Fenton v Chief Commissioner of State Revenue [2012] NSWADT 96

Administrative Decisions Tribunal New South Wales Medium Neutral Citation: Fenton v Chief Commissioner of State Revenue [2012] NSWADT 96 Hearing dates: 15 May 2012 Decision date: 22 May 2012 Jurisdiction: Revenue Division Before: J. Block, Judicial member Decision: The decision under review is affirmed Catchwords: Principal place of residence - effect of clause 2 (2) of Schedule 1A- consideration of clause 12 of the same schedule Legislation Cited: Land Tax Management Act 1956 Cases Cited: Chief Commissioner of State Revenue v Aldridge & Anor (RD) (2003) NSWADTAP 50; Ghali v Chief Commissioner of State Revenue [2011] NSWADT 261; Chief Commissioner of State Revenue v Mesiti [2003] NSWADTAP 57; Chief Commissioner of State Revenue v Paspaley [2008] NSWCA 184; Aronstan v Chief Commissioner of State Revenue [2008] NSWADT 8; Category: Principal judgment Parties: Michael Fenton (Applicant) Chief Commissioner of State Revenue (Respondent) Representation: R Arnold (Agent, Applicant) Crown Solicitor (Respondent) File Number(s): 116059

REasons for decision

Part A. Preliminary and background 1The decision under review is the disallowance by the Respondent (who is usually referred to in these reasons as "the Chief Commissioner") of an objection by the Applicant against a land tax assessment in respect of the property situated at 12 Central Avenue, Mosman ("the Mosman property") for the 2011 land tax year (and which is usually referred to in these reasons as "the relevant year"). 2The Tribunal had before it the documents lodged pursuant to section 58 of the Administrative Decisions Tribunal Act 1997; it also admitted into evidence exhibits as follows: Exhibit A1; a witness statement by the Applicant dated 23 January 2012; Exhibit R1; a witness statement by Rebecca Kiu (a solicitor in the employ of the Respondent) dated 8 March 2012; Exhibit R2; the first page of a contract dated 6 October 2011 for the sale of the Mosman property by the Applicant to Mr and Mrs Ters; (it may be noted that the Applicant is cited in Exhibit R2 as Michael Fenton of 18 Abbott Road North, Curl Curl). Ex facie that contract the Mosman property was sold for $1, 550,000, 3The Tribunal was furnished with a Statement ("the Statement") of Agreed Facts dated 15 February 2012 signed for on behalf of both parties; its content reads as follows: The parties agree as to the following facts: (1)On 7 August 1996, Michael Fenton became the registered proprietor of the property 12 Central Avenue, Mosman (folio identifier 61/4000) ("the Mosman property"). (2)After 7 August 1996, Michael Fenton lived at the Mosman property as his principal place of residence until on or about 29 November 2011. (3)From 24 April 2009, Michael Fenton and his de facto partner, Louise Anne Hewitt became the registered proprietors of the property 18 Abbott Road, North Curl Curl (folio identifier 24/1/5748) ("the Curl Curl property"). (4)After April 2010, Louise Anne Hewitt lived at the Curl Curl property as her principal place of residence. (5)Prior to April 2010, Michael Fenton lived at the Mosman property, as his principal place of residence. (6)From April 2010 to March 2011, Michael Fenton lived at the Curl Curl property 80% of the time and at the Mosman property 20% of the time. (7)Michael Fenton had moved into the Curl Curl property to assist with the renovation of the property. (8)From March 2011, after the completion of the renovation of the Curl Curl property, Michael Fenton lived at the Mosman property 90% of the time and at the Curl Curl property 10% of the time. 4It is relevant to note that at the commencement of the hearing Mr Gerard, on behalf of the Chief Commissioner, contended that the Statement contains an error in clause 2 in that it (erroneously) states that the Applicant lived in the Mosman property as his principal place of residence ("PPR") until November 2011. That that statement was inadvertently made is demonstrated by other parts of the Statement and in particular clause 5. Mr Arnold did not contradict Mr. Gerard's assertion that clause 2 as contained in the Statement was erroneous or that the Chief Commissioner was in any way precluded or stopped from referring to the true facts. That there is a dispute of fact between the parties is clear from the evidence and including without limitation the section 58 documents and Exhibit A1. The Respondent contends that the Mosman property was not the Applicant's PPR in respect of the relevant year. The Applicant in his objection against the assessment contended that each of the Mosman property and the Curl Curl property qualified as his PPR; in his letter dated 25 February 2011 attached to his objection he stated: "In reference to my 2011 Land Tax Assessment I have received advice that both 12 Central Avenue Mosman and 18 Abbott Road North Curl Curl qualify as my principal place of residence. I spend time at both addresses as my de facto wife lives at 18 Abbott Road and my dependent son is resident at 12 Central Avenue Mosman. I am advised that I am at liberty to nominate which of these addresses be exempt for land tax purposes and therefore nominate 12 Central Avenue Mosman." At the hearing and in his submissions Mr Arnold contended that clause 12 of Schedule 1A to the Land Tax Management Act 1956 ("the LT Act" or "the Act") operated in such manner that in relation to the Mosman property and the Curl Curl property (and in respect of both of which the Applicant was the or an owner) so as to allow a right of election to the Applicant to select which of the two was his PPR and in the absence of an election (and there was in fact no election prior to that set out in the letter dated 25 February 2011 quoted above) that clause defaulted so that the PPR exemption was to be allowed in respect of the more valuable property and which was the Mosman property. I will revert to clause 12 of Schedule 1A in more detail later in these reasons. 5The Chief Commissioner furnished the Tribunal with lengthy and helpful written submissions and dealing with both fact and law. In respect of its content under the head of "Introduction and Background" the Tribunal includes clauses 4 to 16 (excluding footnotes which cross reference its content to either Exhibit A1 or the Statement) as follows: 4. The applicant first moved to Central Avenue Mosman in 1984. The applicant, along with his first wife, purchased 28 Central Avenue, Mosman. 5. Following the breakdown of that marriage, in 1996, the applicant purchased the Mosman property in order to be as near as possible to his young children. At or around that time 28 Central Avenue, Mosman, was signed over to the applicant's first wife as part of the separation agreement. 6. The applicant then lived at the Mosman property, with his young children staying with him 5 nights each school fortnight and half of the time during holiday periods. 7. During the 1980's the applicant's parent's moved to Australia from England. The applicant's parents decided on purchasing 18 Abbott Road, North Curl Curl ("the Curl Curl property") but as they could not afford that property alone the applicant supplied 1/3 of the purchase price of the Curl Curl property and became a 1/3 owner. 8. Following the death of the applicant's father in 1999, the applicant's mother returned to England. The applicant purchased the remaining 2/3 share of the Curl Curl property from his mother in aid of that move. The applicant rented the Curl Curl property out and paid land tax on it when liable. 9 At some point in the 1990's the applicant purchased a further property located in Griffin Road at North Curl Curl ("Griffin Road property"). The applicant commenced paying land tax on the Curl Curl property and the Griffin Road property. 10. In March 2009, the applicant sold a half share in the Curl Curl property to his de facto/girlfriend Louise Hewitt. 11. Apparently some decision was subsequently made to renovate the Curl Curl property. Ms Hewitt took the lead role in the organising of the redevelopment of the Curl Curl property. Re-development work commenced in September 2009 and the Curl Curl house was apparently habitable in April 2010. 12. It was at this time the applicant "started to get more involved in the 'finishings' of the redeveloped property" and began to spend more time at the Curl Curl property. 13. Accordingly, between April 2010 and March 2011 the applicant estimates that he spent 80% of his time residing at Curl Curl and 20% of his time residing at Mosman. 14. Between 4 June 2003 and 26 March 2010, Ms Louise Hewitt's listed drivers licence address was the Mosman property. On 26 March 2010, Ms Hewitt changed her listed drivers licence address to the Curl Curl property. 15. Between 24 July 2008 and 2 February 2010, Ms Louise Hewitt's listed electoral roll address was the Mosman property. On 16 June 2010, Ms Hewitt changed her listed electoral roll address to the Curl Curl property. 16. Throughout the relevant period the applicant's mailing address was the Mosman property.