.

Determination of first issue - whether trustee an 'owner' 26 It follows that the first issue should be determined in the affirmative. As at the taxing date, 31 December 2007, the company, as trustee and registered proprietor of the land, was an 'owner' within the scope of the definition in section 3 of the Land Tax Management Act 1956. As an owner, it was liable to land tax unless the land was exempt: section 7.

It is next necessary to determine whether the land was exempt from land tax by reason of the principal place of residence exemption.

Principal place of residence exemption - legislation 27 For the calendar year 2008, section 10(1)(r) provided that land attracting the 'principal place of residence' exemption under Schedule 1A was exempt from land tax.

28 Clause 2 of the Schedule provided: '(1) Land used and occupied by the owner as the principal place of residence of the owner of the land, and for no other purpose, is exempt from taxation under this Act, in respect of the year commencing 1 January 2005 or any succeeding year, if the land is: (a) a parcel of residential land, or

(3) If the owner of land is entitled to the exemption conferred by this clause, no other person is liable to be assessed for taxation under this Act in respect of the land during the period of the owner's entitlement to the exemption.

(4) The exemption conferred by this clause is referred to as the principal place of residence exemption .

(5) The principal place of residence exemption is subject to the restrictions set out in Part 4.'

29 For the purpose of determining the preliminary issue, it is assumed that Mr Holmes occupied the land at Lennox Head as his principal place of residence. As the holder of a beneficial interest in the land, he was an owner. For that reason, the Applicant argues that the land attracted the exemption in clause 2(1), and clause 2(3) operated to render the trustee immune from assessment to land tax.

30 However, clause 2(5) provided that the principal place of residence exemption was 'subject to the restrictions set out in Part 4'. These included clause 11(1)(a), which provided: '11(1) Land is not exempt from taxation under the principal place of residence exemption if:

(a) the land is owned, or jointly owned, by a company, unless the land is owned or jointly owned by a trustee company acting in its representative capacity or a company acting in its capacity as trustee of a concessional trust, …'

31 It is common ground that the Applicant was not a trustee company or a company acting as trustee of a concessional trust, within the meaning of those terms as they appear in clause 11(1)(a).

32 The effect of clause 11(1)(a), where it applies, is to preclude the principal place of residence exemption from applying to land. As the Applicant was a 'company' which 'owned' the land within the meaning of that clause, the operation of the clause was attracted, subject to any other overriding statutory provision. The express terms of clause 11(1)(a) disclose Parliament's intention to exclude the operation of the principal place of residence from lands owned, wholly or in part, by a company.

33 The principal place of residence exemption in clause 2(1) was expressed to exempt land from tax, rather than the owner. The exemption applied to land only where its owner satisfied the requirements of the clause. Clause 2(3) did not, in terms, affect the land directly. It operated only to render a taxpayer immune from assessment or, put another way, to preclude the Chief Commissioner from assessing his or her land tax liability. Thus, the Applicant says, the operation of Clause 2(3) would be preserved, even if clause 11(1)(a) operated to exclude the land at Lennox Head from the principal place of residence exemption.

34 However, clause 2(3) was expressed to operate only 'if the owner of land is entitled to the exemption conferred by this clause' - that is, to the principal place of residence exemption. The effect of clause 11(1)(a), where it applied, was to remove from all owners of the land the benefit of that exemption. Where the exemption did not apply, clause 2(3) had no operation. It follows that any benefit or immunity it conveyed could not operate where clause 11(1)(a) was attracted - for instance, because a company was an owner of the land.

35 The Applicant argued that clause 11(1)(a) was itself excluded by clause 11(6), which provided: '(6) This clause does not prevent the principal place of residence exemption applying to land owned by a company if a provision of this Act deems a natural person to be the owner of the land, to the exclusion of the company.'

36 It argued that clause 11(6) was attracted because clause 2(3) deemed Mr Holmes 'to be the owner of the land, to the exclusion of the company'. In support of this proposition, it relied on the meaning ascribed to the word 'deem' by in Hunter Douglas Australia Pty Limited v Perma Blinds (1970) 122 CLR 49. In that case, Windeyer J said [at 65]: '… to deem means simply to judge or reach a conclusion about something. A judge, or a juryman, is a deemster, although except in the Isle of Man, that name has long been archaic. The words "deem" and "deemed" when used in a statute thus simply state the effect or meaning which some matter or thing has - the way in which it is to be adjudged. This need not import artificiality or fiction. It may simply be the statement of an indisputable conclusion, as if for example one were to say that on attaining the age of twenty-one years a man is deemed to be of full age and no longer an infant.'

37 The word 'deem' is not used in clause 2(3). Even adopting His Honour's broad meaning of the term, there is nothing in that clause which has the effect of deeming Mr Holmes or anyone else to be the owner to the exclusion of the company. Where it operates, the clause merely renders a person immune from assessment, thus protecting them from one of the many consequences of ownership. It does so expressly, and not by means of deeming the person to be excluded from ownership, or otherwise not to be an owner of land.

2. that clause 11(1)(a) operated to exclude the principle place of residence exception from its application to the land at Lennox Head,

4. that the operation of clause 2(3) - which might otherwise have rendered the trustee immune from assessment - was not attracted.

Determination of second issue - whether power of assessment affected 39 For the reasons stated, the second issue should be determined in the negative. Clause 2(3) of Schedule 1A of the Act did not render the company immune from assessment, or deprive the Chief Commissioner of power to assess its liability to land tax.

Determination of preliminary question 40 For these reasons, the Tribunal determines the preliminary question of law in the affirmative as follows: If Mr Holmes occupied the property at Lennox Head as his principal place of residence at all relevant times in relation to the 2008 tax year, the Chief Commissioner's assessment of the Applicant's land tax liability dated 17 January 2008 in respect of the property was correct.

Orders 41 The Tribunal makes the following orders:

1. Pursuant to section 101 of the Taxation Administration Act 1996, the assessment of the Chief Commissioner dated 17 January 2008 is confirmed.
2. Submissions regarding the parties' applications for costs of the hearing before Judicial Member Verick on 20 November 2009, and the Chief Commissioner's application for costs of the proceedings generally are to be filed within 28 days of publication, any submissions in reply are to be filed 28 days thereafter. The costs application will be determined on the papers pursuant to section 76 of the Administrative Decisions Tribunal Act 1997unless either party objects within 7 days.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.