Falvo v The Chief Commissioner of State Revenue

NCAT Administrative and Equal Opportunity|2016-02-16

Solicitors: HK Husseini & Co (Applicant) Crown Solicitor's Office (Respondent) File Number(s): 1410697

Reasons for decision

In these proceedings, Ms Falvo who was a successful applicant for a First Home Owner Grant and a First Home Owner Boost under the First Home Owner Grant (New Homes) Act 2000 ("the FHOG Act") seeks review of an assessment dated 21 July 2014 requiring her to repay the grant and boost including a 60% penalty in respect of a property situated at Collaroy.
Essentially, the assessment was issued by the Chief Commissioner on the grounds that Ms Falvo failed to satisfy the residence requirement to be entitled to the grant and boost.
For purposes of this application, the relevant eligibility criterion was the fifth criterion set out in Part 2 of Division 2 of the FHOG Act which was, at the relevant time, in the following terms: 12 Criterion 5 - Residence requirement (1) An applicant for a first home grant must: (a) commence occupation of the home to which the application relates as the applicant's principal place of residence within 12 months after completion of the eligible transaction or the period approved by the Chief Commissioner under this section, and (b) occupy the home as a principal place of residence for a continuous period of at least 6 months or the period approved by the Chief Commissioner under this section. (2) This requirement is referred to in this Act as the residence requirement. (3) The Chief Commissioner may, if satisfied there are good reasons to do so, do either or both of the following: (a) approve the commencement of occupation by the applicant of the home to which the application relates as a principal place of residence more than 12 months after completion of the eligible transaction, (b) approve the occupation of the home as a principal place of residence for a period of less than 6 months. (4) The Chief Commissioner may, if satisfied there are good reasons to do so, exempt an applicant from the residence requirement. (5) An approval or exemption under this section may be given by the Chief Commissioner at any time, even if the period of 12 months after completion of the eligible transaction has already expired or the applicant's occupation of the home as a principal place of residence has already ceased. (6) If the application is made by joint applicants and at least one (but not all) of the applicants complies with the residence requirement, the non-complying applicant or applicants are exempted from compliance with the residence requirement.

Factual Background

The Collaroy property was acquired on 22 December 2009 from a company whose directors and shareholders at the relevant time were Ms Falvo's parents.
Ms Falvo had, on 1 October 2009, lodged an application for the grant and boost to acquire the Collaroy property. She received on 18 November 2009, an amount of $14,000 paid to her as the grant and boost. The payment was made pursuant to s 20(1)(b) of the FHOG Act that provided the Chief Commissioner with a statutory power to authorise the payment of a grant/boost in anticipation of compliance by an applicant with the residence requirement.
On 26 November 2010, Ms Falvo informed the Chief Commissioner that she had lived in the Collaroy property during the relevant period and provided the Chief Commissioner with copies of the following documents: 1. Her Commonwealth Bank statement for the period 1 December 2009 to 26 February 2010; 2. Her ING statement for period 1 January 2010 to 31 March 2010; 3. An Optus invoice dated 25 November 2009; and 4. An Energy Australia invoice addressed to her for the period 22 February 2010 to 25 May 2010 in respect of the Collaroy property.
On 11 April 2014, the Chief Commissioner commenced an investigation to ascertain whether Ms Falvo had complied with the residence requirement. The Chief Commissioner issued to her a Notice of Investigation pursuant to Division 2 Part 3 of the FHOG Act requiring her to complete and return a "Residency Confirmation - Statutory Declaration".
There was no response from Ms Falvo and the Chief Commissioner sent a further copy of the Notice of Investigation dated 11 April 2014.
There was also no response to this further notice.
On 21 July 2014, the Chief Commissioner issued to Ms Falvo a Notice of Assessment, requiring repayment of the grant and boost. The Chief Commissioner also imposed a penalty of 60%. Section 45 of the FHOG Act at the relevant time provided the Chief Commissioner with power to require an applicant for a FHOG grant/boost to repay the amount given if the Chief Commissioner reversed the decision under which the amount was paid, and also to impose a penalty.
On 16 September 2014, Ms Falvo lodged an objection against the assessment on the ground that she had "lived in the property but have rented rooms out that were not needed by me throughout my entire ownership".
The objection was disallowed on 8 October 2014.
On 8 December 2014, Ms Falvo filed this application for review of the Chief Commissioner's assessment.

Chief Commissioner's Investigation

The investigation conducted by the Chief Commissioner indicated that Ms Falvo had recorded with various authorities her residential address of another property also situated in Collaroy, which was owned by her parents. These authorities included the Electoral Roll Commission, NSW Roads and Maritime Services (RMS Database) and Department of Immigration on incoming passenger cards in 2013 and 2014.
The investigation also indicated that persons other than Ms Falvo had resided at the Collaroy property during the relevant period.
Searches by the Chief Commissioner of the Rental Bond Board database indicated a rental bond for the Collaroy property was lodged on 30 October 1998 by "J Kruse and N Taubman" as tenants, which was refunded in November 2013.
Searches undertaken by the Chief Commissioner of the RMS database indicated that, from 21 May 1999 to 18 October 2013, Ms J Kruse's licence details recorded her address as the Collaroy property.
Information produced by True Energy pursuant to a notice under s 36 of the FHOG Act indicated that electricity at the Collaroy property was connected in the name of "Josephine Kruse" from 2 October 1998 to 21 February 2010.

Applicant's Evidence

At the hearing Ms Falvo and her mother gave evidence and were cross-examined.
Her mother's evidence was that, sometime on 30 and 31 December 2009, she and husband helped to "move" their daughter's belongings from their home to the Collaroy property. The belongings consisted of a bed (which was assembled by them at the Collaroy property), a table, a TV and few other things.
She also stated that, in the Italian tradition, she had provided each of her daughters with a residence and that, in that tradition, the Collaroy property was provided for Ms Falvo.
Ms Falvo's own evidence was that she "moved into" the Collaroy property on 31st December 2009 and occupied "Bed 3". The personal property that she moved into the Collaroy property with the help of her parents included her "bed and mattress, a bedside table, wicker baskets, a small television as well as my clothes, shoes, accessories, toiletries and a couple of sentimental soft toys".
Ms Falvo's further evidence was that an agreement with Ms Kruse "to share the house" with her "as a tenant" was put into place by her mother "as they had a previous landlord/tenant relationship". The rent was paid by Ms Kruse directly to her mother to "pay off" Ms Falvo's loan with her parents. And that Ms Kruse paid all gas and electricity bills but Ms Falvo would "leave" cash to cover her share of each bill.
Ms Falvo also in her written statement, stated that: 15. a) I was generally at my boyfriend's house most evenings. b) On a standard night I would arrive to my boyfriend's house anywhere between 8pm and 10.30pm (sometimes later, this is just a guide) and leave around 12am - 3am. The reason I would arrive late to his house is I had a busy schedule as I would go to the gym and shower then go to Coles/Woolworths and collect food for dinner for that evening or go out and meet friends for dinner/coffee, occasionally I would also pop into my parents' house. 16. a) I was present at the property almost every day. b) I would be at the property most evenings/mornings after my boyfriend's house anywhere from 12am to 3 am until I would leave to go to the gym most mornings at around 7 or 7.30am, I would get ready for work at the gym as it was easier.
Ms Falvo also relied on her Statutory Declaration sworn on 5th August 2015 where she declared as follows: I moved into the above address in late 2009. I was aware that my mother Carmel Falvo had a written agreement with Josephine Kruse (who was already living at the address when I purchased it) that we would reside/share the property. I rarely saw Josephine Kruse as she worked evenings and I worked regular office hours, therefore she would already be at work when I arrived home from my boyfriends house around 3/3:30am. I would already be at work when Josephine Kruse would arrive home to sleep. I never changed my licence address as my car was kept at my parents house which was two doors away as there was more parking space there. The electoral role (sic) never crossed my mind or stood out that my address was different/unchanged as it was still Lincoln Ave. Josephine Kruse was paying her rent to my mother directly as I had a private loan with my mother and as I never saw Josephine I had no relationship with her and was happy for my mother to get paid directly by Josephine.
Ms Falvo also placed reliance on four other statutory declarations and a "To Whom It May Concern" written statement.
In a Statutory Declaration sworn on 5 August 2015, Mile Prica stated that " in approximately March 2010" on the request of Ms Falvo's father he attended the Collaroy property to repair a tap when he congratulated Ms Falvo "on her new home".
In a Statutory Declaration sworn on 4 August 2015 Milunce Jankovic, father of Ms Falvo's boyfriend at the relevant time and now her father-in-law, stated as follows: 1. Vanessa Falvo would visit my residence every day from on or about January 2009. 2. Vanessa Falvo would regularly visit my residence straight from her employment. 3. Every morning I leave my residence at 3:00am to go to my cleaning job. 4. Every morning that I left to go to work I would see Vanessa Falvo in my living room.
In a Statutory Declaration sworn on 5 August 2015, Angela Cirillo stated that she "got a call from Vanessa Falvo one evening in 2010" saying that "her parents had gone to a wedding and were not home" and that "she was suffering from a bad headache". She further stated that she "dropped off panadine fort which I have for myself" at the Collaroy property.
In a Statutory Declaration sworn on 4 August 2015, Barry Andrews stated that he moved to the Collaroy property on 9 October 2013 and further stated - It was offered through an old friend Josie Kruse that had been living at the house. I share the house with the owner. I understand that she had a room as she does now.
In a "To Whom It May Concern" written statement dated 3 August 2015, Diana Perri stated that she was able to confirm as follows: On March 20th Saturday night I went to pick up Vanessa Falvo from …. Collaroy. We were going out for Olivia's birthday. We had pre dinner drinks at Vanessa's house, to celebrate as she had recently moved in.
Besides Diana Perri who was willing to attend on the telephone to give evidence, the others did not attend the hearing or make themselves available for any cross-examination.

Chief Commissioner's Evidence

In addition to the material before the Tribunal produced by the Chief Commissioner pursuant to s 58 of the Administrative Decisions Review Act 2000 and "Summons" material, the Chief Commissioner relied on the evidence of Ms Josephine Kruse and Ms Simone Burgess. They provided the Tribunal with statutory declarations and also made themselves available for cross-examination.
The evidence of Ms Kruse as set out in her Statutory Declaration was usefully summarised by Mr Gerard in his written submissions as follows - i. she lived at the Property from October 1998 to about October 2013. During the period between October 1998 and October 2013, the Property was Ms Kruse's sole residence; ii. she, along with a Mr Taubman, signed an initial twelve (12) month lease for the Property in October 1998. In all the time Ms Kruse lived at the Property Ms Kruse did not sign another lease; iii. from the time Ms Kruse moved into the Property in October 1998, Ms Kruse used the room marked "Bed 3" on annexure "C" to Ms Kruse's affidavit iv. Ms Kruse installed a dog door on the door in "Bed 3" leading to the garden within a few months of moving into the Property in October 1998. Ms Kruse also built a 2 metre high fence with a padlocked gate to keep her dog in the yard. Ms Kruse's and Ms Burgess's dogs, both before and after 2009, regularly entered and exited the house on the Property through "Bed 3" (the bedroom that was Ms Kruse's until 2012 and bedroom Ms Falvo asserts she was using since 2009); v. Ms Kruse moved to "Bed 2" in about 2012. Thereafter, from 2012, "Bed 3" was used as a study/storage room; vi. Vanessa Falvo visited the property only twice. The second of those occasions, in 2013, was after Ms Kruse had moved her bedroom from "Bed 3" to "Bed 2"; vii. Over the course of the 15 years that Ms Kruse lived at the Property, Ms Kruse had between approximately 20 to 30 different housemates share the Property with her. Two of those housemates were Simone Burgess and Craig Ferry. viii. Simone Burgess lived at the Property with Ms Kruse from 2000 to 2005, briefly in 2005 and then again from 2007 to 2012; ix. Samuel Zannis, Simone Burgess and Ms Kruse lived at the Property together from 2009 until late 2011 when Samuel Zannis moved out. Whilst those three lived at the Property: Sam used Bed 1 as his bedroom; Simone used Bed 2 as her bedroom; and Ms Kruse continued to use Bed 3 as her bedroom; x. No other person lived in the house at the Property with Samuel Zannis, Simone Burgess and Ms Kruse from late 2009 until 2011. xi. Craig Ferry lived in the house at the Property with Ms Kruse from mid 2012 until some-time in late 2012. In late 2012 Craig commenced living in the garage on the Property; xii. Ms Kruse has been in the physical presence of Vanessa Falvo at the Property only a couple or few times in her life; xiii. Vanessa Falvo did not live with Ms Kruse at the Property as from 31 December 2009. Vanessa Falvo did not live at the Property whilst Ms Kruse was living there; xiv. Ms Kruse never signed any document with Carmel Falvo to the effect that Ms Kruse would share the Property with Vanessa Falvo. Ms Kruse never reached any agreement with Carmel Falvo, Vanessa Falvo or any other person to the effect that Falvo would live at the Property. xv. Vanessa Falvo did not use Bed 3, as and from 31 December 2009, as her bedroom. Bed 3 was Ms Kruse's room and they certainly did not share.
Ms Burgess also provided a Statutory Declaration and made herself available for cross-examination. Mr Gerard, counsel for the Chief Commissioner has also in his written submissions usefully summarised Ms Burgess's statement as follows: i. corroborates Ms Kruse's evidence in every critical aspect; ii. attests that she lived at the Property with Ms Kruse form 2000 to 2005, briefly in 2005 and then again from 2007 to 2012; iii. attests that Samuel Zannis, Ms Burgess and Ms Kruse lived at the Property together from 2009 until late 2011 when Samuel Zannis moved out. Whilst those three lived at the Property: Sam used Bed 1 as his bedroom; Simone used Bed 2 as her bedroom; and Ms Kruse continued to use Bed 3 as her bedroom. iv. attests that no other person lived in the Property with Samuel Zannis, Simone Burgess and Ms Kruse from late 2009 until 2011; v. attests that she has never met a person by the name of Vanessa Falvo; vi. says that no-one called Vanesa Falvo ever lived in the Property while Ms Burgess was living there; vii. denies that any person moved into the Property on or around 31 December 2009. On the afternoon and evening of 31 December 2009 Ms Burgess was present at the Property. Ms Burgess says it simply did not happen.

Submissions

Ms Falvo's case was that "the facts, matters and circumstances" establish that she occupied the Collaroy property for a continuous period of 6 months from 31 December 2009. In particular, reliance was placed on her own evidence, her mother's evidence including her statutory declarations, declarations made by Barry Andrews, Mile Prica, and Angela Cirillo and Diana Perri's "To Whom It May Concern" statement. She also placed reliance on "countless bills, bank statements and other mail that was sent to the address" in her name.
Mr Gerard put the Chief Commissioner's case both in writing and in viva voce submissions at the hearing.
Counsel first noted that under "s.28(3) of the FHOG Act, the applicant bears the onus of proving the applicant's case to the ordinary civil standards, that is, on the balance of probabilities: Ma v FCT 992 ATC at 4373 per Burchett J; B & L Linings Pty Ltd v Chief Commissioner of State Revenue (2008) 74 NSWLR 481 per Allsop P (Giles and Basten JJA agreeing)."
Next, Counsel pointed out to "the following difficulties in respect of the evidence and the Applicant's case" - 1. there is no probative evidence before the Tribunal, other than the Applicant's version of events; 2. the Applicant has not lead evidence from a demonstrably relevant witness, being the Applicant's boyfriend at the relevant time: as to relevance in the context of the issue being in dispute, see Jones v Dunkel (1959) 101 CLR 298; 3. key elements of the Applicant's case are uncorroborated in the evidence in chief of witnesses relied on by the Applicant, where those witnesses were capable of giving corroborative evidence and have not done so; 4. key elements of the Applicant's case are uncorroborated by objective documentary evidence asserted by the Applicant to have existed, in circumstances where a witness with no personal interest in the outcome of the proceedings wholly denies that document ever existed; 5. finally and most importantly, there is a body of powerful, corroborative and irresistible direct witness evidence given by two former tenants of the Property (two of which lived at the Property during the relevant period), none of whom have any personal interest in the outcome of the proceedings, which directly and wholly rebuts any suggestion that: a) the Applicant ever lived at the Property prior to 2013; b) (even more specifically) that the Applicant ever used "Bed 3" as her bedroom whilst "living" at the Property; and that c) the Applicant, through her mother, reached a "written agreement" with the leaseholder of the Property, Ms Kruse, the terms of which were that the Applicant could share the Property with Ms Kruse.
On the basis of the above submission, Mr Gerard contended "that the probative direct witness evidence demonstrates that the Applicant, at least not before the middle of 2013, did not live in or occupy the Property, as a residence, or at all".
In the alternative, it was submitted by Mr Gerard that even if Ms Falvo's version of events was to be accepted, she "did not meet the criteria of s.12 of the FHOG Act" which required her to "occupy" the property as her principal place of residence for a period of six months for the following reasons: 47. The evidence is Ms Kruse entered a formal lease of the Property in October 1998. The Applicant does not deny that. Ms Kruse continued to rent the Property until 2013. The Applicant does not deny that. Ms Kruse's rental bond for the Property was returned in October 2013 on the basis that her tenancy of the Property had concluded in or around that time in 2013. 48. The Applicant's case is that her mother (who incidentally neglects to mention this matter in her statutory declarations) and Ms Kruse had "written agreement" that Ms Kruse and Ms Falvo would "share"/ "reside/share" the Property. The Applicant does not suggest that Ms Kruse's lease of the Property ever terminated pursuant to this asserted "written agreement" of which the Applicant (who was the owner of the Property) is not asserted to be a party. 49. Even accepting the Applicant's hearsay version of events regarding the unproduced asserted "written agreement", the Tribunal could not be satisfied that any such agreement (whose terms are un-established and whose existence is wholly denied by the Respondent) amounted to anything more than a mere licence granted by Ms Kruse to the Applicant to use the Property. In that regard, even on the Applicant's version of events, the Applicant did not satisfy s.12 (1) of the FHOG Act. 50. "Occupation" refers to the relationship between a person and the land in question: see Chief Commissioner of State Revenue v Mesiti [2003] NSWADTAP 57 at para. [44] ("Mesiti"). Although not synonymous with legal possession, occupation requires possession and control of possession: see Commissioner of Land Tax v Christie [1973] 2 NSWLR 526 at 533 and 534 ("Christie"), per Bowen JA; see also R v St. Pancras Assessment Committee [1877] 2 Q.B.D. 581, at 588, per Lush J: see also Mesiti at para. [45]. 51. As outlined by Bowen JA in Christie at 533: "Occupation" is not synonymous with legal possession. It includes possession, but it also includes something more: Newcastle City Council v Royal Newcastle Hospital." (my emphasis) 52. As outlined in Christie, occupation includes possession. In circumstances where Ms Kruse continued to hold a lease of the Property, Ms Kruse maintained exclusive possession of the Property. In turn, the Applicant did not have legal possession of the Property for the duration of Ms Kruse's lease. Ms Kruse did. The Applicant therefore did not occupy the property. 53. On the Applicant's best version of events, she used the Property, in accordance with the asserted "written agreement". At best, even accepting the Applicant's version of events, the Applicant was a mere licensee of the Property. As outlined by the Appeal Panel in Chief Commissioner of State Revenue v Aldridge & Anor [2003] NSWADTAP 50 ("Aldridge") and above, at common law, a lease is a demise of real property that vests in the tenant the right to exclusive possession of the property: see Aldridge at para [17]. 54. With Ms Kruse holding a lease of the Property, the Applicant was not capable of, and did not, occupy the Property in the sense required (even accepting her version of events). It was Ms Kruse and not the Applicant who was in occupation, at all, of the Property at all times between October 1998 and October 2013 (the duration of the lease).
Mr Gerard also cited as being instructive the decision of Gzell J in Flaracos v Chief Commissioner of State Revenue [2003} NSWSC 68. In that case his Honour Gzell J held that an owner of a property did not lose control of the property even if there was a tenant, provided the owner maintained legal control over the property.

Findings and Reasons for Decision

In this matter, the Tribunal was required to determine the residence issue in the context of two very contradictory versions of the events that occurred in the relevant six months.
On one hand, there was the very adamant assertion by Ms Falvo that she had used the Collaroy property for six months from 31 December 2009. On the other hand, this assertion was made against very strong evidence of two independent witnesses who categorically stated that Ms Falvo did not use or occupy the Collaroy property in the relevant period.
Both Ms Kruse and Ms Burgess were made available for cross-examination and the Tribunal had the opportunity to assess their credibility as independent witnesses.
There was no challenge that Ms Kruse held a lease of the Collaroy property until 2013 and was allowed under the lease to sublet to tenants. There was evidence that Ms Kruse had been a good tenant and had a good relationship with Ms Falvo's mother.
I am satisfied that, in this matter, the evidence provided by Ms Kruse and Ms Burgess is to be preferred for a number of reasons.
Firstly, Ms Falvo did not challenge the evidence that they have provided as independent witnesses.
Secondly, their evidence was first hand knowledge of what occurred during the relevant period. I agree with the Chief Commissioner's submission that there is a body of powerful corroborative and irresistible direct evidence given by these two former tenants, which directly and wholly rebuts any suggestion that Ms Falvo ever lived at the Collaroy property prior to 2013 There was no real challenge to that part of their evidence.
Thirdly, Ms Falvo's own uncorroborated evidence had several "gaps". In particular, she was not able to establish with any independent evidence that she actually had used a room at the Collaroy property during the relevant period. On the evidence of both Ms Kruse and Ms Burgess, there was in fact no room available for Ms Falvo's use during the whole period of the lease held by Ms Kruse.
Her boyfriend, her current husband and a New South Wales solicitor, did not give any evidence to support Ms Falvo's assertion that she spent considerable time at her boyfriend's house and left at odd hours of each morning to sleep at the Collaroy property. His absence to give this very critical evidence must, in my opinion, be considered in the context of the well-established principle or rule in Jones v Dunkel. In my opinion, in these circumstances, the Tribunal is clearly entitled to draw an unfavourable inference.
Fourthly, the declarations and the "To Whom It May Concern" statement add very little to support Ms Falvo's case that she used the Collaroy property for a continuous period of six months during the relevant period. The absence of three of the makers of the declarations for cross-examination must also lead to an adverse inference as to the likely evidence they would have provided if they had attended the hearing: Jones v Dunkel.
Fifthly, Mr Jankovic's declaration, in some important aspects, clearly contradicted the assertions made by Ms Falvo. Mr Jankovic, her father-in-law, says in his declaration that he saw Ms Falvo every day from on or about January 2009 at his residence and was still there each day at 3am when he left for his cleaning job. Her own evidence was that she would leave her boyfriend's residence "around 12am - 3am. Mr Jankovic also stated that every morning when he went to work at 3am he "would see Vanessa Falvo in my living room". There is no mention by Mr Jankovic of Ms Falvo leaving her boyfriend's house as claimed by her. His evidence, combined with that of Ms Kruse and Ms Burgess, lead to the conclusion that Ms Falvo did not use the Collaroy property as her principal place of residence and appears to have instead used her boyfriend's house as her place of residence, where on her own evidence she cooked her evening meals and spent considerable time.
Ms Falvo had the burden to establish that she occupied the Collaroy property as her principal place of residence for a continuous period of six months after settlement.
In the absence of any independent evidence, the uncorroborated assertion made by Ms Falvo clearly falls short of discharging the onus that Ms Falvo had to discharge. On the evidence, the Tribunal is clearly entitled to reject her assertion of events. The better view, based on the independent evidence given by Ms Kruse and Ms Burgess and the documentary evidence made available by the Chief Commissioner was that, during the relevant period, Ms Falvo did not use the Collaroy property.
Even if the Tribunal accepts that Ms Falvo did sleep at the Collaroy property as claimed by her for 3 to 4 hours every day during the relevant period, Ms Falvo is also, in my opinion, confronted with major difficulties in satisfying the residence requirement.
There was no dispute that Ms Kruse held the lease to the Collaroy property during the relevant period. Ms Falvo claims that her mother had reached some agreement with Ms Kruse to allow Ms Falvo to use a room. If that had occurred, her use of the Collaroy property would not have been as a first home owner but as a mere licensee. As noted by the Appeal Panel in Aldridge at para [17], it is well established that - At common law, a lease is a demise of real property that vests in the tenant the right to exclusive possession of the property. A transaction under which a person takes merely the right to use premises, without exclusive possession is a licence and not a lease (Taylor v Caldwell (1863) 3 B&S 826). To ascertain whether a transaction is a lease or a licence, one must look at the substance as well as the form of the transaction (Teasedale v Walker [1956] 3 ALL ER 307).
In Flaracos, his Honour Gzell J held that an owner of a property, in certain circumstances, can have a tenant and yet continue to treat his residence as his principal place of residence provided the owner maintained legal control over the property. For purposes of the present matter, his Honour made the following rather relevant observation: On the findings I have made I am of the view that the plaintiff was in occupation of the Peakhurst premises. Notwithstanding the contemporaneous presence of a tenant, it was the plaintiff who maintained control over the premises. This was not a case in which the premises were handed over to a tenant who thereby obtained exclusive possession of them.
There was no dispute that Ms Kruse had "exclusive possession" of the Collaroy property during the relevant period. Even if Ms Falvo's assertion that she occupied a room at the Collaroy property during the relevant period is accepted, her occupation was without exclusive possession and not as an owner. Her occupation was no more than occupation under a licence granted by Ms Kruse pursuant to the alleged "written agreement". In those circumstances, she could not have occupied the Collaroy property as her principal place of residence as required by s 12 of the FHOG Act.
Ms Falvo is also confronted with another difficulty in satisfying the residence requirement. Mere occupation of a room for a few hours each day during the relevant period was not sufficient to establish that the Collaroy property was her principal place of residence during the relevant period. In order to satisfy the test, Ms Falvo had, besides the quantitative test of residence for a period of six months, the task to establish that her occupation had the quality required to establish that the occupation of the Collaroy property was as her principal place of residence.
The expression "principal place of residence" is not defined in the FHOG Act and thus must be given its ordinary meaning.
The question of whether the Collaroy property was, in fact, Ms Falvo's principal place of residence during the relevant period, is a question of fact and degree to be determined on an objective view of the evidence before the Tribunal: see Downie v Chief Commissioner of State Revenue [2003] NSWADT 233 at para. [26] and Cameron v Chief Commissioner of State Revenue [2009] NSWADT 64.
In Zakariya v Chief Commissioner of State Revenue [2003] NSWADT 26, the Tribunal in evaluating the relevant criteria of what constitutes a "principal place of residence" in the context of the FHOG Act, referred to Dickenson and Secretary, Department of Social Security [1989] AATA 190; (1989) 18 ALD 58 where the Tribunal in considering a similar phrase relied on some very helpful well settled principles - 17 In Dickenson, the Tribunal regarded "a substantial degree of occupation" as being persuasive (Herbert v. Byrne [1964] 1 All ER 882) and contrasted an occupation of a property by way of "occasional visiting" not constituting occupation of a home (Beck v. Scholz [1953] 1 All ER 814). A "home" is likely to be a "place where persons ordinarily eat, morning and night, and where they sleep, and in the case of adults have the characteristics of permanency" (Dickenson, at 61, citing Todd v. Nichol [1957] SASR 72).
Merely sleeping at a place is not sufficient to establish a principal place of residence, as was observed by the Tribunal in Re Ziino and Commissioner of State Revenue [2004] VCAT 1707 - … while sleeping by itself in a place can be an indication of a principal place of residence, it is not the sole matter to be taken into account. One needs to look at a whole indicia of matters … One needs to look as well at where the applicant; ate; his use of electricity and the furniture and fittings and other matters such as entertainment of friends in the house … Sleeping in a place does not make a residence. It has got to be the whole indicia of things that are done in a home …
In Chief Commissioner of State Revenue v Ferrington (GD) [2004] NSWADTAP 41, the Appeal Panel in evaluating the relevant criteria to determine what constitutes a "principal place of residence", noted that "to occupy as his or her principal place of residence a person's occupation must have a degree of permanence to it: a connection to a place of residence of transient, temporary, contingent or passing nature is not sufficient, nor occupation for any other reason".
In this matter, Ms Falvo, in her statutory declaration, declared that she only arrived at the Collaroy property to sleep in a room between the hours of "3/3.30am" and left sometime before 7.30am each day during the relevant period. That, by itself, was not sufficient to establish that the Collaroy property was her principal place of residence. That assertion was disputed; there was fairly strong evidence that Ms Falvo did not occupy a room at the Collaroy property during the relevant period. Ms Falvo, in my opinion, failed to discharge the onus that was placed on her under the FHOG Act even if her assertion was to be accepted as to the events that occurred during the relevant period.
In passing, I should make the observation that there was some doubt in my mind as to whether Ms Falvo acquired the Collaroy property in a commercial transaction as a first home buyer from her parents or on the evidence of her mother the Collaroy property was given to her in the "Italian tradition". Her mother also mentioned that the relevant loan that Ms Falvo had obtained from the bank was to acquire another commercial property as an investment and not the Collaroy property. As this matter was not in issue, it is not necessary for the Tribunal to further examine this issue.
The only matter that remains is the imposition of a penalty of 60% by the Chief Commissioner pursuant to s 45(3) of the FHOG Act. Where there is a failure to comply with the conditions of a grant, the grant can be recalled and the Chief Commissioner's is given power to impose a penalty not exceeding the amount required to be repaid.
The Chief Commissioner's submission was that the penalty of 60% was "appropriate" and "indeed conservative".
The various factors that can be taken into account include (see Philpott v Chief Commissioner of State Revenue (RD) [2008] NSWADTAP 18 and Knight and Anor. v Chief Commissioner of State Revenue [2008] NSWADT 83) - 1. The truthfulness of the original statements made by the applicant in his or her application for the grant. 2. The surrounding circumstances including the intention of the applicant in relation to the occupation and use of the property as his or her principal place of residence at the time when seeking the grant. 3. The reasons for failure to comply with the conditions of the grant. 4. Whether the applicant has occupied the property as his or her principal place of residence. 5. The candour of the applicant in his or her responses to compliance inquiries. 6. Whether the grant has been refunded.
Having regard to the facts in this matter against the factors suggested above, I agree with the Chief Commissioner that the 60% penalty was appropriate and, therefore, should not be disturbed.
In particular, I have had regard to the fact that Ms Falvo worked in the real estate business and would have been very familiar with the requirements that had to be satisfied to obtain a grant/boost under the FHOG Act. Ms Falvo was also very selective in her evidence and, in my opinion, she was not entirely a truthful witness. There was a very serious lacuna in her evidence. Ms Falvo did not produce any evidence form her boyfriend and now husband, a solicitor, who could have either confirmed or denied her assertion of the events.
The assessment under review is, accordingly, affirmed.
The Chief Commissioner wishes to be heard, at the end of the proceedings, in respect of an application for his costs of the proceedings pursuant to s 60(2) of the Civil and Administrative Tribunal Act 2013. I will fix that application for directions at 9.30am on 28 April 2016.

I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales. Registrar 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. Decision last updated: 14 March 2016

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Judgment (9 paragraphs)

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Cases Cited (5)