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[2014] NSWCATAD 100
NCAT Administrative and Equal Opportunity
2014-06-19
Original judgment source is linked above.
Background 1The applicant Mr Spiros Theophilas on 20 January 2014 applied to this tribunal for review of a land tax assessment notice issued on 23 September 2013 (exhibit R1, tab 2) by the Chief Commissioner of State Revenue pursuant to the Land Tax Management Act 1956 (LTM Act) and the Taxation Administration Act 1996 (TAA Act) imposing land tax as at the taxing date, midnight on 31 December 2012. The assessment was issued on the basis that the applicant was entitled to the principal place of residence (PPL) land tax exemption contained in schedule 1A of the LTM Act in respect of his principal place of residence located at 6 Rodgers Avenue, Panania, New South Wales, in the 2013 land tax year. 2The applicant lodged an objection to the assessment, arguing that residential land situated at 82 St Marks Road, Randwick, was his principal place of residence for the purposes of the 2013 tax year and thus attracted the PPR exemption for that year. By letter dated 2 December 2013 (exhibit R1, pp 26 - 27) the Chief Commissioner disallowed that objection. 3Mr Theophilas now seeks review of the basis on which the Chief Commissioner had issued the assessment, arguing that the Randwick property was his principal place of residence during the 2013 land tax year and that it should therefore attract the benefit of the PPR exemption. The only taxing date in issue in this case is thus 31 December 2012. 4The applicant acquired the Randwick property on 26 November 1992. After settlement of the conveyance he lived there from early 1993 until September 2012. He has never obtained any income from the property. From January 1986 to December 1999 he owned and operated a BP service station and convenience store in Old South Head Road, Rose Bay. During the time he owned the service station, his niece, Katherine Grigorakis, was employed full-time at the service station and lived with the applicant at Randwick, and before that in a two-bedroom apartment in Vaucluse, where the applicant lived before moving to Randwick. 5On 18 July 2011 the applicant entered into a contract with Cosmopolitan Homes Pty Ltd for the demolition of the existing Randwick residence and the construction of a new residence there. Immediately before the demolition in September 2011 he moved out of the Randwick property and went to live at the Panania property, which he owned by way of inheritance from a cousin, while the new house was under construction. 6After the demolition of the previous structure in September and October 2011, some site works were carried out, including removal of a swimming pool, the delivery of landfill and the construction of a retaining wall with a view to raising the level of the land. But on 4 November 2011, Cosmopolitan went into liquidation and construction of the new residence ceased (the applicant had originally stated that Cosmopolitan went into liquidation in November 2012, but that apparent typographical error was later corrected in his affidavit, exhibit A2). As he had obtained home warranty insurance for the project, he lodged a builder's warranty claim on the policy. The claim was accepted but it was not until May 2013 that the applicant received payment of the sum due, $197,118.85. Until receiving payment, the applicant was unable to resume construction, but following payment he obtained quotes from other builders, eventually settling on Prohora Building Group Pty Ltd. It was then necessary for the new builder to obtain a current construction certificate, as well as detailed construction and engineering drawings. The applicant expects that the rebuilding project will recommence in the near future. 7On 22 August 2013, the Chief Commissioner sent a letter to the applicant informing him of his potential land tax liabilities (exhibit R1, p 1). In that letter the respondent identified land owned by the applicant as at midnight on 31 December 2012 as being Randwick, Panania and a third property at 191 Hawkshill Road, Canyonleigh. The letter also enclosed a land tax questionnaire and a guide containing information about land tax, a list of some of the exemptions that could apply and some examples of how land tax would operate in certain situations. 8The Chief Commissioner issued the assessment on 23 September 2013, which created a land tax debt in the sum of $11,950.65. The Chief Commissioner wrote to the applicant confirming approval of his request for payment of the debt by instalments (exhibit R1, p 9). The schedule to that letter provided for the final instalment to be paid by 7 April 2014. The debt was not paid and remains outstanding.
9The issue in this case is whether, on 31 December 2012, Randwick or Panania was the applicant's principal place of residence and, specifically, whether the applicant was entitled to have his actual use and occupation of Panania taken into account for the purposes of the PPR exemption. That devolves into a number of sub-issues:
Applicable legislation 10Under ss 7, 8 and 9 of the LTM Act, land tax is chargeable on the taxable value of the Randwick property for the 2013 land tax year on the basis of the ownership of that land as at midnight on 31 December 2012. A reasonable period, such as six months, on each side of 31 December may also be considered: Leda Manorstead Pty Ltd v Chief Commissioner of State Revenue [2010] NSWSC 867, [4]. As it is not disputed that the land was at that time owned by the applicant, he is prima facie liable for land tax in respect of that land tax year on the basis of the taxable value of the land, except to the extent that it can be shown that the land was exempt from land tax. 11The present application relies on the PPR exemption. As at 31 December 2012, s 3 of the LTM Act provided that "principal place of residence of a person means the one place of residence that is, among the one or more places of residence of the person within and outside Australia, the principal place of residence of the person". Section 10 then proceeds to exempt that place of residence from taxation. 12As at 31 December 2010, clause 6 of schedule 1A to the LTM Act provided as follows: 6 Concession for unoccupied land intended to be owner's principal place of residence (1) An owner of unoccupied land is entitled to claim the land as his or her principal place of residence, if the owner intends to use and occupy the land solely as his or her principal place of residence. In such a case, the owner is taken, for the purpose of the principal place of residence exemption, to use and occupy the unoccupied land as his or her principal place of residence. Note. It is an offence under section 55 of the Taxation Administration Act 1996 to make a statement to a tax officer, or give information to a tax officer, orally or in writing, knowing that it is false or misleading in a material particular. (2) This clause does not apply unless: (a) the land is unoccupied because the owner intends to carry out, or is carrying out, building or other works necessary to facilitate his or her intended use and occupation of the land as a principal place of residence, and (b) if those building or other works have physically commenced on the land, no income has been derived from the use and occupation of the land since that commencement, and (c) the intended use and occupation of the land is not unlawful. (3) This clause applies in respect of the assessment of a person's ownership of land only in the period of: (a) 4 tax years immediately following the year in which the person became owner of the land, or (b) if the land is used and occupied for residential purposes by a person other than the owner at any time after the person became owner, 4 tax years immediately following the tax year in which the building or other works necessary to facilitate the owner's intended use and occupation of the land are physically commenced on the land. (4) (Repealed) (5) If the principal place of residence exemption applies by operation of this clause to land not actually used and occupied by a person as his or her principal place of residence on a taxing date, that exemption is revoked if the person fails to actually use and occupy the land as his or her principal place of residence by the end of the period in which this clause applies in respect of the assessment of the person's ownership of the land and to continue to so use and occupy the land for at least 6 months. (6) The effect of the revocation is that the principal place of residence exemption is taken not to have applied to the land in respect of any tax year to which, but for the revocation, it would have applied. Land tax liability is to be assessed or reassessed accordingly. (7) This clause does not apply in respect of land owned by a person if: (a) the person or any member of the person's family (within the meaning of clause 12) is entitled to have his or her actual use and occupation of other land taken into account under section 9C or 9D or under this Schedule, or (b) the person owns land outside New South Wales that is the principal place of residence of the person or a member of the person's family (within the meaning of clause 12), or (c) the land, or the land if combined with any adjoining land of which the person is an owner, is capable of having more than 2 residences or residential units lawfully built on it. (8) For the purposes of this clause: unoccupied land means land that is not being used or occupied for any purpose. 13Clause 12 of schedule 1A clarifies that only one principal place of residence may be treated as the PPR of all members of the same family. 14As in the determination of all such applications, the tribunal is to apply s 100(3) of the Taxation Administration Act 1996 (TA Act), which provides that "The applicant has the onus of proving the applicant's case in an application for review". The tribunal has jurisdiction under s 96(1)(a) of the TA Act to review the Chief Commissioner's decision to reject the applicant's claim for the unoccupied land exemption for the Randwick property for the 2013 tax year.
15The respondent called no oral evidence but tendered the s 58 documents (exhibit R1). 16The applicant gave oral evidence. He adopted his affidavit of 29 April 2014 (exhibit A2) in which he stated that he had purchased the Randwick property at auction on 26 November 1992 and had lived there from early 1993 until September 2012. He had never obtained any income from it. As was stated above, from 1986 to 1999 he owned and operated a BP service station and convenience store in Old South head Road, Rose Bay. His niece was employed there full-time and lived with him at the Randwick property. 17On 18 July 2011 he contracted with Cosmopolitan Homes Pty Ltd for the demolition and reconstruction at the Randwick property. Immediately before demolition in September 2011 he moved out and went to live on a temporary basis at the Panania property while the new residence was being constructed. 18The Panania property was owned by his cousin who had intended leaving it to the applicant's parents. In view of their advanced age, however, his parents suggested that he leave the property to the applicant. His cousin died on 16 August 2007 and the property was left to him as head of the family. 19When only the site works described above had been completed, Cosmopolitan went into liquidation on 4 November 2011, thereby delaying the construction of the new residence. His home warranty insurance claim was paid on 21 May 2013 in the amount of 197,118.85, whereupon the applicant obtained builder quotes for the construction. Adding to the delays caused by this process was the fact that his father suffered a stroke on 10 February 2014 and was admitted to Liverpool Hospital until being moved to Hammondville nursing home in mid-December2013 pending the rebuilding at Randwick. 20 The applicant had thus been focused on attending to his father's needs as well as those of his mother, aged 87. 21He had never intended that the move to Panania would be other than temporary. He had intended, and still intended, to resume living at Randwick when construction was complete. He expected rebuilding to commence in May-June 2014. Panania had never been his principal place of residence and he had moved there only because of the rebuilding at St Marks Road, Randwick. 22In mid-December 2013 he moved from Randwick to 8 Kembla Street, Arncliffe. That property is not owned by him. The Panania house has been unoccupied since December 2013 and is used for storage. 23In his oral evidence in chief Mr Theophilas explained that he had planned that his aged parents would move to Randwick so that he could take care of them. The house was old and needed work, including the installation of wheelchair access, and overall it was cheaper to demolish it and rebuild. His parents were now living at Lurnea, a Liverpool suburb. His father, aged 95, was in a nursing home and his mother was in hospital. 24On receiving the land tax assessment in issue in October or November 2013, he had telephoned the Office of State Revenue and had explained to one of the officers that Randwick had been demolished and he had moved to Panania. She had advised him that in order to avoid land tax liability for the next year, he should move into a house that was not owned by him. She may have used the term "principal place of residence", but he could not recall her doing so. 25In cross-examination Mr Theophilas said that the Randwick house was liveable, but he decided to demolish it, which would increase the value of the property. He moved out all his personal effects, discarding a good deal of them, and had moved to Panania, a two-bedroom house that he now owned, in September 2011 and lived there rent-free. His niece had already moved out of Randwick in 2000. He had decided to rebuild long before inheriting the Panania property. 26 After payment of the insurance claim, he had expected that construction would resume in May 2014, but to date it had not done so. The new builder, Prohora, has been delayed on other projects by wet weather and cannot start work until early September. The applicant has received offers to buy the property but has rejected them because he intends that it will be his principal place of residence. 27The applicant acknowledged that he had changed his address with Roads and Maritime Services (formerly RTA). In July 2012 his electoral roll address had also been changed, but that was done automatically and he had not applied to change it.
Applicant's submissions 28On behalf of the applicant Mr McMillan submitted orally and in writing that the Randwick property satisfied clause 6(1) of schedule 1A, as it is residential land not used for any other purpose and was previously used by the applicant as his principal place of residence. While currently unoccupied, it is land that the applicant intends to continue to use and occupy as his principal place of residence once rebuilding is completed. 29The respondent's position that clause 6 does not apply by reason of clause 6(7) because the applicant is entitled to have his actual use and occupation of the Panania house taken into account under schedule 1A, clause 2, was incorrect. Clause 6, the applicant contended, was clearly intended to have a beneficial operation, as was the inclusion of the words "this Schedule" in clause 6(7). Were it not for the inclusion of those words, it might be doubtful whether a landowner was entitled to have other land considered as his PPR. The unoccupied land would, where the requirements of clause 6 were met, continue to be deemed to be the owner's PPR. 30The applicant was not "entitled to have" his actual use and occupation of Panania taken into account under the schedule as his move to that property was temporary. At no time did he use and occupy, or intend to use and occupy, Rodgers Avenue, Panania, as his principal place of residence. 31In his written submissions in reply, Mr McMillan submitted inter alia that the printed notes of his telephone conversation of 26 September 2013 with Kerrie Tasich, in which he was recorded as advising that Panania had been his PPR for the last 18 months, could not amount to an admission and there was no such admission. Any agreement concerning payment of outstanding land tax and compliance with any such agreement was irrelevant to the issues in this proceeding. 32The fact that the applicant had changed his residential address to Panania was not determinative, nor were the Telstra bill dated 7 September 2013 (exhibit R1, p 40), which was addressed to him at Panania, or the envelope re-addressed to him there (exhibit R1, p 46).. The reference to the number reservation in the Telstra bill, however, was to be noted. 33Gauci v FCT (1975) 135 CLR 81 and McCormack v FCT (1979) 143 CLR 284 showed that the manner in which the taxpayer discharges the burden of proof varies with the circumstances and that the evidence of a taxpayer should not be regarded as prima facie unacceptable and should be considered on its merits in the circumstances of the case. Further, while the onus is on the taxpayer, the degree of satisfaction for which the civil standard of proof calls may vary according to the gravity of the fact to be proved: Nixon v FCT (1979) 79 ATC 4377, 4381. The applicant had discharged the onus of proof. 34The move from Randwick was temporary and the applicant's return had been delayed by the liquidation of Cosmopolitan. The evidence established that his return had been delayed by matters beyond his control. There was no reason why the applicant's stated intention should not be accepted. 35Whether or not the applicant was entitled to an exemption in respect of Panania was not to the point. The question was whether the applicant was entitled to an exemption from land tax in respect of Randwick, in particular by virtue of cl 6 of schedule 1A. The fact that the objection incorrectly stated that he moved out of Randwick in September 2012 provided no reason why "the applicant's assertions should be treated with extreme caution". September 2012 was a simple typographical error. The correct date of September 2011 had been given in his affidavit. 36In his oral submissions the applicant reiterated the arguments outlined above and pointed out that cl 6(7) speaks of entitlement and does not disqualify the taxpayer simply on the ground of occupying other land. The provision itself is meant to be beneficial, because were it not for the inclusion of the words "this Schedule" in cl 6(7), it might be doubtful whether a landowner was entitled to have other land considered as his principal place of residence. The unoccupied land would, where the requirements of cl 6 were met, continue to be deemed to be the owner's PPR. 37Kidston Goldmines Ltd v Commissioner of Taxation (1991) 30 FCR 77, 79 illustrated the beneficial construction of a tax exemption provision relating to goldmining. In Penrith Rugby League Club Ltd v Commissioner of Land Tax [1983] 2 NSWLR 616, 622, Hunt J declined to apply a narrow construction to a land tax exemption provision. The present case should therefore also be treated beneficially and not narrowly. 38The 26 September 2013 conversation with Ms Tasich was wrongly recorded and the applicant denied it. Some words were omitted from the note, as no mention is made in the note of the fact that Cosmopolitan became insolvent after "only a very short time" of building. Too much was being made of the note and OSR was trying to place too much weight on a weak straw. 39There was no ground for treating the applicant's evidence with caution. He had corrected the erroneous dates in the objection letter and had himself forwarded to the respondent the redirected envelope and the Telstra bill, which reserved his telephone number for his return to Randwick. As he still does not know when he will be able to move back to Randwick, he had his mail redirected, but that is what anyone would do and does not mean that Panania was his PPR. 40In his oral submissions in reply the applicant argued that the respondent was attempting to limit the scope of the exemption because the applicant owned another property. The intention of the legislature, however, was to extend the operation of the exemption if the taxpayer was rebuilding. The applicant conceded that the circumstances beyond his control that had been referred to do not go to the exercise of discretion, but to tend to show why there was no change in the applicant's PPR. It was not disputed that Panania was used by the applicant, but it did not become his PPR because he intended to be elsewhere, being prevented from doing so only by circumstances beyond his control, especially the delay in paying the insurance claim.
41The applicant acknowledges that the onus lies upon him to prove his case on the balance (preponderance) of probabilities by reason of s 100(3) of the TA Act: B & L Linings Pty Ltd v Chief Commissioner of State Revenue [2008] NSWCA 187, [87], [104]; (2008) 74 NSWLR 481 (the relevant passages are not reproduced in the NSWLR report). As Brennan J stated in FCT v Dalco (1990) 168 CLR 614 at 624, unless the applicant shows by evidence that the assessment is incorrect, it will prevail. Further, the Chief Commissioner "is entitled to rely upon any deficiency in proof of the excessiveness of the amount assessed to uphold the assessment" (ibid.). 42An applicant "must prove all matters necessary to enable a tribunal to answer the statutory question in its favour", and "must establish all the facts on which it relies to claim the exemption": Cornish Investments Pty Ltd v Chief Commissioner of State Revenue [2013] NSWADTAP 25, [36] - [37]. 43At the same time, as Gibbs J said in McCormack v FCT (1979) 143 CLR 284, 302 the taxpayer's evidence is not to be regarded as prima facie unacceptable and "must of course be considered on its merits, in the circumstances of the case, without any preconception, favourable or unfavourable". 44Many of the material facts are not disputed. It is agreed that the applicant owned both the Randwick and the Panania properties on the relevant tax date, 31 December 2012. The applicant purchased Randwick in 1992 and acquired Panania by inheritance in 2007. He moved out of Randwick in September 2011 to permit demolition and reconstruction on the site. But work ceased in November 2011 when the contractor went into liquidation, after completing only the demolition and some site works. Construction has still not resumed. From September 2011 to mid-December 2013, the applicant occupied his property at Panania, and since mid-December 2013 has been living at Arncliffe in a property he does not own. Both Randwick and Panania are residential land. Randwick has been unoccupied since September 2011 and the residence at Panania is currently only used for storage. 45The applicant's case for the proposition that Randwick rather than Panania was his PPR as at 31 December 2012 for the purposes of the 2013 tax year rests on clause 6 of schedule 1A. By reason of clause 12, only one place of residence may be treated as his PPR. In order to satisfy clause 6, the applicant must establish by evidence that he intended to use and occupy the land solely as his PPR. 46The applicant gave evidence that he acquired Randwick with a view to making it into a residence where his aged parents could live close to him so that he could take care of them. He decided to demolish and rebuild with a new arrangement having wheelchair access. The redevelopment would also incidentally increase the value of the property. It was his intention to live there as his principal place of residence. He entered into a construction contract and moved out to Panania, but work ceased for the reasons given above and could not resume until the insurance claim was paid and new arrangements were made for construction. 47That account of his intention is plausible and uncontradicted by other evidence or challenged in cross-examination. I therefore find that the applicant has discharged the burden of proving the intention required by clause 6(1). 48The applicant must then bring himself within clause 6(2). In Aronstan v Chief Commissioner of State Revenue [2008] NSWADT 8, Verick JM stressed that all three of the requirements in cl 6(2) must be satisfied (at [43] - [44]) in order for an owner to qualify for the concession. First, the owner must show that he or she intends to carry out, or is carrying out, building or other works necessary to facilitate his or her use and occupation of the vacant land as his or her PPR. I find that the evidence, including the admitted facts and the applicant's unchallenged oral testimony concerning demolition, site work and the preparation for resumed construction, establish that the applicant comes within cl 6(2)(a). 49The second requirement is that, work having physically commenced, no income has been derived from the use and occupation of the land since that commencement. The applicant gave evidence to that effect and there is no evidence to the contrary, nor any other reason to reject his testimony on the point. The applicant thus meets the requirements of cl 6(2)(b). 50The third requirement is that the intended use and occupation of the land is not unlawful. As the evidence provides no reason to think that the intended use is unlawful, cl 6(2)(c) is also satisfied. 51Next, the applicants must satisfy cl 6(3), relevantly subclause (b). It is not disputed that the relevant taxing date fell less than four years after work commenced in 2011 and that the applicant's niece occupied the land for residential purposes for about seven years after the applicant became its owner. The requirements of cl 6(3)(b) are thus also met. 52The concession in cl 8 for absences from a former PPR applies only if the other land used and occupied by the taxpayer as his or her PPR is not owned by the taxpayer: cl 8(1)(b). As the applicant is the owner of the Panania property, that concession is irrelevant in this case. 53The crucial provision is cl 6(7), which excludes the unoccupied land concession from application if the owner "is entitled to have his or her actual use and occupation of other land taken into account under ... this Schedule". As Verick JM explained in Aronstan, the provision "simply denies the concession...if the person seeking the concession owns another residence within or outside New South Wales, which is on the relevant taxing date being used and occupied as the principal place of residence of the person. The subclause also prevents an owner of land, if the land or in combination of any adjoining land is capable of being developed, to have either two residences or residential units" (at [49]). 54The applicant's position is that he never intended Panania to be his PPR. The definition of "principal place of residence" in s 3(1) is, however, an objective one. That phrase occurs in a number of revenue and public finance contexts in Australia and is consistently so construed. In Deane v Commissioner of Stamp Duties (Qld) [1996] 2 Qd R 557, Fryberg J, when considering the meaning of "principal place of residence" in a stamp duty context held that the issue should be determined on an objective basis and concluded that "intention could be taken into account as a factor in the assessment. It seems to me that the intention is relevant, but not dominant..." (at [35]). Again, in Zakariya v Chief Commissioner of State Revenue [2003] NSWADT 26 the tribunal when interpreting the first home buyer legislation held that the subjective intention of a person did not bring an applicant within the eligibility criteria if the person did not in fact reside on the property as his or her PPR. 55Aronstan adopted that formulation for cl 6(7) purposes, adding that, "It is necessary that the original subjective intention of a person does in fact come to fruition for the original subjective intention to be accepted. The original intention, in any case, does not play a dominant role in the final determination of a person's principal place of residence" (at [39]). On facts comparable with those of this case, the applicants' claim for a cl 6 exemption failed because cl 6(7) applied to treat the applicants' "temporary" residence as their PPR. 56A search of the Roads and Maritime Services database conducted on 22 November 2013 (exhibit R1, pp 41 - 42) showed that the applicant's residential address was changed to the Panania property from 15 February 2012 and remained there at least until the date of the search. The taxing date falls between 15 February 2012 and 22 November 2013. 57A search of the Electoral Roll Commission database on 22 November 2013 (exhibit R1, p 43) records the applicant residing at the Randwick address from 22 April 1993 to 8 July 2012. On 8 July 2012, his registered address was changed to the Panania property and remained there at least until the date of the search, 22 November 2013. Again, the taxing date falls between 8 July 2012 and 22 November 2013. In the ordinary course of things, his move to use and occupation of the Panania premises is likely to have occurred some time before 8 July 2012 as, indeed, his own evidence affirmed. 58The Telstra telephone bill issued on 7 September 2013 for the period 4 June 2013 to 3 September 2013 (exhibit R1, p 40) is addressed to the applicant at the Panania property address. The envelope bearing a redirection service sticker from Randwick to Panania shows that the applicant had paid for redirection services until 24 April 2014. All the above evidence points to Panania being used and occupied by the applicant as his PPR at the taxing date. 59An important piece of documentary evidence is the print notes of a telephone conversation between the applicant and an OSR officer on 26 September 2013. The note records that the applicant - "Called re NOA 2013, advs ppty at Panania has been their PPR for past 18 mths, he is looking after elderly & sick parents. He did a knockdown-rebuild for Randwick, entered into a contract with building company Cosmopolitan, following month building co went broke, Randwick ppty is still vacant land, only just started employment 3 day/week after being unemployed after injury, had to move to Panania for these reasons" (exhibit R1, p 33). 60The note then continues with a summary of some advice which the officer, no doubt wishing to be helpful, gave to the applicant. It also notes that the officer set up a six-month interest-free instalment plan for the applicant, advising him that interest would be remitted as long as all instalments were paid on time. The plan, an objection fact sheet and an application form were emailed to him, with confirmation to be sent by postal mail. 61On behalf of the applicant Mr McMillan submitted that the respondent was placing too much weight on such a "weak straw" which had little probative value. He argued that the applicant denied making any such admission and pointed out that no other evidence from the officer had been forthcoming. The note was incomplete as some words from the conversation were omitted, as the note failed to mention that Cosmopolitan went into liquidation after "only a very short time" of building. 62In oral evidence, however, Mr Theophilas said only that he could not recall whether the phrase "principal place of residence" was used in the course of the conversation. The note is admissible and relevant in these proceedings whether or not the maker is called to give oral evidence or swears an affidavit. The words that the applicant says were omitted are inconsequential and in any case their gist is implied by the passage "following month co went broke". Further, it does not appear that the applicant made any reference to any plans for resuming construction at Randwick. Finally, the applicant's apparent acceptance of an instalment plan for paying the outstanding assessment debt suggests that he had no immediate objection to the proposition that he was liable to land tax in respect of Randwick. As regards the contents of the conversation generally, Ms Tasich's contemporaneous written note is more likely to constitute a reliable record of the exchange than the applicant's unaided recollection. For that reason, and also for the reasons given below, her version of the conversation is to be preferred. 63 Whether or not the applicant, or for that matter the officer, actually used the specific term "principal place of residence" in the course of the conversation, that document strongly points to Panania, where he had actually been living since September 2011, being the applicant's PPR at the relevant time. It should also be noted that construction at Randwick has still not resumed, over a year after the applicant received payment in full under his insurance policy. 64In support of his contention that Randwick remained his PPR for the 2013 land tax year, the applicant relied on his own evidence, which he said was corroborated by the reservation of his Randwick telephone number on the Telstra bill. In her detailed written submissions on behalf of the respondent, Ms Sethi pointed out that in his objection letter of 17 November 2013 (exhibit R1, pp 18-20), the applicant asserted that he moved out of Randwick to allow for demolition in September 2012, whereas the builder went into liquidation in November 2011. In light of that evidence, the applicant's assertions "should be treated with extreme caution". Mr McMillan countered that the incorrect date was obviously a typographical error that had been corrected in the applicant's affidavit of 29 April 2014. 65It is notable, however, that in the objection letter the incorrect 2012 date is given five times in three different contexts, even though the correct 2011 date is given for the contract with Cosmopolitan. Further, the error would have worked in the applicant's favour, tending to strengthen his argument that his move to Panania was purely temporary. Moreover, in the applicant's telephone call of 26 September 2013 to OSR, the applicant stated that he had been living at Panania (perhaps as his permanent place of residence) for 18 months, which would place the date of the move out of Randwick in approximately March 2012. While the possibility of typographical errors remains, it does rather appear that the applicant can be a little careless in his assertions and that some degree of caution in accepting them is warranted. 66The applicant submitted that the respondent was relying on an excessively narrow interpretation of cl 6(7). Clause 6 (and perhaps cl 6(7) itself) was a beneficial provision and should receive a liberal interpretation as the courts had done in Kidston Mines and Penrith Rugby League Club. 67The former dealt with and income tax concession designed to provide incentives for goldmining, while the latter was intended to relieve clubs and other community groups from the burden of land tax on land occupied by them. Clause 6 can be viewed as seeking to encourage housebuilding, and for that reason as meriting beneficent interpretation, but cl 6(7) is plainly intended to limit the scope of the unoccupied land exemption in the manner explained by Verick JM in Aronstan. Isolating the words "this Schedule" in cl 6(7) from their context and purpose, as Mr McMillan's ingenious argument sought to do, provides no warrant for circumventing the plain intention of the provision. 68As was stated above, there is no reason to doubt the applicant's evidence that he intended ultimately to reside at the reconstructed Randwick premises as his PPR. But, as Fryberg J established in Deane v Commissioner of Stamp Duties [1996] 2 Qd R 557, the question is to be determined on an objective basis. Intention is relevant and can be taken into account, but it is not a dominant consideration. The objective factors taken into account in that case were "The evidence regarding the applicants' mail, their usage of electricity, the electoral roll, the time which they spent at [the respective residences], the number of nights slept at each place, all combine to found a proper inference...." ([1994] 2 Qd R 557, 567). 69In this case the objective factors, including mailing address, the address on the Telstra bill and the RMS and Electoral Roll Commission records all point to Panania as the applicant's PPR at the relevant time. Further, there is no evidence that the applicant spent any nights at all away from Panania, whether at Randwick (which was impossible) or at any other premises. 70The applicant's expressed intention to retain Randwick as his PPR is relevant, but not a dominant factor. In addition, as was made clear in Aronstan, the intent must "come to fruition". What constitutes fruition for these purposes has yet to be extensively explored in the cases, other than Aronstan itself, where insufficient physical occupation defeated the applicants' claim for exemption. Fruition could mean that the applicant should occupy the premises before the expiration of six months after the taxing date, or should at least commence or resume construction before then, or it could mean any one of a number of dates before the hearing. But on no view could a cessation of construction and a lack of occupation for 2½ years, including over a year after payment of the insurance claim, as in the present instance, be viewed as a case of an intention that has come to fruition. 71The applicant submits that it was only circumstances beyond his control that prevented him from moving out of Panania and back to Randwick. He does not argue that those circumstances activate any discretionary power in the Chief Commissioner or the tribunal (as would have been the case in certain conditions under the repealed cl 6(4)), but says that they fully explain his continued occupation of Panania. 72The fact remains, however, that his intention to occupy Randwick as his PPR did not come to fruition by the taxing date or during the six months before and after it, and that still remains the case. That factors beyond his control were responsible does not lead to the result that the applicant is not entitled to have his actual use and occupation of Panania taken into account under schedule 1A. The objective factors referred to above compel the conclusion that Panania was his principal place of residence at the relevant time, and I so find. 73In conclusion, the applicant is entitled to have his use and occupation of the Panania property as at the taxing date taken into account under schedule 1A, within the meaning of cl 6(7)(a) and consequently the unoccupied land concession provided by cl 6(1) does not apply to the Randwick property in the present case. 74The decision under review is affirmed. 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: 16 July 2014
Theophilas
Chief Commissioner of State Revenue
(2008) 74 NSWLR 481
(1996) 2 Qd R 557
(1990) 168 CLR 614
(1975) 135 CLR 81
(1991) 30 FCR 77
(1979) 143 CLR 284