CITATION: Hiley v Chief Commissioner of State Revenue [2009] NSWADT 133 DIVISION: Revenue Division PARTIES: APPLICANT Rebecca Hiley FILE NUMBER: 086102 HEARING DATES: 20 April 2009 SUBMISSIONS CLOSED: 20 April 2009 DATE OF DECISION: 9 June 2009 BEFORE: Perrignon R - Judicial Member CATCHWORDS: First home owner grant, stamp duty, first home plus scheme, estoppel LEGISLATION CITED : First Home Owner Grant Act 2000Duties Act 1997Taxation Administration Act 1996 Chief Commissioner of State Revenue v Paspaley [2008] NSWCA 184 McTackett v Chief Commissioner of State Revenue [2003] NSWADT 154 BBLT & ors v Chief Commissioner of State Revenue (NSW) 2003 ATC 5063 Chief Commissioner of State Revenue v Aldridge & Anor [2003] NSWADTAP 50 CASES CITED: AGC (Investments) Ltd v FC of T 91 ATC 4180 Stature Pty Limited v Chief Commissioner of State Revenue [2002] NSWADT 271 Ryan & anor v Commissioner of Land Tax [1982] 1 NSWLR 305 Sweeney v Fitzhardinge (1906) 4 CLR 716 Commissioner of Stamp Duties v Permanent Trustee Co Limited (1987) 9 NSWLR 917 Western City Developments Pty Limited v Chief Commissioner of State Revenue [2008] NSWADT 293 APPLICANT In person REPRESENTATION: RESPONDENT Adam Gerard, solicitor 1. The decision made by the Chief Commissioner of State Revenue on 11 July 2008 to reverse his decision to authorise the first home owner grant is affirmed ORDERS: 2. The decision made by the Chief Commissioner of State Revenue on 20 August 2008 to reverse his decision to approve Ms Hiley's application for the 'First Home Plus' concession is affirmed 3. The decision made by the Chief Commissioner of State Revenue on 20 August 2008 to reassess stamp duty is affirmed 4. By consent of the Chief Commissioner of State Revenue, his decision of 20 August 2008 to impose interest on the said stamp duty is set aside and replaced by a decision to impose no interest. REASONS FOR DECISION 1 On 18 April 2008, the Applicant Ms Hiley entered into a contract to purchase a home at Forster in New South Wales. 2 About a fortnight earlier, she had applied to the Office of State Revenue for a ruling on her eligibility for the first home owner grant, and for stamp duty exemption or concession under the 'First Home Plus' scheme. A financial adviser had suggested she do so prior to contract. She was unaware that it was not the practice of the Respondent, the Chief Commissioner of State Revenue, to give such rulings. 3 From about 1 to 3 April 2008, she corresponded with the Office of State Revenue. From that correspondence, she inferred that she would be eligible for the first home owner grant and the 'First Home Plus' concession, if the house standing on her rural property at Elands, New South Wales, was uninhabitable, and certified to be so by the local council. She had lived there with her late husband from about 1995 to 1999, owning the property with him as joint tenants from 14 August 1996. Her husband had died there in April 2000. Since then, she had not returned to live at the property, preferring to live in rented accommodation, and the house had become run down. She had become the sole registered proprietor, by right of survivorship. 4 Relying on the advices of the Office of State Revenue, Ms Hiley arranged for an officer of the Greater Taree City Council to inspect the house at Elands, and on 17 April 2008 he declared it "not suitable for human habitation". 5 On that same day – the day before signing the contract for purchase – Ms Hiley filled out applications for the first home owner grant and 'First Home Plus' duty concession. Her solicitor witnessed each application. Ms Hiley gave her application for the first home owner grant to her bank, for forwarding to the Chief Commissioner. She left the application for the 'First Home Plus' concession with her solicitor. He was empowered to stamp documents as a delegate of the Chief Commissioner, pursuant to a scheme administered by the Chief Commissioner. 6 In the expectation that both applications would be granted in due course, Ms Hiley signed the contract to purchase her Forster home on 18 April 2008. 7 On 10 June 2008, the transfer was signed by the vendor. Ms Hiley's solicitor stamped it as exempt from duty. In all likelihood, he did so because he considered Ms Hiley to be eligible for the 'First Home Plus' concession. 8 On 3 July 2008, Ms Hiley's application for the first home owner grant was received by the Chief Commissioner. 9 On 11 July 2008 it was declined, because Ms Hiley had been the registered proprietor of the property at Elands prior to 1 July 2000. In the Commissioner's view, this meant that she failed to satisfy the fourth criterion for eligibility in section 11 of the First Home Owner Grant Act 2000 – namely, that the applicant should not have held a 'relevant interest' (defined to include an estate in fee simple) in residential land before 1 July 2000. 10 The Chief Commissioner then inquired into Ms Hiley's exemption from stamp duty. He concluded that she was also ineligible for the 'First Home Plus' concession, because she had owned 'residential property in Australia', and therefore was not a 'first home owner' as defined in section 71 of the Duties Act 1997. 11 On 20 August 2008, he reversed the decision to approve her application for concession under the 'First Home Plus' scheme. He re-assessed stamp duty under section 9(1) of the Taxation Administration Act 1996 in the sum of $15,967, and charged interest of $227.34. The rate of interest included the premium rate of 8% plus the Reserve Bank bill rate. 12 Ms Hiley lodged objections to the Chief Commissioner's decisions of 11 July and 20 August 2008. Her objections were disallowed. 13 She now seeks review by the Tribunal of each of those original decisions. Jurisdiction 14 The Tribunal's power to review decisions of the Chief Commissioner on an application for the first home owner grant derives from section 28(1) of the First Home Owner Grant Act 2000. The power of review is confined to decisions which may be, and have been, the subject of objection by an applicant or former applicant under section 25(1) of that Act. 15 In this case, Ms Hiley has objected to the decision of 11 July 2008, and is dissatisfied with the Chief Commissioner's determination of her objection. It follows that the Tribunal enjoys jurisdiction to review the decision of 11 July 2008. 16 The Tribunal's power to review decisions of the Chief Commissioner under the Duties Act 1997 derives from section 96(1) of the Taxation Administration Act 1996. The power of review is confined to decisions which may be, and have been, the subject of objection by the taxpayer under Division 1 of the Act: Chief Commissioner of State Revenue v Paspaley [2008] NSWCA 184. 17 Ms Hiley has objected to the decisions of 20 August 2008. Her objections have been disallowed by the Chief Commissioner, and Ms Hiley is dissatisfied with the result. It follows that the Tribunal enjoys jurisdiction to review the decisions of 20 August 2008. Issues for determination 18 Before the Tribunal, Ms Hiley represented herself. She made no submissions as to whether she satisfied the statutory criteria for eligibility for the first home owner grant or the 'First Home Plus' concession. Instead, she made submissions to the following effect: 1. The Chief Commissioner's responses to her email queries were by their nature misleading, in that that they were capable of being interpreted as meaning that her eligibility for the first home owner grant and 'First Home Plus' concession depended on whether the house at Elands was then uninhabitable. 2. She interpreted the responses in that manner, and was to that extent misled. 3. In reliance on the Chief Commissioner's responses, and under a misconception as to her eligibility, she made an offer on the home at Forster, and entered into a contract to purchase it. 4. But for that misconception, she would have made a lesser offer than the one she did in fact make. 19 Ms Hiley was not able to say whether such an offer would have been accepted. Nor did she go so far as to submit that, but for her misconception, she would not have purchased the house for the price she ultimately paid. 20 The Chief Commissioner submitted that, on the proper construction of the correspondence, no incorrect advice was given. Even if it was, he submitted, he could not be estopped from making decisions in accordance with the statutes which he administered. However, without admission as to any other matter, he did concede that in the circumstances of this case interest ought not be charged on the unpaid stamp duty. In light of the observations of the Appeals Panel of this Tribunal in Chief Commissioner of State Revenue v Aldridge & Anor [2003] NSWADTAP 50, that concession was properly made, and is reflected in the Tribunal's orders. It is unnecessary to consider the issue of interest further. 21 The remaining issues for determination may be summarised as follows. 1. Whether Ms Hiley satisfied the eligibility requirements for the first home owner grant under section 11 of the First Home Owner Grant Act 2000 . 2. Whether she was a 'first home owner' as defined in section 71 of the Duties Act 1997 , so that she satisfied the eligibility requirements for the 'First Home Plus' scheme. 3. Whether the Chief Commissioner's responses to Ms Hiley's queries prior to contract were by their nature misleading. 4. If so, whether the Chief Commissioner was estopped or otherwise prevented from making the decisions which he did on 11 July and 20 August 2008, and whether the Tribunal, on review of those decisions, is estopped or otherwise prevented from affirming them. Facts 22 The facts as summarised above are not in dispute. The Tribunal makes findings in accordance with them. 23 Each of the issues for determination may now be considered in turn. Eligibility for the first home owner grant 24 To be eligible for the first home owner grant, an applicant must comply with the eligibility criteria in Part 2, Division 2 of the Act: section 7, First Home Owner Grant Act 2000. The fourth criterion is set forth in section 11, which provides as follows. "11 Criterion 4—Applicant (or applicant's spouse) must not have had relevant interest in residential property (1) An applicant for a first home owner grant is ineligible for the grant if the applicant or the applicant's spouse has, before 1 July 2000, held: (a) a relevant interest in residential property in New South Wales, or (b) an interest in residential property in another State or a Territory that is a relevant interest under the corresponding law of that State or Territory. (2) In working out for the purposes of subsection (1) whether an applicant held a relevant interest (within the meaning of this Act or a corresponding law) in residential property at a particular time, any deferment of the applicant's right of occupation (because the property was subject to a lease) is to be disregarded. (3) An applicant is also ineligible if the applicant or the applicant's spouse has, at any time before the commencement date of the eligible transaction to which the application relates: (a) held a relevant interest in residential property in New South Wales or an interest in residential property in another State or a Territory that is a relevant interest under the corresponding law of that State or Territory, and (b) occupied the property as a place of residence for a continuous period of at least 6 months." 25 "Relevant interest" is defined to include an estate in fee simple: section 5(1)(a). 26 "Residential property" is defined to include, at any particular time, land in Australia which has at the time "a building on the land lawfully occupied as a place of residence or suitable for occupation as a place of residence": section 3. 27 From 14 August 1996, Ms Hiley has held an estate in fee simple in the property at Elands. Until the death of her husband in April 2000, the house there was lawfully occupied as a place of residence. Thus, the property fell within the definition of 'residential property' in section 3, and Ms Hiley held a relevant interest in residential property prior to 1 July 2000. 28 When she applied for the first home owner grant in 2008, she did not satisfy the fourth criterion for eligibility, and for that reason was ineligible for the grant. Eligibility for 'First Home Plus' concession 29 The 'First Home Plus' scheme is governed by Chapter 2, Part 8 of the Duties Act 1997. To be eligible, an applicant must be a 'first home owner' as defined in section 71(2) of that Act, which provides as follows. "(2) A first home owner is an individual: (a) who has not at any time owned residential property in Australia (either solely or with someone else) and has not previously been a party to an application under the scheme that was approved by the Chief Commissioner, and (b) whose spouse (if any) has not at any time owned residential property in Australia (either solely or with someone else) and has not previously been a party to an application under the scheme that was approved by the Chief Commissioner." 30 The phrase 'residential property' is not defined in the Duties Act 1997. As Hunt J observed in Ryan & anor v Commissioner of Land Tax [1982] 1 NSWLR 305 at 309: "In the absence of any context indicating a contrary intention, it is a sound rule of statutory construction to presume that the legislature intended to attach the same meaning to the same words both in different parts of the same statute and in different statutes in pari materia or in statutes dealing with the same general subject matter: Courtauld v Legh (1869) LR 4 Exch 126, at p 130; Lennon v Gibson and Howes Ltd [1919] AC 709, at pp 711, 712; Beaman v ARTW Ltd [1949] 1 KB 550, at p 567 ." 31 In that case, Hunt J. construed the words "parcel of residential land" in section 10(1)(r)(ii) of the Land Tax Management Act 1956 (NSW), in the same way that "land" and "parcel of the land" had previously been construed in earlier versions of that Act. 32 Definitions provided in one statute may the more readily be applied in construing another, where the two form part of a scheme of legislation: Sweeney v Fitzhardinge (1906) 4 CLR 716; Commissioner of Stamp Duties v Permanent Trustee Co Limited (1987) 9 NSWLR 917. 33 The Long Title of the First Home Owner Grant Act 2000 provides as follows: "An Act to encourage and assist home ownership, and to offset the effect of the Goods and Services Tax on the acquisition of a first home, by establishing a scheme for the payment of grants to first home owners; to amend the Stamp Duties Act 1920 to exempt such grants from financial institutions duty; and for other purposes." 34 The nature of the 'First Home Plus' scheme is set forth in section 69 of the Duties Act 1997: "This scheme is intended to help people who are acquiring their first home. Under the scheme, the acquisition and any mortgage given to assist the financing of the acquisition is subject to a concession or exemption from duty." 35 Thus the two Acts, so far as they provide assistance to first home buyers, form part of the same legislative scheme, and are in pari materia. It would be remarkable if the eligibility criteria for the first home owner grant differed materially from those for the 'First Home Plus' scheme. In the absence of clear evidence of any such intention, it is likely that parliament intended like terms to have like meanings. 36 Therefore the phrase 'residential property' when used in section 71(2) of the Duties Act 1997 should be construed as having the same meaning as when used in section 11 of the First Home Owner Grant Act 2000. 37 It follows that, at the time of her application in 2008, Ms Hiley was not a 'first home owner' within the meaning of section 71(2), and was therefore ineligible for the 'First Home Plus' concession. Representations of the Chief Commissioner's staff 38 Ms Hiley's correspondence with staff of the Office of State Revenue was in the following terms, excluding pleasantries and salutations. Staff members are referred to simply as "OSR". I intend on purchasing my first home, and I write to clarify whether I am eligible for: Ms Hiley: First Home Plus Scheme & First Home Owners Grant. I currently own farmland (214 acres) which was passed onto my now deceased husband and myself, from his father, some years ago. As this property that I currently own is zoned rural, as opposed to residential, and as I haven't previously claimed any concessions in the way of a first home, I would appreciate a clear ruling on whether I am able to take advantage of the above. OSR: Please advise what date the farmland was transferred into your deceased husbands [sic] and your name. Ms Hiley: The rural property was transferred into our names on the 6/8/1996. If the property you own is just a vacant block of land (ie no dwelling on it) and if you did not claim the stamp duty exemption/ discount back then on that transfer, you may be able to claim the stamp duty exemption/discount on the purchase of your first home now provided that the purchase price is within the threshold and you meet the rest of the eligibilty [sic] criteria. OSR: If all you have owned so far is just that vacant block of land, then you will also be able to apply for the grant of $7000, when you buy your first home to live in. For more information on how both schemes work, please visit our website at www.osr.nsw.gov.au. Alternatively, you may call us on 1300 130 624. Ms Hiley: I would like to clarify, the rural zoned block transferred in 1996 did and does have a dwelling on it (albeit an old settlers cottage which I do not reside in) – there was no stamp duty exemption claimed, and of course no application for grant. Please advise how the date of transfer, and whether the rural property has a dwelling on it affects my eligibility for the two benefits. OSR: Your eligibility for both the schemes will depend on whether the local council deems the cottage (sitting on that block of land) as "habitable" or not. You will need something in writing from the council to state that. If the council deems it as unhabitable [sic] then you may be able to apply for both schemes. If it considers it as habitable then you will be dis-qualified. [sic] 39 The first sentence of the final advice was expressed in unqualified terms: "Your eligibility for both the schemes will depend on whether the local council deems the cottage (sitting on that block of land) as "habitable" or not." 40 In the factual circumstances which then obtained, this statement was wrong. As the Tribunal has found, Ms Hiley was ineligible for the grant, because she had owned residential property prior to 1 July 2000. Her eligibility did not depend, in whole or in part, on whether the house was habitable in 2008. 41 As the Chief Commissioner has submitted, Ms Hiley did not disclose that she had ever lived at Elands. She was not asked that question. 42 He also submits correctly that the relevant staff member did not, in terms, say that Ms Hiley was eligible under either scheme. That inference was available to be drawn from the first and second sentences, in combination with the certificate of the Greater Taree City Council. 43 It is also true that, on close examination, the first sentence was inconsistent with the third - namely, that Ms Hiley 'may be able to apply for both schemes' if the house was uninhabitable (emphasis added). 44 However, none of these circumstances makes the first sentence any more accurate, or any less misleading. 45 The Tribunal accepts Ms Hiley's unchallenged evidence that she accepted the first sentence as being true, and acted in reliance upon it. She does not allege that, but for the misrepresentation, she would have refrained from purchasing the house at Forster, or that she would have successfully bargained for a lower price, even if she would have offered one. Accordingly, the Tribunal does not find that she relied on the misrepresentation to her detriment. 46 It remains to consider whether the Chief Commissioner was thereby estopped or otherwise prevented from making decisions inconsistently with the advices given to Ms Hiley, or with any part of those advices. 47 In Stature Pty Limited v Chief Commissioner of State Revenue [2002] NSWADT 271, the Tribunal found as follows [at paragraph 11]. "… the doctrine of estoppel does not apply to prevent the Chief Commissioner from attending to his statutory duties. It is well established that the doctrine of estoppel cannot be invoked by a taxpayer so as to prevent the Commonwealth Commissioner of Taxation assessing tax pursuant to the statutory duty so to do. (cf. Kitto J in Federal Commissioner of Taxation v Wade (1951) 84 CLR 105 at 117 and approved by the High Court in several subsequent cases including Federal Commissioner of Taxation v ANZ Savings Bank Ltd (1994) 181 CLR 466, Chamberlain v Deputy Commissioner of Taxation (1988) 164 CLR 502 and Federal Commissioner of Taxation v Ryan (2000) 168 ALR 704). As stated by Hill J, very succinctly and unequivocally, in AGC (Investments) Ltd v FC of T 91 ATC 4180 at p. 4195: "....there is no room for the doctrine of estoppel operating to preclude the Commissioner of Taxation from pursuing his statutory duty to assess tax in accordance with law. The Income Tax Assessment Act imposes obligations upon the Commissioner and creates public rights and duties, which the application of the doctrine of estoppel cannot be invoked by a taxpayer so as to prevent the Commissioner assessing pursuant to his duty so to do. The cases certainly support that view." 48 In Chief Commissioner of State Revenue v Aldridge & Anor [2003] NSWADTAP 50, the Appeals Panel of the Tribunal found [at paragraph 33]: "The Chief Commissioner cannot be estopped from administering the law in accordance with its terms ( ISPT Nominees Pty Ltd v Chief Commissioner of State Revenue [2003] NSWSC 697; Stature Pty Ltd v Chief Commissioner of State Revenue [2002] NSWADT 271). As such, the Respondents cannot be exonerated from liability to land tax by virtue of any reliance on a Revenue Ruling published by the Chief Commissioner that is misleading or incorrect. Reliance on a misleading or incorrect Revenue Ruling might be reasonable grounds for waiver of interest or penalties for late payment of land tax, but not the land tax itself." 49 In BBLT & ors v Chief Commissioner of State Revenue (NSW) 2003 ATC 5063, Gzell J in the Supreme Court of New South Wales observed [obiter at paragraph 111]: "... with few exceptions the courts have concluded that estoppel does not lie against a fiscal authority on the basis that the authority cannot be prevented from carrying out the public duties cast upon it by the legislation (FC of T v Wade … (1951) 84 CLR 105; AGD (Investments) Ltd v FC of T 91 ATC 4180; FC of T v Australian & New Zealand Savings Bank Ltd … (1994) 181 CLR 466; Bellinz Pty Limited &Ors v FC of T 98 ATC 4634; … Oamington Pty Ltd (Receiver and Manager Appointed) & Anor v Commr of Land Tax & Anor 98 ATC 5051) ." 50 In these cases, the Tribunal or Court was concerned with the imposition of land tax. However, the principle extends to fiscal authorities generally: BBLT v CCSR. It has been applied to decisions of the Chief Commissioner to impose stamp duty: Western City Developments Pty Limited v Chief Commissioner of State Revenue [2008] NSWADT 293. It has also been applied to decisions made by him in respect of the first home owner grant: McTackett v Chief Commissioner of State Revenue [2003] NSWADT 154. 51 In McTackett's case, Judicial Member Montgomery observed [at paragraph 23]: "In my view, the doctrine of estoppel does not apply to prevent the [Chief Commissioner of State Revenue] from attending to his statutory duties. … The doctrine of estoppel cannot operate to force the Commissioner to make a grant that would otherwise be precluded under the [ First Home Owner Grant Act 2000 ]. It follows in my view that the Commissioner would be required to decline Mr McTackett's application for the further $7,000 grant regardless of whether [Office of State Revenue] staff had given Mr McTackett wrong advice and regardless of whether Mr McTackett had relied on that advice." 52 No authority has been cited to the Tribunal which might support an exception to the rule in the circumstances of this case. 53 It follows that, even if Ms Hiley was misled by the advice of the Office of State Revenue, neither the Chief Commissioner, nor the Tribunal on review of his decisions, is estopped or otherwise prevented from making decisions in respect of the first home owner grant or 'First Home Plus' scheme in accordance with the provisions of the relevant statutes. 54 Accordingly, the decisions under review ought be affirmed, subject to the Chief Commissioner's proper concession as to interest. The Tribunal determines each of the issues as follows. 1. Ms Hiley was not eligible for the first home owner grant, because she had held a relevant interest in residential property in New South Wales prior to 1 July 2000, and for that reason failed to satisfy the fourth criterion for eligibility set forth in section 11 of the First Home Owner Grant Act 2000 . 2. Ms Hiley was not eligible for stamp duty concessions under the 'First Home Plus' scheme, because she had owned the property at Elands prior to 1 July 2000, and therefore did not satisfy the definition of 'first home owner' in section 71 of the Duties Act 1997. 3. The responses by Office of State Revenue staff to Ms Hiley's queries prior to contract were misleading, though not intentionally so. 4. The Chief Commissioner was not thereby estopped or otherwise prevented from making the decisions which he did on 11 July and 20 August 2008, nor is the Tribunal, on review of those decisions, estopped or otherwise prevented from affirming them in accordance with its findings and the relevant statutory provisions. 55 The Tribunal makes the following orders. 1. The decision made by the Chief Commissioner of State Revenue on 11 July 2008 to reverse his decision to authorise the first home owner grant is affirmed. 2. The decision made by the Chief Commissioner of State Revenue on 20 August 2008 to reverse his decision to approve Ms Hiley's application for the 'First Home Plus' concession is affirmed. 3. The decision made by the Chief Commissioner of State Revenue on 20 August 2008 to reassess stamp duty is affirmed. 4. By consent of the Chief Commissioner of State Revenue, his decision of 20 August 2008 to impose interest on the said stamp duty is set aside and replaced by a decision to impose no interest. 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.