Administrative Decisions Tribunal New South Wales Medium Neutral Citation: Mytilinios v Chief Commissioner for State Revenue (RD) [2011] NSWADTAP 56 Hearing dates: 29 April 2011 Decision date: 06 December 2011 Jurisdiction: Appeal Panel - Internal Before: J Needham SC, Deputy President M Hole, Judicial Member J Schwager, Non-Judicial Member Decision: 1. Appeal dismissed 2. The appellant to pay one half of the costs of the respondent in these proceedings. Catchwords: Land Tax - principal place of residence exemption - whether available while residing elsewhere Legislation Cited: Land Tax Management Act 1956 Administrative Decisions Tribunal Act 1977 Cases Cited: Mytilinios v Chief Commissioner of State Revenue [2010] NSWADT 310 Penrith Leagues Club Ltd v. Commissioner of Land Tax [1983] 2 NSWLR 616; Kidston Goldmines Ltd v. Commissioner of Taxation (1991) 30 FCR 77; Commissioner of Land Tax v. Christie [1973] 2 NSWLR 526; Newcastle City Council v. Newcastle Royal Hospital 1959 Privy Council; Chief Commissioner of State Revenue v. Mesiti [2003] NSW ADTAP 57 Flaracos v. Chief Commissioner of State Revenue [2003] NSWSC 86 Azzopardi v. Tasman UEB Industries Ltd (1985) 4 NSWLR 139 Chief Commissioner of Taxation v. Ferrington [2004] NSW ADTAP 41 Chapman v. Chief Commissioner of State Revenue [2009] NSW ADT 207 Category: Principal judgment Parties: Greg Mytilinios (Applicant) Chief Commissioner of State Revenue (Respondent) Representation: Counsel M Carpenter (Respondent) G Mytilinios (Applicant in person) Crown Solicitors (Respondent) File Number(s): 119002 Decision under appeal Citation: Mytilinios v Chief Commissioner of State Revenue [2010] NSWADT 310 Date of Decision: 2010-12-30 00:00:00 Before: Revenue Division File Number(s): 106009 REASONS FOR DECISION 1Appeal Panel (J. Needham SC, Deputy President; M Hole, Judicial Member; C Bennett, Non-Judicial Member): The appellant, Greg Mytilinios, appeals from a decision of the Judicial Member Perrignon being Mytilinios v Chief Commissioner of State Revenue [2010] NSWADT 310. The decision below affirmed the assessments by the respondent, the Chief Commissioner of State Revenue, that the appellant was liable for land tax for the tax years 2005, 2006, 2007 and 2008 on the basis that the relevant property was not his principal place of residence. 2The appellant appeals from the decision and says that the learned Tribunal member erred by reason of seven questions of law. The Decision Below 3The question for determination by the learned Tribunal member was whether a property at Kogarah Bay was the principal place of residence of the appellant. The determination of the Tribunal was that it was not, and accordingly the principal place of residence exemption was not available. The facts are set out in paragraph 3 of the decision of the Tribunal below and the relevant and cogent fact is that, generally speaking, Mr Mytilinios lived at his parents' home at Kogarah and only occasionally slept at Kogarah Bay. He had previously, and intended in the future, to use and occupy it as his principal place of residence even though he did not currently live there. The issues before the Tribunal were whether the nature of the possession and control of the property exercised by the appellant was sufficient to constitute use and occupation as a principal place of residence and if so, whether any of the exemptions to land tax arising out of Schedule 1A of the Land Tax Management Act 1956 applied. 4The learned Tribunal member made a number of factual determinations commencing at paragraph [6] through to paragraph [22] of the decision. There is no application to extend the appeal to the merits of the Tribunal's decision and so the facts set out in paragraphs 6 to 23 are the facts that the Appeal Panel may use to determine these proceedings. 5It is convenient to deal with each of the seven questions of law raised by the appellant, the submissions of each party, and the determination of each issue in turn. Ground 1 6The appellant referred to a statement in paragraph [43] of the decision where the learned Tribunal member noted that "Mr Mytilinios and his parents were members of the one family". It was contended that clause 12(6) of Schedule 1A which defines "family" meant that this finding was in error. 7It does seem that for the purposes of the land tax legislation the definition of "family" does not include the appellant given that he is not a dependent child or step-child of the persons being his parents. The appellant argued that this error was such that his appeal should be allowed. The respondent argued that despite that finding in paragraph [43] of the decision, the finding that cl 12 of the Schedule did not apply was the correct finding and the error did not have any impact on the decision. 8The Appeal Panel is of the view that Clause 12 does not apply to the appellant's case. Clause 12 provides - 12 Only one principal place of residence for all members of same family (1) For the purposes of the principal place of residence exemption, only one place of residence may be treated as the principal place of residence of all members of the same family. (2) If members of a family own (whether jointly or separately) more than one residence used and occupied by any of them as a principal place of residence, the Chief Commissioner is to treat the one place of residence elected as the principal place of residence of the family as the principal place of residence of all members of the family in respect of a tax year. (3) Such an election is to be made, by or on behalf of the members of the family, in writing and must be lodged with the Chief Commissioner within the period for the lodging of objections under section 89 of the Taxation Administration Act 1996. (4) An election may be made, in respect of a tax year, by the end of the period allowed for the lodging of an objection to a notice of assessment of land tax liability (being an initial assessment of land tax liability) for that tax year. (5) If an election is not made, the Chief Commissioner is to treat the residence that has the highest land value for land tax purposes as the principal place of residence of all members of the family. (6) For the purposes of this clause, a family consists of the following: (a) a person and his or her spouse (if any), (b) any dependent child or dependent step-child of the person and his or her spouse (or of either of them) who ordinarily resides with the person or his or her spouse. (7) A person is the spouse of another person if: (a) they are legally married, or (b) the person is the de facto partner of the other person. (8) However, if the Chief Commissioner is satisfied that a person: (a) is legally married to or is in a registered relationship or an interstate registered relationship, within the meaning of the Relationships Register Act 2010, with another person but not cohabiting with that other person, and (b) has no intention of resuming cohabitation with that other person, the person is not to be regarded as the spouse of that other person and if a dependent child or dependent step-child of the person has a joint interest in the principal place of residence of the spouse, that interest is to be disregarded. (9) A person who is the child or step-child of another person is a dependent child or a dependent step-child if the person is under 18 years of age and is not legally married. (10) Nothing in this clause prevents more than one residence from being treated as the principal place of residence of members of a family under clause 7 (Concession for sale of former principal place of residence). 9The purpose of cl 12 is to provide members of a family with an exemption where one of two or more residences are able to be designated principal places of residence. Sub-cl 2 of Clause 12 requires that any such exemption be given to premises which are "used and occupied by any of [the family] as a principal place of residence". The learned Tribunal member found - and this finding is clearly correct on the evidence - that the appellant did not use and occupy the property as a principal place of residence or indeed as a place of residence at all. He did not live there. The learned Tribunal member, while using the term "family", did not err in finding at 12(6) and 12(9) that it did not apply to the appellant. The use of the term "family" was not an error which led to an incorrect finding of fact or law. Ground 2 10The appellant noted that the learned Tribunal member did not refer to a number of cases cited by him in the proceedings. The cases are - * Penrith Leagues Club Ltd v. Commissioner of Land Tax [1983] 2 NSWLR 616; * Kidston Goldmines Ltd v. Commissioner of Taxation (1991) 30 FCR 77; * Commissioner of Land Tax v. Christie [1973] 2 NSWLR 526; * Newcastle City Council v. Newcastle Royal Hospital 1959 Privy Council; and * Chief Commissioner of State Revenue v. Mesiti [2003] NSW ADTAP 57. 11It is submitted by the appellant that the failure by the respondent to refer to these cases specifically or, he submitted, by necessary implication, shows that his submissions were not properly considered. 12The respondent says that 4 of the 5 cases were referred to in the written submissions, which the decision indicates were clearly read by the learned Tribunal member. There was a specific reference to that in the transcript (see transcripts page 1, lines 1 and 2). The respondent says that the failure by the Tribunal to refer to each and every case does not demonstrate an error of law. 13The Appeal Panel agrees with the respondent that the failure to refer to each and every case does not of itself indicate an error of law. If it were the case that the ultimate decision in the proceedings was made in a way which was contrary to any of these named cases, and the named case had been binding authority, then it may be that an error of law had been committed. However, in the circumstances it is clear from the transcript and the text of the decision itself that the learned Tribunal member read the cases, considered the law relating to this field and, in a learned and thorough decision, dealt with each of the principles raised by the appellant. Accordingly, the Appeal Panel determines that this ground does not constitute an error of law which should result in the original decision being set aside. Ground 3 14The third ground raised by the appellant was whether the finding as to whether his occupation of the property met the definition of principal place of residence was an error. 15We have said above that the finding relating to the principal place of residence was a fact which could not be re-agitated in these proceedings. The question raised by the appellant is whether there was an error of law which arose out of this finding. This is the ground upon which the appellant sought to deal with by reference to the decision in Chief Commissioner of State Revenue v. Mesiti [2003] NSWADT 99. The appellant sought to draw a link between the facts in Mesiti and the factual similarities in his own case. 16The respondent submitted that the finding was not an error, and the application of facts to an objective test is a matter which was a question of fact determined by the Tribunal member. Further, the respondent submitted that the decision was the correct one in that only one residence may be regarded as a principal place of residence and there is no requirement in the legislation that the appellant, or the person in his position, own his principal place of residence. Here, the appellant spent most of his time at his parents' house where he ate and slept during the relevant tax years, and the fact that he did not own the house in which he did those things was not the defining issue in the case of Mesiti . 17The Appeal Panel agrees with the submissions of the respondent. The facts here are not in dispute, and the appellant was clear that he did not live at the property. There does not appear to be any error of law in the way in which the learned Tribunal member applied the tests as to principal place of residence which have been set out in the decisions cited by him in his reasons. The fact that the appellant did not own his parents' place, nor occupied an element of control over it, is not to the point. He, at all relevant times, lived at his parents' house. The only conclusion that can be reached is that the reasons of the Appeal Panel in the determination of this appeal demonstrate that there was no basis of fact or law which would enable the appellant to succeed. Ground 4 18The fourth ground is set out in the Notice of Appeal in terms which state: "The Tribunal has erred in making a finding of fact where there is no evidence to support that finding and misrepresenting the law and the appellant's legal argument". 19The appellant pointed to the manner in which the learned Tribunal member made use of the decision of Gzell J in Flaracos v. Chief Commissioner of State Revenue [2003] NSWSC 86, and took issue with the test applied to determine whether the appellant used and occupied the Kogarah Bay property as a principal place of residence. The appellant referred to the fact that the use and occupation of a principal place of residence does not necessarily cease if the occupation is not continuous. (See Flaracos at [29]). 20The respondent submitted that the learned Tribunal member properly determined the question by - (a)determining primary facts and inferences; (b)identifying and making directions as to relevant law; and (c)application of the relevant law to the facts (see Azzopardi v. Tasman UEB Industries Ltd (1985) 4 NSWLR 139 at 150 per Kirby P. The respondent submitted that the issue of the evidence which was brought in support of that submission would involve reference to questions which are not questions of law. The respondent further submits that there was no error of law for reasons dealt with above, and that this ground should not succeed. 21The Appeal Panel agrees with the respondent on the same basis as in ground 3. Ground 5 22The appeal ground 5 is similar to ground 4 and again to ground 3. The appellant noted that the 4 years in which he lived with his parents was explicable by his father's illness and the fact that he was building a new house. The appellant sought to take issue with the "separating and consequently misinterpreting the facts" of the Tribunal when the Tribunal member examined the relevant years and the level of occupation exercised by the appellant. 23The respondent says that the evidence supports the finding of the Tribunal and that the definition of principal place of residence is an objective assessment to be made in the light of the circumstances relating to the actual occupation of the dwelling ( Chief Commissioner of Taxation v. Ferrington [2004] NSW ADTAP 41 at 42. The respondent points to the paragraphs which in fact refer to the illness of the appellant's father (see paragraphs 12 and 13) and to the construction of the new home (see paragraph 14). 24The Appeal Panel is of the view that there is no error of law arising out of this ground on the basis that the occupation by the appellant was clearly not one of use and occupation as a resident. The Tribunal took into account the relevant facts and appeared to apply those facts properly to the law. The factors raised by the appellant were dealt with by the Tribunal member, and accordingly the appeal cannot succeed on this ground. Ground 6 25The appellant drew attention to paragraph [51] of the decision and asserted that the appellant at all material times intended to build on the land and therefore should be entitled to the exemption for an intended principal place of residence. The appellant noted that the Tribunal found that "in April 2004, Mr Mytilinios decided to demolish and rebuild the Kogarah Bay house and intended to live in when he was ready". The appellant says that this finding entitles him to an exemption under clause 6, sub-clause 4 (a) and (b) on the basis of it being an intended principal place of residence. The appellant further says that the Tribunal did not reflect the legal argument raised by him and failed to apply the concession properly. 26The respondent submitted that there was no error of law and that the Tribunal in fact considered the proper cases such as Chapman v. Chief Commissioner of State Revenue [2009] NSW ADT 207 at paragraphs 122-127 and properly construed those cases. The respondent noted that once the appellant moved back into the property the objection was allowed in respect of the land in that tax year. 27The Appeal Panel agrees that there is no error of law demonstrated. The ground is somewhat confusingly stated by the appellant. The exemption does not apply. Ground 7 28The appellant abandoned ground 7. Conclusion 29The appellant's appeal is such that it depends very significantly on the definition of "principal place of residence" and the fact that the appellant was not able to satisfy the Tribunal that he in fact lived at the property so as to make it his principal place of residence, or even a place of residence at all. In fact there was little room for argument that he did in fact reside elsewhere. The appellant's concerns were that the property was in fact the only property he owned, and that he was subject to building delays through no fault of his own. However, it was common ground that he slept, ate and stayed at another address. The manner in which the words "principal place of residence" has been construed makes it almost impossible for someone who does not in actual fact live at the property to gain the exemption. This reflects the public policy of all land in New South Wales being subject to land tax, save for those to which exemptions apply, and the granting of exemptions to land tax for persons who live in properties as their principal place of residence. 30The appeal must be dismissed. Costs 31The respondent submitted that if the appeal were unsuccessful in the proceedings, then it would be "fair" within the meaning of s 88(1A) of the Administrative Decisions Tribunal Act 1977 to order that the appellant pay the costs of the respondent of the appeal. The relevant sub-section is 88(1A)(3) which allows an order for costs where there is "no tenable basis of fact or law". The respondent submits that there was no question of law in these proceedings and that almost all of the grounds were an inadmissible attempt to re-argue the question of fact determined at the Tribunal level. The appellant argued that he was self-represented and that this was not generally a costs jurisdiction. It would not be fair to make the operation of Section 88(1A) into a "costs follow the event" provision given the basis upon which the Tribunal generally operates, as a no costs jurisdiction. 32It appears to us that this is a case where there was indeed no tenable basis of fact or law. The arguments raised sought to paint the occupation of the appellant's parents' house as a factor which would allow him to claim the exemption in relation to his own property. The decision of the learned Tribunal member was, apart from that one incautious reference to "family", considered, thorough and learned. A person reading the decision would be in no doubt that in order to gain the principal place of residence exemption for the relevant tax years the appellant would have needed to have lived in the property. It must be considered as untenable for the appellant to bring the appeal when it is clear, and indeed admitted, that he did not reside in the property. 33The appellant was, as he says, self-represented. While he did not have the benefit of legal training, the appeal was run relatively effectively and efficiently. He did not seek any unreasonable delays, nor did he engage in any of the matters which go to fairness and unconscionable conduct of proceedings in sub-paragraph 88(1A). 34However as we have said it would be clear to a detached observer that there were no prospects at all of success in these proceedings. We take into account aspects of fairness and give the appellant due credit for his economical running of the Appeal hearing. Accordingly, we order that the appellant pay one half of the costs of the respondent in these proceedings. The notation of one half is on the basis of the error relating to the question of family and the omission of particular cases from the decision. While we do not say at all that these are errors which gave rise to an appellable error, it may be that the appellant felt that these were matters upon which a viable appeal could be based. Whilst he is wrong in the ultimate result, it is perhaps to a lay person understandable that he felt an appeal could be brought on the basis of what he saw as legal errors, and accordingly the costs order against the appellant is limited to one half of the respondent's costs on the ordinary basis. I hereby certify that this is a true and accurate record of the reasons for decision of the Administrative Decisions Tribunal. 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: 06 December 2011