Clapoudis v Chief Commissioner of State Revenue [2007] NSWADT 133

Set aside by Appeal :

CITATION: Clapoudis v Chief Commissioner of State Revenue [2007] NSWADT 133

DIVISION: Revenue Division

APPLICANT PARTIES: Eva Clapoudis RESPONDENT Chief Commissioner of State Revenue

FILE NUMBER: 066145

HEARING DATES: 14 May 2007

SUBMISSIONS CLOSED: 14 May 2007

DATE OF DECISION: 20 June 2007

BEFORE: Seve J - Judicial Member

CATCHWORDS: First Home Owners grant - approval of application

MATTER FOR DECISION: Principal matter

LEGISLATION CITED : First Home Owner Grant Act 2000

Bell v Scott (1922) 30 CLR 387 Chief Commissioner of State Revenue v Dick Smith Electronics Holdings Pty Ltd [2005] HCA 3 CASES CITED: Commissioner of Stamp Duties v Livingston [1965] AC 694 Harrison v Commissioner of State Revenue (Taxation) [2005] VCAT 966Navakumar v Commissioner of State Revenue (Taxation) [2007] VCAT 476 Parvizzini v Commissioner of State Revenue (Taxation) [2005] VSC 302 Ralara Pty Ltd v Comproller of Stamps 92 ATC 2108

APPLICANT A Giusti, Agent REPRESENTATION: RESPONDENT S Benjamin, Solicitor

ORDERS: The decision of the Commissioner not to approve the application for a grant under the FHOG Act is set aside and in its place is made the decision that the application is allowed and payment to the Applicant of a grant of $7,000 under the FHOG Act is authorised.

REASONS FOR DECISION 1 This application relates a decision of the respondent ("Commissioner") not to approve an application by the Applicant for a grant under the First Home Owner Grant Act 2000 ("FHOG Act"). 2 The Tribunal had before it, documents lodged pursuant to s 58 of the Administrative Decisions Tribunal Act 1997 ("ADT Act") and written submissions on behalf of the Applicant dated 8 March 2007 filed prior to the hearing. The Tribunal also heard oral submissions on behalf of each of the parties at the hearing. Background Facts 3 The following are the background facts which are not in dispute: (1) The husband of the Applicant died on 12 June 2003 ("the Deceased"). (2) The house where the Applicant lived with the Deceased and their daughter, VF, was at 82 Elizabeth Drive, Liverpool ('the Property") and was in the name of the Deceased alone. (3) The Deceased left a will made on 16 January 1995 ("the Will") under which: (i) two daughters from a previous marriage of the Deceased, DD and SF were appointed executrices and trustees of the Will; (ii) two specific bequests were made, in respect to furniture in favour of the Applicant and in respect to an Alfa Romeo in favour of DD; and (ii) the remainder of the Deceased's estate was left upon trust for the trustee to sell and convert into money and after payment of all debts, funeral and testamentary expenses and duties, to hold the net proceeds on trust for DD, SF, the Applicant and VF, in equal shares as tenants in common. (The Applicant was named in the Will as Eva Ferrara, however some time after the death of the Deceased, the Applicant reverted to her maiden name, Eva Clapoudis.) (4) Probate of the Will was granted on 27 August 2004 to DD alone as SF renounced probate. The inventory of the estate of the Deceased annexed to the grant of Probate estimated the total value of the property of the Deceased as $583,220.83, itemised as follows: Interest in the Property with estimated or known value of $500,000 Furniture with estimated or known value of $12,000 Alfa Romeo with estimated or known value of $2,000 Gold chains, gold cross pendant, gold watch and bracelets with estimated or known value of $7,000 Money accounts (four account numbers) with a total amount of estimated or known value of $58,220.83 Money at hand with estimated or known value of $4,000 (5) A caveat was registered against the Property in favour of the Applicant on 24 March 2005. (6) Pursuant to proceedings commenced by the Applicant against DD as executrix of the Will under the Family Provision Act 1982, a judgment order was made in the Supreme Court of NSW on 6 December 2005 ("the Supreme Court Order") as follows: "1. Order pursuant to Sections 7 and 10 of the Family Provision Act that provision be made for the plaintiff, Eva Ferrara, as if the balance of clause 5 of the will dated 16 January 1995 after the words "UPON TRUST" were deleted and the following inserted in lieu thereof: 5. "To pay or distribute thereout: i. a legacy of $40,000 to SF; ii a legacy of $40,000 to DD; iii any Fiat motor vehicle in Italy and my gold pinkie ring which belonged to my mother and AF to SF; My silver plated Army sword to my daughter DD; The rest and residue of my estate to my wife Eva Ferrara". 2. Order that the legacies referred to in clause 1 above be paid on or before 17 March 2006. 3. Order that, in the event that the legacies referred to in clause 1 and the costs referred to in clause 6 are not paid on or before 17 March 2006, that: (a) Interest at the rates prescribed for judgments under the Civil Procedure Act 2005 accrue on the unpaid balance at daily rests as and from 6 December 2005. (b) The defendant be at liberty to enter judgement for possession against the plaintiff Eva Ferrara in respect to all that land contained in folio identifier 3/235647 being all that land known as and situate at 82 Elizabeth Drive, Liverpool and to issue a writ of possession with respect to that property forthwith. 4. Order that, on Sunday 11 December 2005, between 1.00pm and 5.00pm, or such other time as agreed by the parties, the plaintiff, Eva Ferrara, deliver up to the defendant: (a) The motor vehicle referred to in clause 4 of the Deceased's will, (b) The items referred to in paragraph 1 of these orders (with the exception of the vehicle referred to in that Paragraph), and (c) A direction of NR to deliver up the keys and registration papers of the vehicle referred to in (b) to the defendant or her agents. 5. The person collecting the above goods referred to in 4 above is to provide a receipt recording the said collection. 6. Note the undertaking of the plaintiff to the Court Eva Ferrara that she will not apply for a stay of execution of the writ of possession referred to in paragraph 3 (b) hereof. 7. Order that the costs of the Plaintiff, and of the defendant on an indemnity basis, be paid out of the estate of the deceased as agreed or assessed on or before 17 March 2006. 8. Order that the defendant do all acts and things as are reasonably necessary to permit the plaintiff to obtain finance using the property referred to in paragraph 3 (b) above as security for any borrowings she may need to undertake to discharge the obligations under these orders or to pay such legacies." (7) An instrument of transfer ("the Transfer") executed by the solicitor for the transferee (named as the Applicant) and unexecuted by the transferor (named as DD) dated 11/4/2006 in respect to the Property, identifying the Consideration as "Pursuant to Supreme Court Orders made on 6th December 2005" was stamped "10-03-2006 New South Wales Duty Section 68(1) – Original No Duty Payable". (8) The Transfer was subsequently executed by DD as the transferor and re-dated as 4/4/2006 and the Property was registered in the name of the Applicant on 11 April 2006 on which date the Applicant's caveat against the Property was also withdrawn. (9) A mortgage of the Property dated 6 April 2006 was executed by the Applicant in favour of Rams Mortgage Corporation Limited ("Rams"). Such mortgage was stamped and registered on 11 April 2006 against the Property. (10) The Applicant lodged with the Commissioner, an application for a grant under the FHOG Act, on 22 May 2006. The application described the date of settlement of the transaction as 11 April 2007. (11) By letter dated 30 May 2006, the Commissioner notified the Applicant that her application for the grant had not been approved. The letter stated that: "Based on the information you provided, you are not eligible for the grant as there is no evidence that you have paid a consideration for the property. Under Section 18 of The First Home Owners Grant Act, 2000; The amount of a first home owner grant is the lesser of the following:- the consideration for the eligible transaction. $7,000 The transfer provided to our office, indicates there was nil consideration paid for the property at 82 Elizabeth Drive Liverpool NSW 2170. As there was no money paid for the property, the grant cannot be payable." (12) By letter dated 11 July 2006, the Applicant objected to the decision of the Commissioner not to approve the application for the grant. (13) By letter dated 31 October 2006, the Commissioner disallowed the Applicant's objection and advised that: "Section 13(1) of the First Home Owner Grant Act (2000) states that an eligible transaction is a contract made on or after the 1 July 2000 for the purchase of a home in New South Wales. For an applicant to be eligible to receive the grant, they must have acquired the property under an eligible transaction. Unfortunately, when you acquired your home it was pursuant to the due administration of your husband's estate and not via a contract. Please find attached a copy of the case CSR v Joseph Paravizzini [2005] VSC 302 which discusses this issue at great length." (14) The Applicant lodged an application with the Tribunal for review of the Commissioner's decision not to approve the application for the grant. (15) The Applicant is not less than 18 years of age and has been an Australian citizen since 11 March 1970. The Applicant did not own residential property in Australia before the Transfer. The Applicant did not have a spouse or de facto partner at the time of the application. Since before the death of the Deceased, the Applicant has continuously occupied the Property as the principal place of residence of the Applicant. Applicant's Submissions 4 The Applicant submitted that at the time of or upon the transfer of the Property to the Applicant, the Applicant made payments (out of a loan from Rams) to each of the specific pecuniary legatees under the Will (SF and DD), each in the amount of $41,173.70 (being amounts equal to the legacies payable to SF and DD under the Will plus interest as referred to in the Supreme Court Order) and also, to creditors of the Deceased's estate (in a total amount exceeding $100,000) including: (i) the solicitors for the Applicant; (ii) Sydney Water; (iii) Liverpool Council; and (iv) the solicitors for the Deceased's estate. 5 The Applicant's submissions included copies of notices from Rams in respect to 2 bank cheques issued by Rams on 4 April 2006 under a loan by Rams to the Applicant, in the amount of $41,173.70 in favour of SF and in the amount of $41,173.70 in favour of DD. This material corroborated the Applicant's submission that the Applicant made the payments to each of the specific pecuniary legatees under the Will as referred to above. The Applicant's submissions also included a copy of a letter from the Applicant's solicitors to Mortgage Settlements Australia dated 23 March 2006, notifying directions for cheques to be drawn in connection with a loan to the Applicant on security of the Property, in favour of SF and DD, the solicitors for the Applicant and the solicitors for the Deceased's estate, Sydney Water and Liverpool Council and others. This material did not derogate from the Applicant's submission relating to the other payments referred to above. 6 The written submissions made on behalf of the Applicant submitted that: (1) the amount of $41,173.70 paid by the Applicant to each of SF and DD represented the purchase price (consideration) for their respective share of the Property in accordance with the Supreme Court Order; (2) the Supreme Court Order formed a contract for the purchase of the Property by the Applicant, satisfying s 13(a) of the FHOG Act, which contract was made the date of the Supreme Court Order; (3) the Applicant became entitled to possession of the Property on the day of settlement; (4) the Applicant is entitled to a grant under the FHOG Act. 7 At the hearing, the Tribunal indicated to the Applicant's representative, that the Tribunal could not accept that the Supreme Court Order formed a contract for the purchase of a home within the meaning of s 13(a) of the FHOG Act. The Supreme Court Order was not a contract because it was not a legally enforceable agreement made between parties for valuable consideration. It represented orders affecting the Applicant and the executrix of the Deceased's estate and others. 8 At the hearing, the representative for the Applicant submitted that following the Supreme Court Order, the Applicant became entitled to purchase the Property, in consideration of payment of the amounts payable out of the Deceased's estate to SF and DD and to the creditors of the Deceased's estate, including the solicitors for each of the parties to the litigation (as contemplated by the Supreme Court Order). Commissioner's Submissions 9 The Commissioner submitted that the Transfer was not an "eligible transaction" as defined in 13(1) of the FHOG Act. 10 The Commissioner submitted that the facts of this case are relevantly similar to the facts in Parvizzini v Commissioner of State Revenue (Taxation) [2005] VSC 302, which concerned s 13(1)(a) of the First Home Owner Grant Act (2000) (VIC) which is materially the same as 13(1)(a) of the FHOG Act and which held that a transfer of a home pursuant to the administration of an estate is not a contract for the purchase of a home. Legislation 11 Section 13(1) of the FHOG Act defines an "eligible transaction" with three alternatives, only the first of which, in paragraph (a) of s 13(1), is relevant to this case. Section 13(1)(a) provides as follows: "13 (1) An "eligible transaction" is: (a) a contract made on or after 1 July 2000 for the purchase of a home in New South Wales, or" 12 Section 13(5) of the FHOG Act defines when an eligible transaction is "completed" with three alternatives, only the first of which, in paragraph (a) of s 13(5) is relevant to this case. Section 13(5)(a) provides as follows: "(5) An eligible transaction is "completed" when: (a) in the case of a contract for the purchase of a home: (i) the purchaser becomes entitled to possession of the home under the contract, and (ii) except in the case of a terms contract, if the purchaser acquires an interest in land under the contract that is registrable under a law of the State—the purchaser's interest is registered under that law, or" 13 Section 18 of the FHOG Act provides: "8 (1) The amount of a first home owner grant is the lesser of the following: (a) the consideration for the eligible transaction, (b) $7000" Contract for purchase versus Distribution under a will 14 This case hinges on the correct legal characterisation of the Transfer which in turn, depends on the facts of this particular matter. 15 If the Transfer is a distribution of trust property for no consideration under the Will (as contended by the Commissioner), the Transfer is not an "eligible transaction" as defined in the FHOG Act (Parvizzini v Commissioner of State Revenue (Taxation) [2005] VSC 302). 16 However, if the Transfer is a contract for the purchase (or a transfer pursuant to a contract for the purchase) of a home (the Property) for consideration (as contended by the Applicant), there is an "eligible transaction" as defined in the FHOG Act. 17 A contract for the purchase of a home requires both a buyer and a seller and as such, can also be known as a contract for the sale of a home. The distinction between a "sale" (relevant to a contract for purchase) and a distribution of trust property has been addressed in the stamp duty context in Victoria, in respect to the former Stamps Act 1958 (VIC). 18 In Navakumar v Commissioner of State Revenue (Taxation) [2007] VCAT 476, Deputy President Macnamara held as follows, summarizing part of an earlier decision of (then) Member GAA Nettle of the VAAT in Ralara Pty Ltd v Comproller of Stamps 92 ATC 2108: "37. As previously noted the Stamps Act 1958 originally levied a duty upon 'transfers on sale' and a simple distribution of trust property would not have been brought to charge as a transfer on sale because no sale was involved." 19 The following is an extract from the actual decision of (then) Member GAA Nettle in Ralara Pty Ltd v Comproller of Stamps 92 ATC 2108: "10. Before the coming into force of the Stamps (Further Amendment) Act 1981 the transfer the subject of this reference would have satisfied the description of ``conveyance or transfer on sale'' in s 63 of the Act and would have been subjected to duty at the rate provided for in Heading VI in the Third Schedule. The transfer would have been a conveyance or transfer on sale, notwithstanding that it was a transfer as between trustee and beneficiary, because the transfer gave effect to a contract of sale of land under which the transferee gave money or moneys worth for the land which was transferred ( Davies v Collector of Imposts [1908] VLR 272). Contrastingly, before the coming into force of the amending Act, a transfer of land from the trustee of a trust to a beneficiary of the trust in satisfaction of the beneficiary's beneficial entitlement under the trust would not have been a conveyance on sale, although possibly a Deed of Settlement , ( Atkinson v The Collector of Imposts [1919] VLR 105) but s. 89 or s. 89A of the Act would have operated to exempt the transfer from the duty imposed on Deeds of Settlement according to whether the beneficiary was specifically named as an object of a power or was beneficially entitled to the land transferred ( O'Donohue v Comproller of Stamps [1969] VR 431) ( emphasis added ). 11. The Stamps (Further Amendment) Act 1981 abolished the references in the Act to ``conveyance on sale'' and ``deed of settlement'' and replaced them with a new regime, calculated to impose duty at uniform rates on all forms of conveyance. (Comproller of Stamps v Christian [1991] 2 VR 129 at p. 141). Thereafter all conveyances, whether or not on sale, and whether or not such as would once have constituted a deed of settlement for the purposes of the Act, were to be liable to duty as ``conveyances''. The Act was intended to preserve all existing exemptions. Accordingly, some newly formulated exemptions were required to preserve by reference to the newly adopted regime the exemptions which had previously applied to some forms of conveyances on sale and some deeds of settlement." The Transfer - Contract for purchase or Distribution under the Will? 20 It was held in Bell v Scott (1922) 30 CLR 387 by Higgins J (at 392-3) that "…the executor can be compelled to convey the land to the vendor (devisee), or as he directs, on the vendor (devisee) giving the executor any money necessary to pay any debts outstanding" (words in italics added). That is, a devisee under a will has a right to require the executor/trix of the will to convey land the subject of the deceased's estate, to the devisee, on the devisee giving the executor money to pay outstanding debts of the deceased's estate. This is a right at general law and not one arising under a contract for purchase. It is a right that exists independently of an agreement between the executor/trix and the devisee. 21 It is a question of fact as to whether the Transfer in this case was, or was pursuant to a "contract for the purchase" of the Property by the Applicant from the executrix, or, was a distribution in satisfaction of the devise to the Applicant under the Will, following the Applicant "giving" to the executrix of the Will, money necessary to pay the creditors of the Deceased's estate and the specific pecuniary beneficiaries under the Will (as per Bell v Scott (1922) 30 CLR 387). 22 I find the stamping of the Transfer unhelpful in deciding this issue for the following reasons. The Transfer was stamped as not liable to duty under s 68 of the Duties Act 1997. Section 68(1) provides exemption from transfer duty on a transfer, or an agreement for the sale or transfer, of matrimonial property (as defined) if: (a) the property is transferred, or agreed to be sold or transferred, to the parties to a marriage that is dissolved or annulled, or in the opinion of the Chief Commissioner has broken down irretrievably, or to either of them, or to a child or children of either of them or a trustee of such a child or children, and (b) the transfer or agreement is effected by or in accordance with: (i) a financial agreement made under section 90B, 90C or 90D of the Family Law Act 1975 of the Commonwealth that, under that Act, is binding on the parties to the agreement, or (ii) an order of a court under that Act, or (iia) an agreement that the Chief Commissioner is satisfied has been made for the purpose of dividing matrimonial property as a consequence of the dissolution, annulment or breakdown of the marriage, or (iii) a purchase at public auction of property that, immediately before the auction, was matrimonial property where the public auction is held to comply with any such agreement or order. Section 68(5) provides that in s 68: "marriage" includes a void marriage. "matrimonial property" of a marriage means property of the parties to the marriage or of either of them. "party" to a marriage includes a person who was a party to a marriage that has been dissolved or annulled, in Australia or elsewhere. "relationship property" of a domestic relationship means property of the parties to the relationship or of either of them. 23 Stamp duty on the Transfer is not an issue for decision in this matter, however, in my view, the Transfer was ineligible for exemption from duty under s 68 of the Duties Act 1997 because the Property was not "matrimonial property" (as defined in s 68(5)) at the time of the Transfer since, at that time, there was no "marriage" (as defined in s 68(5)) to which the Applicant was a "party" (as defined in s 68(5)). Under the Marriage Act 1961 (Cth),"marriage" is defined as "the union of a man and a woman to the exclusion of all others, voluntarily entered into for life " (emphasis added). The marriage of the Applicant to the Deceased ceased upon the death of the Deceased. The marriage was not dissolved, annulled or void. 24 The question of whether the Transfer was a distribution under the Will or, a transfer on purchase/sale, also affects the stamp duty consequences of the Transfer: (1) If the Transfer was not made for valuable consideration and the Property was the subject of a trust for sale contained in the Will or, the Transfer was made under and in conformity with the trusts contained in the Will, the Transfer should be liable to duty of $10 under s 63 of the Duties Act 1997 . (2) If the Transfer was a transfer on purchase/sale, it would attract ad valorem transfer duty on the greater of the consideration paid for the transfer and the unencumbered value of the Property unless an exemption applies. By way of example, on a dutiable value of $500,000 (which may or may not reflect the dutiable value of the Property as at the date of the Transfer), transfer duty would be $17,990, subject to an exemption being available such as under the First Home Plus Scheme which has eligibility criteria similar but different to the FHOG Act criteria and requires approval by the Commissioner of an application made in the approved form. 25 Stamping of the Transfer under s 68 of the Duties Act 1997 does not assist the Tribunal in deciding this matter. 26 Having considered the material before the Tribunal, I find that the Transfer was by way of a "contract for the purchase" of the Property and not by way of distribution to the Applicant under the Will, for the following reasons. 27 The Transfer describes the consideration as "Pursuant to the Supreme Court Order". The Supreme Court Order varied the Will so that Clause 5 of the Will (as amended) read as follows:- "I GIVE, DEVISE AND BEQUEATH the remainder of my estate both real and personal of whatsoever nature and wheresoever situate unto my Trustee upon trust to sell call in and convert into money (with power to postpone the sale calling in and conversion thereof for so long as my Trustee shall in my Trustees absolute discretion think fit without being responsible for loss or depreciation) and after payment thereout of all my just debts funeral and testamentary expenses and all duties including Federal and State estate duties payable upon or by reason of my death TO STAND POSSESSED of the net proceeds of the sale calling in and conversion of my said real and personal estate and any monies belonging to me at my death and any part or parts of my said real and personal estate for the time being unconverted (all of which is herein called "my residuary estate") UPON TRUST to pay or distribute thereout: i. a legacy of $40,000 to SF; ii a legacy of $40,000 to DD; iii any Fiat motor vehicle in Italy and my gold pinkie ring which belonged to my mother and AF to SF; My silver plated Army sword to my daughter DD; The rest and residue of my estate to my wife Eva Ferrara". 28 The description of the consideration for the Transfer as "Pursuant to the Supreme Court Order" does not necessarily mean that the Transfer was a distribution in satisfaction of a devise to the Applicant under the Will. The meaning of "Pursuant to the Supreme Court Order" is only ascertained from a review of the effect of the Supreme Court Order. The Supreme Court Order varied the Will. As varied, the Will did not entitle the Applicant to a transfer of the Property. The liquid assets of the Deceased's estate were insufficient to meet the debts of the Deceased's estate (including those referred to in the Supreme Court Order) and to pay the specific pecuniary legacies to SF and DD under the Will as varied. The Will, as varied, required that the assets of the Deceased's estate, including the Property (but presumably excluding the Fiat motor vehicle in Italy, gold pinkie ring and silver plated Army sword which were later the subject of further specific bequests under the Will, as varied) be sold by the executrix and converted into money for payment of debts, funeral and testamentary expenses and duties and then, payment of the two pecuniary legacies to SF and DD (and the specific bequests of items of personal property) and then payment of the residue to the Applicant. 29 Accordingly, in the circumstances, the description of the consideration for the Transfer as "Pursuant to the Supreme Court Order" supports an inference (being the Applicant's submission) that the Applicant purchased the Property. That is, in accordance with the Will as varied by the Supreme Court Order, the executrix sold the Property (to the Applicant) and converted it into money which was used to pay the debts and funeral and testamentary expenses of the Deceased's estate and the two specific pecuniary bequests, with the residue (if any) set off against the balance (if any) of the purchase price payable by the Applicant. 30 For the Transfer to have been by way of distribution to the Applicant under the Will (as varied by the Supreme Court order), the amounts paid by the Applicant at the time of the Transfer, to the payees of those amounts must have either been: (1) paid by the Applicant as consideration for the extinguishment of respective rights of the payees against the Deceased's estate; or (2) paid by way of gift or loan to the executrix by the Applicant, on behalf of the executrix, such that the payments were in satisfaction of the debts of the Deceased's estate and the specific pecuniary bequests under the Will. 31 There is nothing in the evidence that indicates that the Applicant had agreements with each of the respective payees of the amounts paid by the Applicant at the time of the Transfer, for extinguishment of their respective rights against the Deceased's estate. On the evidence, including the litigation by the Applicant against the Deceased's estate, I find it is reasonable to infer that the payments made by the Applicant were made on behalf of the executrix for the Deceased's estate rather than in the Applicant's own right. This is different to the situation in Parvizzini v Commissioner of State Revenue (Taxation) [2005] VSC 302 referred to in more detail later hereunder. 32 On the basis that the payments by the Applicant were made on behalf of the executrix for the Deceased's estate, I find that the payments were made at the direction of the executrix for the Deceased's estate, under a contract for purchase of the Property by the Applicant rather than by way of gift or loan by the Applicant to the Deceased's estate. 33 This is because, in the circumstances of the litigation by the Applicant against the executrix of the Will, it is unlikely that the Applicant would have gifted the amounts paid by the Applicant at the time of the Transfer to the Deceased's estate. If the Applicant had loaned the amounts to the executrix, the transfer of the Property would have been, in part, in satisfaction of such loan and, not solely by way of distribution under the Will which would have been a more complicated arrangement. For this reason and having regard to the litigation by the Applicant against the executrix of the Will which led to the Supreme Court Order, I do not find it reasonable to infer that the Applicant made a loan to the executrix. 34 The fact that the amount paid by the Applicant at the time of the Transfer was (as the Applicant indicated at the hearing) less than the full value of the Property at that time, does not derogate from a finding that the Applicant purchased the Property from the executrix of the Deceased's estate. The Property may have been sold for full value, with the balance of the purchase price (above the total amount paid by the Applicant) having been set off against the amount due to the Applicant as the residuary beneficiary under the Will, or, the Property may have been sold for less than full value with the approval of the Applicant (as the sole residuary beneficiary under the Will). 35 The Applicant would only have been entitled to a transfer the Property under the Will, after the debts of the Deceased's estate and the specific pecuniary legacies under the Will had been paid. In this case, according to the evidence of the Applicant which has not been refuted by the Commissioner, the debts of the Deceased's estate and the specific pecuniary legacies were paid "upon" the transfer of the Property and not before it. This supports a finding that the Transfer was a transfer of the Property to the Applicant for valuable consideration and that the Applicant never became entitled to a distribution of the Property under the Will. 36 According to Chief Commissioner of State Revenue v Dick Smith Electronics Holdings Pty Ltd [2005] HCA 3, the "consideration" for a transaction is that which "moved" the transaction. I find that the Transfer was "moved" by the payments made by the Applicant to the creditors of the Deceased's estate and the specific pecuniary legatees under the Will and that such payments, which exceeded $7,000 in amount, were consideration for the Transfer. 37 In the VCAT decision of Harrison v Commissioner of State Revenue (Taxation) [2005] VCAT 966, Deputy President MacNamara reversed a decision of the Commissioner of State Revenue in Victoria to refuse a grant under the First Home Owner Grant Act 2000 (VIC). It was held in that case, that the applicant had acquired by settlement of a contract of sale with his sister, a right to possession which was quite distinct and materially different from any right to possession that he acquired as beneficiary under the will of his late mother. Adopting this approach, I find that the Applicant in this case acquired a right to possession of the Property upon payment of the moneys paid by the Applicant to the creditors of the Deceased's estate and the specific pecuniary legatees under the Will, and that the Applicant never acquired any right to possession of the Property as a beneficiary under the Will. Parvizzini's Case 38 Parvizzini v Commissioner of State Revenue (Taxation) [2005] VSC 302 ("Parvizzini's Case") is distinguishable from this case for the following reasons. 39 In Parvizzini's Case, unlike the facts of this matter, the applicant for the grant ("the respondent") was the executor of his late mother's will and also, a beneficiary of a specific bequest of the subject property under his late mother's will, to the respondent and the respondent's two sisters. The respondent paid moneys to each of his two sisters and transferred the subject property from himself as executor, to himself in his personal capacity. Hansen J held (at 51) as follows: "51. There was simply no evidence that there was a contract between the respondent as executor (representing the estate) and the respondent in his personal capacity whereby the latter purchased the property from the estate. On the contrary, the respondent paid the consideration directly to his sisters. I accept the Commissioner's argument that, in the absence of any evidence of an agreement between all the beneficiaries that the property be purchased from the estate, the only conclusion open to the Tribunal was that there was a contract between the respondent (in his personal capacity) and his sisters whereby the sisters disclaimed the gift of the property under the will, in consideration of money paid to them by the respondent. That, of course, did not affect their right to share in the residuary estate, or at least there is no evidence that the sisters gave up that right, just as there is no evidence as to the overall assets and liabilities of the estate." 40 An agreement between all the beneficiaries would have been required in Parvizzini's Case, for a sale of the subject property by the estate, because a specific bequest of the subject property had been made under the will, to the beneficiaries. In this case, no such agreement between all the beneficiaries was required. The Property was not the subject of a specific bequest under the Will. To the contrary, the Will contemplated the sale of the Property, with the proceeds on sale being applied in accordance with the Will as varied by the Supreme Court Order. The conclusion of the Court in Parvizzini's Case, that there was a contract between the respondent (in his personal capacity) and his sisters whereby the sisters disclaimed the gift of the property under the will, in consideration of money paid to them by the respondent was drawn (at least in part) from this fact. In this case, for the reasons earlier mentioned, the Tribunal has not inferred a contract (s) between the Applicant and the SF and DD (in her personal capacity) disclaiming their respective rights under the Will. Different to the facts of Parvizzini's Case which involved a specific bequest of the subject property, there is no reason in this case that compels the Tribunal to reach such a conclusion. Also different to the facts of Parvizzini's Case, in this case, payments were additionally made by the Applicant to creditors of the Deceased's estate. As aforementioned, there is nothing in the evidence that leads to an inference that there were contracts between the Applicant and the creditors of the deceased's estate, for disclaimer of the creditor's respective rights against the Deceased's estate. Conclusion 41 For the foregoing reasons, I find that the Transfer was not by way of distribution to the Applicant as a beneficiary under the Will but was itself or, was made pursuant to, a contract for the purchase of the Property entered into between the Applicant and the executrix of the Will, after the Supreme Court Order was made. As such, I find that there is an "eligible transaction" as defined in s 13(1)(a) of the FHOG Act. 42 I also find that the Applicant complies with the eligibility criteria (as defined in the FHOG Act) since: (1) the Applicant is a natural person of not less than 18 years of age and is an Australian citizen; (2) it has not been asserted nor is there any evidence to suggest that the Applicant held a relevant interest (as defined in the FHOG Act or in a corresponding law) in residential property in Australia before 1 July 2000; (3) it has not been asserted nor is there any evidence to suggest that the Applicant has previously been a party to an earlier application under the FHOG Act or a corresponding law; (4) it has not been asserted nor is there any evidence to suggest that the Applicant had a spouse or de facto partner at the time of the Transfer and as such, there is no spouse or de facto partner that affects the Applicant's application; (5) the Applicant commenced occupation of the Property as the principal place of residence of the Applicant before the death of the Deceased and has continuously occupied the Property as the principal place of residence of the Applicant afterwards (including continuously for more than 6 months commencing within 12 months after completion of the Transfer). Although s 12(1)(a) of the FHOG Act requires that an applicant "commence occupation" of the home to which the application relates as the applicant's principal place of residence within 12 months "after" completion, I do not find that this should be interpreted strictly to exclude applicants who commence continuous occupation of a home "before" completion of the eligible transaction. This view is supported by the following. The definition of "completion" in s 13(5)(a) provides that: "An eligible transaction is "completed" when: (a) in the case of a contract for the purchase of a home: (i) the purchaser becomes entitled to possession of the home under the contract, and (ii) except in the case of a terms contract, if the purchaser acquires an interest in land under the contract that is registrable under a law of the State—the purchaser's interest is registered under that law (emphasis added)" 43 It would not be uncommon for purchasers of a home to commence occupation of the home from settlement of the purchase and before the transfer is registered. If the reference to s 12(1)(a) to "commence" is interpreted strictly, first home buyer applicants in these common circumstances would fail the residence requirement under s 12(1)(a) of the FHOG Act and would need to apply for exemption from the residence requirement under s 12(4) of the FHOG Act. (Section 12 (3)(a) of the FHOG Act only empowers the Commissioner to approve a period more than 12 months "after" completion.) This could not have been intended. 44 The First Home Owner Grant scheme is a national scheme. In Victoria, s 12(1) of the FHOG Act 2000 (VIC) provides as follows: "An applicant for a first home owner grant must occupy the home to which the application relates as the applicant's principal place of residence for a continuous period of at least 6 months (or the lesser period approved by the Commissioner) commencing within the 12 month period immediately after completion of the eligible transaction or within a longer period approved by the Commissioner." 45 In my view, "commence" in s 12(1)(a) is intended to relate to the date from which the 12 month period is to begin, rather than to occupation itself, in the way that the Victorian provision does (as so to do the provisions in all other States and Territories (Tasmania (s12(1)), Queensland (s15), WA (s13), ACT (s12), SA (s12) and NT (s12)) . That is, commencing within 12 months after completion, the applicant must occupy the home as the applicant's principal place of residence. On this view, the residence requirement (as defined in s 12 of the FHOG Act) is satisfied in this case. If however I am wrong in this view, and the Applicant failed to satisfy s12(1)(a) because she did not "commence occupation" of the Property "after" completion of the Transfer, because she "commenced" occupation "before" completion of the Transfer, for the foregoing reasons, in my view, this is an unintended consequence which is a "good reason" for the Commissioner to exercise his discretion under s 12(4) of the FHOG Act, to exempt the Applicant from the residence requirement in this case. (A similar issue arises in the context of the First Home Plus Scheme under s 76(1) of the Duties Act 1997 .) 46 Accordingly, on the material before the Tribunal, the Applicant has proved her case as required under s 28(3) of the FHOG Act and the Tribunal is satisfied that a first home owner grant is payable to the Applicant under the FHOG Act. 47 Since the consideration for the Transfer exceeded $7,000, under s 18(1) of the FHOG Act, the amount of the grant payable to the Applicant is $7,000. 48 Although this case does not require the issue of stamp duty on the Transfer to be decided, before finally concluding, I make the following observations in the circumstances of this matter: (1) If the dutiable value of the Property was, at the time of the Transfer, $500,000 or less, the Transfer may be eligible for exemption from duty under the First Home Plus Scheme under the Duties Act 1997 (s 80(1)(a)). (2) If the dutiable value of the Property was more than $500,000 and less than $600,000 at the date of the Transfer, the Transfer may be eligible for the concessional rate of duty under s 80(1)(b) of the Duties Act 1997. (3) If the dutiable value of the Property was $600,000 or more at the date of the Transfer, the Transfer is ineligible for exemption or a concessional rate of duty under the First Home Plus Scheme under the Duties Act 1997 ( s 74(3)). (4) In the context of s 71 (1)(a) of the Duties Act 1997, the Commissioner did not dispute that the Applicant did not own residential property in Australia before the Transfer and the Applicant's right as a beneficiary under the Will before the Transfer, was not an interest in the Property but a personal right to due administration of the Deceased's estate (Commissioner of Stamp Duties v Livingston [1965] AC 694 at 707-708). (5) Section 71(2) of the Duties Act 1997 should not be applicable on the basis that it is not asserted that the Applicant had a spouse or de facto partner at the time of the Transfer. (6) For the exemption or the concessional rate of duty under the First Home Plus Scheme under the Duties Act 1997 to apply to the Transfer, the Applicant would need to meet the eligibility criteria and make an application to the Commissioner, by completing a statutory declaration in the approved form (s 78(1) of the Duties Act 1997) and such application would need to be approved by the Commissioner. Although under the Duties Act 1997 as it applied at the time of the Transfer, s 79 of the Duties Act 1997 invested an absolute and non-reviewable discretion in the Commissioner in determining applications of this kind, s 79 was repealed on 20 June 2006 and no longer applies to applications made on or after 20 June 2006. (7) The mortgage of the Property to Rams may be eligible for exemption from mortgage duty under the First Home Plus Scheme (s 221 of the Duties Act 1997). Again, for the exemption under the First Home Plus Scheme under the Duties Act 1997 to apply, the Applicant would need to meet the eligibility criteria and make an application to the Commissioner, by completing a statutory declaration in the approved form (s 78(1) of the Duties Act 1997) and such application would need to be approved by the Commissioner. 49 The correct and preferable decision on the application in this matter is to make the following order. Order 50 The decision of the Commissioner not to approve the application for a grant under the FHOG Act is set aside and in its place is made the decision that the application is allowed and payment to the Applicant of a grant of $7,000 under the FHOG Act is authorised.