Secretary Department of Housing and Construction v Robert Keith Wildman & anor [1984] FCA 401

Federal Court of Australia|1984-11-23|Before: Everett JJ, Bowen CJ

THE COURT: The Secretary, Department of Housing and Construction, has appealed, on a question of law, from a decision of the Administrative Appeals Tribunal constituted by the President of the Tribunal determining that the date of

a contract for the purposes of s.15 of the Home Deposit

appeal is brought under 5.44 of the Administrative Appeals

Tribunal Act 1975, The Court is exercising original

Administrative Appeals Tribunal Act, must be constituted as a

Z dune 1982 and came into operation on that date; see 5.2.

The objects of the Act are set out in 5.3 which needs to be

"3. The objects of this Act are to encourage and assist persons to purchase or build their own homes and to encourage persons to save for the purpose of purchasing or building their own homes, and, in the construction and the administration of this Act, regard shall be had to those objects."

Under s.17 of the Act, the Secretary, Department of Housing and Construction is empowered, on behalf of the Commonwealth, to make a grant of moneys in accordance with the Act in respect of a dwelling to an applicant for the grant. An applicant is defined ins.4 of the Act by reference to 5.16. A reference to s.16 shows that a person who is a prescribed person in relation to a dwelling may in specified circumstances make an application for the grant. Under s.4 a prescribed person, in relation toa dwelling, means a person who 15 a prescribed person in relation to that dwelling by virtue of sub-section 15(1). In the present case the question of law is whether each of the Respondents is capable of being a prescribed person by virtue of sub-section 15(1). For this purpose it is necessary to refer in some

a person (in this section referred to as the "home acquirer") has, or 2 or

referred to as the "home acquirers") together have -

(a) entered into a contract for the purchase of a dwelling situated in Australia;

then, subject to sub-section (2) and section 5, the home acquirer or each of the home acquirers, as the case may be, is, and any person who, on the date of the contract, ... was the spouse of the home acquirer or of any of the home acquirers, as the case may be, is, for the purposes of this Act, a prescribed person in relation to the dwelling.

(2) Sub-section (1) does not apply to a person unless, on the relevant date, the person -

(a) a person is a prescribed person in relation to a dwelling; and

(b) subject to sub-section (5), a grant under a prescribed Act or under this Act has not been made to the prescribed person, either alone or jointly with another person,

the prescribed person is, for the purposes of section 16, a person to whom this sub-section applies.

(a) on the date on which a person entered into a contract... as mentioned in sub-section (1), the person was engaged to be married to another person; and

{(b) the Secretary is satisfied that the other person has consented to being treated as the spouse of the first-mentioned person for the purposes of this section,

a reference in this section to a person who, on the date of the contract ... was the spouse of the first-mentioned person shall be read as including a reference to that other person.

(5) For the purposes of paragraph (3)(b), a grant under a prescribed Act or under this Act shail be deemed not to have been made to a person, or to persons jointly, if, in pursuance of that Act or of this Act, as the case may be, the grant has been repaid to the Commonwealth or the Commonwealth has recovered the grant.

(6) For the purposes of this section, the date of a contract is such date as is determined by the Secretary, being a date -

(a) where paragraph (1) (a) applies - not earlier than the earliest date on which the home acquirer or home acquirers entered into contractual relations wath the owner of the dwelling in respect of the purchase of the dwelling; or

"prescribed Act" means the Home Savings Grant Act 1964 or the Home

(a) in relation to a person who is a prescribed person by reason of the entering into

by that person or by another person of a aontract of the kind mentioned in paragraph (1)(a) or (b) ~~ the date of the contract; and

Under sub-section 15(1), the Act has retrospective effect. In particular attention is drawn to sub-section 15(6). That sub-section uses the phrase "the date of a contract". The phrase "the date of the contract" is used in sub-section 15(1) in relation to the spouse of a home acquirer, in sub-section 15(4), and in paragraph 15(7)(a). In paragraph 15(1)(a) the equivalent words used are where a home acquirer has or home acquirers have "entered into a contract". Similar words are used in paragraph 15(4)(a) and in paragraph 15(7)(a). At the hearing of the appeal, the submissions by counsel were based, correctly in our opinion, on the assumption that the date of a contract determined hy the Secretary under sub-section 15(6) was the date upon which a home acquirer or home acguirers had entered into a contract under paragraph 15(1)(a). These reasons for judgment accept

The Applicants, who are husband and wife, made application under s.16. To support their application they relied upon an agreement in writing for the purchase of a dwelling in Australia. The agreement was dated 12 February 1982. The Secretary, pursuant to the power conferred by

sub-section 15(6) determined the date of the contract as 12

February 1982. On that determination neither of the Applicants was a prescribed person since the contract had been entered into before 18 March 1982. The Administrative Appeals Tribunal, on appeal, in reviewing the decision of the Secretary and exercising the power which had been conferred

upon the Secretary; see 5.43 of the Administrative Appeals

Tribunal Act; determined the date of the contract as 4 August 1982. On that determination each of the Applicants is a prescribed person since the contract had been entered into

The facts giving rise to the question of law raised by the appeal to this Court are somewhat unusual and need to be referred to in some detail. By an agreement in writing dated 12 February 1982, the Applicants, as purchasers, entered into an agreement for the purchase of the dwelling. The purchase price was $10,000 but the Respondents did not have sufficient money to pay a deposit on the house. On 12 February 1982 the dwelling was not in a sufficient state of repair to enable the Respondents to obtain finance. Under the agreement, no deposit was payable but the Respondents were entitled to take possession of the dwelling as tenants at the rental of $30 per week for a period of three months and during that period to effect repairs to the house at their own expense. The works and repairs to be effected were set out in clause 11 of the agreement. Clause 11 then continued:

absolute discretion approve following inspection the manner in which the works

and repairs outlined above have been effected then this sale shall within fourteen days of such written approval proceed to settlement and the Vendor shall provide to the Purchaser M.G.I.C.A.

The Respondents entered into possession of the dwelling and paid the rental of $30 per week but did not complete the specified works and repairs until late July or early August 1982. At that time the vendor inspected the works and repairs and the availability of finance was confirmed. On 4 August 1982 the Respondents signed documents of transfer and mortgage. Settlement took place on 2

The Respondents made the application for a grant under s.i6 of the Act. The Secretary determined that the Respondents had entered into the agreement for the purchase of the dwelling on 12 February 1982 being the date appearing on the agreement in writing. The Administrative Appeals Tribunal determined that the Applicants had entered into the contract on 4 August 1982 being the date upon which, the vendor having approved the manner in which the works and

repairs had been effected, the Respondents signed the

documents necessary to enable the agreement to proceed to settlement. The Tribunal remitted the application for

Counsel for the Secretary contended that under sub-section 15(6) of the Act the Secretary, when determining the date of a contract, had to apply normal legal principles to determine what in law was the date of the contract. Counsel for the Respondents stressed the stated objects of the Act and in particular the words "in the construction and the administration of this Act, regard shall be had to those objects" including the object to encourage and assist persons to purchase their own homes and contended that under sub-section 15(6) the Secretary had a discretion to consider all relevant facts and to determine the date of the contract having regard to all those facts and the objects of the Act; the only limitation being that the date so determined could not be earlier than the date on which the home acquirer or

home acquirers entered into contractual relations with the owner of the dwelling in respect of the purchase of the dwelling. The presence of this restriction, so it was contended, made it clear that the date appearing on any agreement for the purchase of a dwelling should not of itself

In our opinion the contention by counsel for the Respondents is correct. The method of determining by normal legal principles the date of a contract for the sale of land

is well known. It would be unusual for the Act to confer

upon the Secretary a power to apply that method in the exercise of an administrative function. The existence of the

limitation on the power contained in sub-section 15(6) suggests that factors other than the normal legal principles to be applied in determining the date of a contract are to be considered and taken into account by the Secretary. The Act is designed to give benefits to persons specified in the objects of the Act and in the subsequent provisions of the Act giving effect to those objects. Regard is to be had to those objects in the construction and the administration of the Act. In having regard to those objects the Secretary must take them into account and give weight to them as a fundamental element in Making his determination under

sub-section 15(6); see R. v. Hunt; Ex parte Sean Investments

Pty. Ltd. (1979) 25 A.L.R. 497 per Mason J. at p.504 and

Murphy Jd. at p.508, Municipal Officers' Association of

Australia v. Lancaster (1981) 37 A.L.R. 559 per Evatt and

Northrop JJ. at pp.578-9 and Wright v. McLeod (1983) 51

A consideration of sub-section 15(6), having regard to the objects of the Act, suggests that the discretion conferred on the Secretary by that sub-section is a discretion not limited to the application of normal legal principles to determine what in law is the date of a contract. On appeal, the Administrative Appeals Tribunal exercised the discretion conferred by that sub-section in

On this construction of sub-section 15(6) it is necessary to consider whether the Administrative Appeals Tribunal took into account any matter which it should not have taken into account or failed to take ito account any matter that it should have taken into account when exercising

The Tribunal was fully conscious of the importance of the date appearing upon the written agreement for the purchase of the dwelling. The Tribunal rejected a contention made on behalf of the Respondents that the agreement dated 12 February 1982 had come to an end at the expiration of the three month period when the Respondents had failed to carry out the works and repairs by that time and that thereafter a separate oral agreement was entered into when the works and repairs were completed to the satisfaction of the vendor. The Tribunal held that the agreement in writing dated 12 February 1982 continued in operation and that the Respondents remained in possession of the dwelling under the terms of

In exercising the power conferred by sub-section 15(6) and in determining the date of the contract as 4 August 1982 the Tribunal had "regard to the unusual nature of the arrangement between the parties". Correctly, in our opinion, the Tribunal rejected the proposition that it was required to apply normal legal principles to determine what in law was the date of the contract. Accordingly, the Tribunal said:

"The exercise of the discretion conferred by s.15(6) is not governed by principles

of law whach determine whether or not a provision such as clause 11 of the contract was a condition precedent or a - condition subsequent to the contract. Indeed, I assume that clause 11 was not a condition precedent to the contract itself."

The Tribunal considered that the carrying out of the works and repairs by the Respondents was a step that had to be completed before the sale could proceed. There was no deposit paid or to be paid by the Respondents. The cost of the works and repairs was not to be deducted from the

purchase price of $10,000, the whole amount of which was to

be advanced to the Respondents by way of loan. The Tribunal in its reasons then continued:

"The contract provided that the applicants should take possession of the property as tenants and should make repairs, it being understood though not stated in the contract that such repairs were necessary for the obtaining of the finance. The expenditure of labour and Materials on the property in the course of making the repairs was not part of the purchase price. The purchase price was $10,000 and that price was not reduced by the value of the labour and materials which the applicants put into the repairs. 4 August 1982, the date when the repairs had heen effected and finance was available, was the date when the sale of the house and land for $10,000 could go forward. The occupation of the land by the applicants as tenants and the repair of the house were precedent to that."

The Tribunal referred to the provisions of 5.3 of the Act and then continued:

"Plainly, the applicants were persons of little means, who desired to purchase their own home and sought to achieve that end by arranging to repair a dilapidated house at Taranna on the agreement that, once they had done so, they would he entitled to purchase it for $10,000."

The Tribunal then made reference to provisions of the Act relating to the encouragement of persons to save for the purpose of purchasing their own homes and concluded:

purchase of the property for $10,000 could proceed and 4 August 1982 was also

It ais not for this Court to substitute its discretion for that of the Tribunal. A careful consideration of the reasons for decision of the Tribunal shows that it has made no error in the exercise of the discretion conferred upon it by sub-section 15(6) of the Act and the provisions of the Administrative Appeals Tribunal Act. The Tribunal has not taken into account anything which it should not have

taken into account nor has it failed to take into account

Counsel for the Secretary made further submissions in support of the appeal based upon provisions contained in other Acts and in particular the Home Savings Grant Act 1976 and the First Home Owners Act 1983. The Court sees nothing in those Acts which supports or detracts from the opinions already expressed concerning the nature of the discretion

conferred on the Secretary by sub-section 15(6) of the Act.

the Administrative Appeals Tribunal affirmed. The Applicant

I cortrty that this and the TWELVE (r2.) proceding pages are a true copy of the Peasens for Judgment heicin of the COURT,

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Judgment (71 paragraphs)