Supreme Court New South Wales Medium Neutral Citation: Navazi v New South Wales Land & Housing Corporation [2013] NSWSC 138 Hearing dates: 27/11/2012, 11/12/2012 Decision date: 01 March 2013 Jurisdiction: Common Law Before: Rothman J Decision: Plaintiff to file short minutes to give effect to the quashing of the decision challenged. Catchwords: ADMINISTRATIVE LAW - Housing Act - decision to cancel housing rebate - requirements of investigation under s 58 - conduct of s 58 investigation a jurisdictional fact in decision to cancel rebate - requirement to consider and investigate weekly income - jurisdictional precondition not satisfied - orders granted Legislation Cited: Housing Act 2001 Cases Cited: Corporation of the City of Enfield v Development Assessment Commission [2000] HCA 5; (2000) 199 CLR 135 Federal Commissioner of Taxation v Myer Emporium Ltd [1987] HCA 18; (1987) 163 CLR 199 Gedeon v Commissioner of the NSW Crime Commission [2008] HCA 43; (2008) 236 CLR 120 Minister for Aboriginal Affairs v Peko-Wallsend Ltd [1986] HCA 40; (1986) 162 CLR 24 Parisienne Basket Shoes Pty Ltd v Whyte [1938] HCA 7; (1938) 59 CLR 369 Project Blue Sky v Australian Broadcasting Authority [1998] HCA 28; (1998) 194 CLR 355 Ronpibon Tin NL & Tongkah Compound NL v Federal Commissioner of Taxation [1949] HCA 15; (1949) 78 CLR 47 Timbarra Protection Coalition Inc v Ross Mining NL & Ors [1999] NSWCA 8; (1999) 46 NSWLR 55 Category: Principal judgment Parties: Ali Navazi (also known as Nowronzali Navazihakani) (Plaintiff) New South Wales Land & Housing Corporation (Defendant) Representation: Counsel: G Johnson SC/P Bambagiotti (Plaintiff) J Smith/V McWilliam (Defendant) Solicitors: Salvos Legal Humanitarian (Plaintiff) Housing NSW (Defendant) File Number(s): 2012/00201252 Judgment 1The plaintiff, Ali Navazi (also known as Nowronzali Navazihakani), seeks orders against the New South Wales Land & Housing Corporation (hereinafter, "the Corporation") challenging its decision cancelling the housing subsidy previously granted to Mr Navazi. The summons seeks certiorari, prohibition and declarations in relation to both the decision to cancel the plaintiff's rebate made on or about 24 February 2010 and the decision to endorse the cancellation made on a review on or about 31 August 2010. 2The proceedings are "traditional" judicial review proceedings alleging jurisdictional error, or error of law, in the making of the decision. 3The grounds upon which Mr Navazi claims relief challenge the cancellation decision because a condition precedent (jurisdictional fact) upon which the decision depends is the conduct of an investigation determining the weekly income of the plaintiff under s 58 of the Housing Act 2001. 4The decision to cancel the rebate (hereinafter "the decision") was reportedly made under s 57 of the Housing Act. It is said that the two investigators: were not appointed to inquire pursuant to the appropriate section; were not delegated in accordance with the provisions of the Housing Act to undertake the investigation; and did not conduct an investigation into the matters required by s 58 of the Housing Act. 5Secondly, and possibly primarily, the cancellation decision is challenged on the basis that it failed to take into account a relevant mandatory consideration, namely, the net weekly income of Mr Navazi. 6A third ground of challenge to the purported cancellation decision is error of law by the decision maker in that the decision maker took the view, wrongly, that the ownership of property, simpliciter, was a disqualifying fact in relation to a housing rebate. 7Lastly, in relation to the cancellation decision, it is challenged on the basis that the power to make the decision was not delegated validly to the person who made it. 8In relation to the internal review, it is challenged on the same bases as the cancellation decision, namely: the absence of an investigation under s 58 of the Housing Act; the failure to take into account a relevant mandatory consideration, namely, the net weekly income of the plaintiff; error of law in treating ownership of property, jointly or otherwise, as a fact that disqualifies a person from eligibility for a rebate; and a further ground, namely, that the decision maker did not consider whether the plaintiff was legally able to use the property owned as a viable alternative to public housing by reason, inter alia, of his disability. 9The facts are generally uncontroversial and in relatively short compass. Facts 10Mr Navazi became a tenant of the Corporation on or about 16 October 1995. He was granted a rental subsidy by the Corporation which rebate continued up until the cancellation decision that is the subject of these proceedings. 11The rebate, broadly, works in the following way. Market rent is charged by the Corporation to its tenants and, depending upon a decision as to the level of rebate, the market rent is reduced by that amount. The rebate is determined under s 56 of the Housing Act. 12Mr Navazi suffers a number of disabilities. He suffers paraplegia (is confined to a wheelchair) and respiratory conditions for which he requires a ventilating device and oxygen machine. He also suffers depression. He lives on a disability support benefit. 13Mr Navazi leases a residence from the Corporation which has been adapted specifically to suit his disabilities. He requires accommodation of that kind. Mr Navazi is the registered proprietor of a property, obviously not the premises in which he is accommodated. The circumstances of that ownership are controversial and it is not appropriate for the Court to resolve that controversy, given the absence of evidence in relation to the issues. It is sufficient for present purposes to explain the controversy. 14Mr Navazi maintains that the property was purchased for his sister in Iran, who had proposed to come to Australia to live and that their arrangement was that she was entitled to any equity in, or income from, those properties. The property is registered with Mr Navazi as a tenant in common with a third party, not his sister. Mr Navazi alleges that he holds his interest in the property as trustee for his sister. The nature of his interest in the property is not conceded by the Corporation. 15It is accepted by both parties that the property in question (namely the present property and any former properties) was leased on the market and rent was paid. There is a mortgage registered on the property. Mr Navazi claims (and I accept, at least for present purposes) that there were outgoings in relation to the property, including mortgage payments and he also claims (upon which I make no finding) that the property did not net for him any weekly income. 16The evidence before the Court, which is uncontested, is that any and all properties that have been owned by Mr Navazi, in whatever interest, were not suitable for his accommodation because of his disabilities and the access restrictions to those properties. 17There are currently unrelated proceedings in the District Court in which the Corporation is seeking the payment of rent due, being a debt which includes rent that has not been the subject of the rebate. Those proceedings are temporarily stayed pending the outcome of these proceedings and the determination of whether the cancellation of the rebate was valid. 18From the little that has been put to the Court in these proceedings, it seems that the proceedings in the District Court are an appeal from the Consumer, Trader & Tenancy Tribunal (hereinafter, "CTTT") dealing with the debt and, it seems, a notice of termination of the tenancy. It is neither appropriate nor necessary for this Court to comment further. Those are matters for the District Court and/or the Tribunal. 19On 3 February 2009, the Corporation's Tenancy Fraud Unit commenced an investigation into Mr Navazi's rental subsidy. It seems this followed upon a complaint by a former tenant of one of the properties for which Mr Navazi was the registered proprietor. 20On 14 August 2009, a facsimile was sent by the Corporation to the Commissioner of Fair Trading requesting information on two properties: 3/18 Grafton Crescent, Dee Why and 33 Old Pittwater Road, Brookvale. 21The letter (Annexure A to the Affidavit of Alison Morgan of 9 November 2012) refers to the requirement on tenants of the Corporation to notify changes to their circumstances pursuant to s 69 and s 69A of the Housing Act. It alleges illegality in the contravention of those provisions, but does not, at this stage, allege illegality by Mr Navazi. 22The letter also states that the Corporation "is authorised to undertake an investigation of these matters, pursuant to s 58 of the Housing Act". It seeks the assistance of the Commissioner of Fair Trading as to records of rental of the two properties earlier mentioned. That letter was sent over the signature of Alison Morgan, the deponent, described as the Acting Manger, Tenant Fraud Unit of the Corporation. 23In response to the facsimile of 14 August 2009, the Office of Fair Trading notified Ms Morgan of the receipt of rental bonds in relation to 3/18 Grafton Crescent, Dee Why, but not in relation to the Brookvale property. That occurred on 21 August 2009. 24After some further correspondence, on 27 October 2009, the Office of Fair Trading again corresponded with Ms Morgan and notified her of rental bond having been lodged in relation to the Brookvale property on 2 August 2000 in the name of one lessee that was refunded in March 2004, a further bond lodged on 4 May 2006 and refunded on 17 August of that year and a third bond lodged on 18 August 2006 and refunded on 13 July 2009. On its face that correspondence is evidence in the hands of the Corporation that the property about which an enquiry was made was rented. 25On 9 December 2009, Ms Morgan wrote to the Registrar, NSW Registry of Births, Deaths & Marriages seeking evidence of the change of name of Mr Navazi from Mr Navazihakani. No formal change of name had been registered. 26For the purpose of these investigations, Ms Morgan first wrote to Mr Navazi on 26 October 2009. In that letter (Annexure F, Affidavit of Ms Morgan of 9 November 2012), Ms Morgan said: "Housing NSW is currently undertaking an investigation related to your tenancy at 35 Old Pittwater Road, Brookvale. The investigation concerns alleged breaches of Sections 69 and 69A of the Housing Act. If these matters are proved you may have been receiving a housing benefit to which you are not entitled. Persons in receipt of a housing benefit are required to notify Housing NSW within 28 days of changes to their circumstances, pursuant to Sections 69 and 69A of the Housing Act 2001 (NSW). It is therefore illegal to contravene these provisions and if proved, may result in serious and/or criminal sanctions being imposed. This could include up to 3 months in gaol and a fine of up to $2,200. Housing NSW is authorised to undertake an investigation of these matters, pursuant to Section 58 of the Housing Act 2001 (NSW). Specifically the investigation concerns the following issues: 1. That you failed to notify Housing NSW that you had jointly purchased property (Lot 3/SP1214) at 3/18 Grafton Crescent, Dee Why in June 2003, and that this property was sold in January 2008. 2. That you failed to notify Housing NSW that you received rental income from the property at 3/18 Grafton Crescent, Dee Why between June 2003 and January 2008. 3. That you failed to notify Housing NSW that you had jointly purchased property (Lot 37/35184) at 33 Old Pittwater Road, Brookvale in January 2004. 4. That you failed to notify Housing NSW that you have received rental income from the property at 33 Old Pittwater Road, Brookvale since January 2004. 5. That you signed Application for Rental Subsidy forms on the 8th October 2004, 8th June 2006 and 11th May 2007 in which you falsely ticked the 'no' box to question number 7 that asks Do you, your spouse, or anyone in this application own or part own any property including a house, unit, land or commercial property? Before this matter is progressed any further I would like to offer you the opportunity of coming in to our office at Unit 17A/18 Ground Floor, 818 Pittwater Road, Dee Why for an interview." 27The letter went on to inform Mr Navazi that he would have, at that interview, an opportunity to provide relevant information but that he was not required to attend and could preserve his "right to silence". No other aspects are currently relevant. 28On 17 November 2009, Ms Morgan wrote, once more, to Mr Navazi, the relevant parts of which repeated all but the first paragraph of the letter of 26 October 2009 extracted above. 29On 1 December 2009, Ms Morgan sent another letter to Mr Navazi, the relevant parts of which include: "At this stage we have evidence that indicates that you have failed to notify Housing NSW that you have jointly owned properties in Brookvale and Dee Why since June 2003, and that you have been receiving rental income from these properties. Without evidence from you to refute these allegations Housing NSW will cancel the rental rebates you have received since this time. This will result in a significant debt being placed upon rental account (approximately $90,000). This action is also likely to result in the termination of your tenancy, and could also result in a criminal prosecution against you for breaches of Section 69 of the Housing Act 2001. Before this matter is progressed any further I would again like to offer you the opportunity of coming in to our office in Dee Why, Ashfield or Sussex Street in the City for an interview. Each of these offices is accessible for wheelchairs. This interview will allow you the opportunity to provide any relevant information about this matter." (Annexure H, Affidavit of Ms Morgan of 9 November 2012) 30The letter of 1 December 2009 also informed Mr Navazi that, should he wish to attend the interview that was offered, he would be welcome to bring a solicitor or friend and of certain organisations that may be able to give him advice, including the Tenant's Advisory Service, the Tenants Union of NSW and other organisations. 31On 7 January 2010, Mr Jonathan Paniagua of the Northern Area Tenant's Service contacted Ms Morgan on behalf of Mr Navazi seeking to discuss the matter. The foregoing letters were forwarded to Mr Paniagua. 32On 12 February 2010, Ms Morgan wrote to Mr Perret, the Acting Area Director of the Northern Suburbs setting out recommendations in relation to Mr Navazi. While the entirety of the report is relevant I extract the most relevant aspects: "The Tenant Fraud Unit has been investigating a matter of undeclared property ownership against the tenant Nowronzali NAVAZIHAKANI. My final investigation report is attached for your information. I am now recommending that: 1. Mr Navazihakani immediately have his rental subsidy cancelled and he pay market rent. 2. Mr Navazihakani's rental subsidies be cancelled back to the date he purchased the first property, 23 June 2003. The ensuing debt should be coded as FRAUD. 3. Action be taken in the CTTT to end the tenancy. 4. Reasonable time is provided to Mr Navazihakani to arrange suitable alternative accommodation in light of his health issues and the fact that he needs accommodation that is accessible for his wheel chair. As you will see from the report, Mr Navazihakani has been offered a number of opportunities to attend an interview to discuss this matter. He has now retained Legal Counsel and has declined to speak with the TFU at all about the matter. The matter has also been referred to Legal Services Branch for them to pursue criminal action against Mr Navazihakani and to consider an action under Sect 72B to place a statutory charge on the property owned by Mr Navazihakani in order to recover the debt owed to HNSW. In order for this to happen the debt will first need to be raised on his account." 33The final investigation report recites a range of information which it is unnecessary to repeat but, in summary, it asserted: a failure by Mr Navazi to notify the Corporation that he had jointly purchased property at Dee Why; likewise, a failure to notify the Corporation of property purchased at Brookvale; a failure to notify the Corporation that he had received rental income from the property at Brookvale; a failure to notify the Corporation that he had received rental income from the property at Dee Why; and that Mr Navazi had signed an applications for rental subsidy on 8 October 2004, 8 June 2006 and 11 May 2007 in which he had asserted (by ticking a relevant box) that he did not own or part-own any property including a house, unit, land or commercial property. 34The report summarised the investigation and recommended actions in the following terms: "Recommended actions - Client Service Team: 1. It is recommended that Mr Navazihakani immediately have his rental subsidy cancelled and he return to paying market rent. 2. It is recommended that Mr Navazihakani's rental subsidies be cancelled back to the date he purchased the first property 23 June 2003. 3. Action be taken in the CTTT to end the tenancy. 4. Reasonable time is provided to Mr Navazihakani to arrange suitable alternative accommodation in light of his health issues and the fact that he needs accommodation that is accessible for his wheel chair. Recommended actions - Legal Services Branch: 1. Consideration be given to referring the matter to the DPP for prosecution under the Crimes Act owing to the length of time the fraud has continued (almost 7 years) and the quantum of the fraud (estimate approximately $90,000). 2. If this is not possible, action be taken to charge Mr Navazihakani under Sect 69(2) for the previous six months of rental subsidies fraudulently claimed. 3. Action be taken under Section 72B to place a registration of debt on the property (Lot 37/35184) at 33 Old Pittwater Road, Brookvale, to ensure HNSW can recover the debt owed." 35On 18 February 2009, a briefing note was prepared by Ms Lummis and forwarded, I infer, to Mr Perret. The briefing note reiterates a number of conclusions available from material already recited above; other personal information relating to Mr Navazi; the current position in terms of Mr Navazi's rental subsidy; and the amount that, if cancellation of the subsidy occurred, he would be in debt. The recommendation made by Ms Lummis was in the following terms: "The General manager, Central Sydney Division, approve the cancellation of Mr [Navazi's] rental subsidies and subsequent action to end his tenancy in the CTTT." 36The foregoing recommendation, according to the document before the Court, was approved by Mr Perret, Acting Area Director, Northern Suburbs, on 18 February 2009 and forwarded to Ms Kathy Roil, General Manager, Central Sydney Division. 37The recommendation notes, in typewritten form, the following: "Cancellation of subsidy approved. Please ensure appropriate notification is made to the tenant regarding this course of action so that he understands that this will happen and what this will mean for his arrears. Kathy Roil General Manager Central Sydney Division [Kathy Roil's signature] APPROVED" 38On 29 March 2010, the Corporation, under the signature of Ms Morgan, wrote to Mr Navazi informing him, relevantly, that Ms Morgan had recommended to the Area Director that Mr Navazi's rental subsidy be cancelled as he "currently [does] not meet the eligibility requirements (as [he is] a joint owner of property)", and that "[his] rental subsidy be retrospectively cancelled from June 2003 (the date on which [he] first purchased property)." Ms Morgan informed Mr Navazi that an investigation was underway. A fact, Ms Morgan said, of which Mr Navazi was aware. Ms Morgan asserted that the "investigation concerns alleged breaches of sections 69 and 69A of the Housing Act". 39The letter also informed Mr Navazi that the recommendations made to the Area Director had been accepted and the action approved and that his rental subsidy had been cancelled. It informed Mr Navazi that he had a right to appeal the decision. The letter also informed Mr Navazi that the Tenant Fraud Unit of the Corporation was seeking further advice concerning a prosecution for breaches of s 69 and s 69A of the Housing Act. The letter attached a pro-forma document relating to appeals and an application for appeal. 40On 6 April 2010, the Corporation wrote to Mr Navazi seeking vacant possession of the premises that he was then renting. 41On 12 April 2010, Mr Navazi's local member, Mr Brad Hazzard, Liberal Member for Wakehurst, wrote to the Corporation seeking clarification of what had occurred. In the response to that letter addressed to Mr Hazzard's Assistant, Ms Morgan stated: "HNSW has investigated [Mr Navazi] regarding his property ownership. He currently owns one property jointly with another person and has owned property (at one stage they owned two properties) for approximately 9 years. Under HNSW policies tenants who own property are not entitled to receive a rental rebate. These properties have been let on the private rental market and Mr [Navazi] has never declared the income form [sic] these properties. Mr [Navazi] has been offered a number of opportunities (since November 2009) to come in and discuss this issue with me but has sought legal advice and has declined to be interviewed. Accordingly his rental rebate has been cancelled ..." 42Shortly after the correspondence of 12 April 2010, namely, on 14 April 2010, Mr Navazi contacted Ms Morgan by telephone. Presumably this was occasioned by the advice from Mr Hazzard's office as to the willingness of the Corporation or its officers to speak with Mr Navazi. A record of that conversation is Annexure R to the Affidavit of Ms Morgan of 9 November 2012. The record of interview is most relevantly in the following terms: "AM explained that his name is on title documents for property and so he in [sic] not entitled to a rental rebate. NN says it is his sister's property. She lives overseas and she gave him the money to buy the property. He says it is not his. He cannot steal it from his sister. His sister helps him with money when he needs extra for his doctors because Centrelink does not give him enough money and when she asked him to buy a property for her he said yes but he does not own it. Because she lives overseas he says that she cannot have her name on the title. NN says that the other person who owns the property is a friend. AM explained that when he has filled in subsidy renewal forms he has ticked 'no' to owning property and this is false information and this is a serious matter. NN says that he ticked 'no' because he does not own o tot [sic] is his sister's. AM explained that his name was on the title documents and so legally he owns it. He can decide to sell it and he can use the money to look after his own housing needs." 43The expression of opinion of Ms Morgan was reiterated to the Legal Aid Commission, acting on behalf of Mr Navazi (by letter dated 16 April 2010), in which they were informed that Mr Navazi's rental rebate had been cancelled because of property ownership and that under the Corporation's policy a person who owns (or jointly owns) property that is habitable is not entitled to receive a rental rebate. They were also informed that the Corporation was still considering the possibility of a criminal prosecution. (Annexure S, Affidavit of Ms Morgan of 9 November 2012.) 44On 29 April 2010, Ms Morgan, once more, wrote to Mr Navazi explaining to him that he was currently being charged the full rent for the property leased from the Corporation and that "because [he is] a joint owner of property ... [he is] not eligible to receive a rental subsidy". Ms Morgan attached the policy that was said to give rise to that conclusion. The letter also confirmed that Mr Navazi asserted that the property at Brookvale was owned on behalf of his sister who lives in Iran. It recites that the title documents and mortgage are in Mr Navazi's name and that Mr Navazi was claiming that the money to purchase his share in the property came from his sister; the income earned from renting the property went wholly into the mortgage; and that he did not consider the property to be his. 45In the letter of 29 April 2010 (Annexure V, Affidavit of Ms Morgan of 9 November 2012), Ms Morgan informed Mr Navazi that he was required to prove the assertions he had made and to prove that he had no legal rights to the property or the equity in it, and therefore cannot use it to meet his own housing needs. Ms Morgan required that evidence to be forwarded by 28 May 2010. 46On 28 May 2010, Mr Navazi was interviewed for the purpose of the appeal against the decision to cancel his rebate. The Corporation had received the appeal on 10 May 2010. Oddly, on 21 May 2010, the Reviewing Officer, Ms Victoria Harvey, Appeal Coordinator, dismissed the appeal (Affidavit of Ms Morgan of 9 November 2012) because Mr Navazi continued to have property that could be used to accommodate himself and his family. The appeal may not have been determined until 27 August 2010 (Affidavit of Ms Morgan of 9 November 2012, page 122). Legislation, Delegation Instruments and Policy Documents 47The Housing Act, as is common, sets out objects. Those objects are set out in s 5 of the Act and include: maximising of opportunities for all people in New South Wales to have access to secure, appropriate and affordable housing; ensuring that housing opportunities and assistance are available to all sections of the community with housing needs; ensuring that the public housing system focuses on housing people who are most in need; ensuring that the available supply of public housing is shared equitably among people who are most in need; and other similar objects. 48By subsection 5(2) of the Housing Act, the legislation requires that in the administration of the Statute regard "is to be had to the objects ... to the maximum extent possible". 49The other most relevant provisions are those contained in ss 6, 7, 15, 54, 55, 56, 57, 58, 69 and 69A of the Housing Act. They are in the following terms: "6 Establishment of New South Wales Land and Housing Corporation (1) There is constituted by this Act a body corporate with the corporate name of the New South Wales Land and Housing Corporation. (2) The affairs of the Corporation are to be managed by the Director-General. (3) Any act, matter or thing done in the name of, or on behalf of, the Corporation by the Director-General, or with the authority of the Director-General, is taken to have been done by the Corporation. (4) The Corporation is, for the purposes of any Act, a statutory body representing the Crown. (5) The Corporation is subject to the direction and control of the Minister. (7) The Corporation may exercise any of its functions, and may otherwise act, in the name of the Department. (8) The Corporation and the Department are, to the maximum extent possible, to act in a complementary manner, so as to achieve a unified administration of this Act. 7 Functions of Corporation generally (1) The Corporation: (a) has the functions conferred on it by or under this or any other Act and may do such supplemental, incidental and consequential acts as may be necessary or expedient for the exercise of its functions, and (b) has such other functions as are necessary to implement any Commonwealth State agreement, in so far as it relates to housing. (2) The Corporation is to manage financial risks associated with its activities. (3) The Corporation cannot employ any staff. ... 15 Delegations (1) The Corporation may delegate to a person the exercise of any of its functions, other than this power of delegation. (1A) A delegate of the Corporation may sub-delegate to a person any function delegated by the Corporation if the delegate is authorised to do so by the Corporation. (2) The Director-General may delegate to an officer of the Department, or to the Corporation, the exercise of any of the Director-General's functions under this Act (including any function delegated to the Director-General under this section), other than this power of delegation. (2A) A delegate of the Director-General may sub-delegate to an officer of the Department any function delegated by the Director-General if the delegate is authorised to do so by the Director-General. (3) The Registrar may delegate to an officer of the Department, or to the Corporation, the exercise of any of the Registrar's functions under this Act (including any function delegated to the Registrar under this section), other than this power of delegation. ... 54 Application of Part This Part applies to tenants: (a) who are renting public housing, or ... 55 Application for rental rebate A tenant to whom this Part applies may make an application to the Corporation in a form approved by the Corporation for a weekly rebate of rental. 56 Grant of rental rebate (1) The Corporation may, after making an investigation under section 58, grant to an applicant a weekly rebate of rental. (2) The amount of rebate is to be determined by the Corporation in accordance with guidelines approved by the Minister. 57 Cancellation or variation of rental rebate (1) The Corporation may, after conducting an investigation under section 58, vary or cancel any rental rebate granted under this Part. (2) The Corporation is to determine the date (being a date occurring before, on or after the making of the determination) on which the variation or cancellation has effect or is taken to have effect. [Subsections 57(3), (4) and (5) deal with the requirement on the Corporation to give notice of any variation or cancellation, the date upon which such variation or cancellation is to take effect (or has taken effect) any requirement to reimburse rental rebate already granted and the method by which the Corporation may recover unpaid or unreimbursed rental rebate as a debt.] 58 Investigation of application (1) The Corporation may make an investigation to determine the weekly income of: (a) a person who is an applicant for, or a recipient of, a rental rebate under this Part, and (b) any other resident of the house in which that person resides. (2) The Corporation may require a person who is an applicant for, or a recipient of, a rental rebate under this Part to produce such evidence as the Corporation thinks fit of the person's weekly income and of the weekly income of any other resident of the house in which that person resides. ... 69 False statements and representations (1) A person must not wilfully make any false statement or representation: (a) to obtain or claim from the Corporation accommodation or a rental rebate, or any other advantage or concession, or (b) to deceive any officer or employee of the Corporation in relation to obtaining accommodation or a rental rebate, or any other advantage or concession from the Corporation, or (c) to affect the rate or amount of any rental rebate from the Corporation. Maximum penalty: 3 months imprisonment or 20 penalty units, or both. (2) A person must not by means of personation or any other fraudulent device obtain or claim from the Corporation accommodation or any rental rebate or any other advantage or concession. Maximum penalty: 3 months imprisonment or 20 penalty units, or both. (3) A person: (a) who causes the commission of an offence against this section, or (b) by whose order or direction such an offence is committed, or (c) who aids, abets, counsels or procures or by act or omission is directly or indirectly concerned in the commission of such an offence, is guilty in the same degree and liable to the same penalty as the principal offender. 69A Failure to notify of change of circumstances (1) A person must not, with the intention of retaining or continuing to obtain a benefit to which the person knows that he or she is not entitled, fail to notify the Corporation of any relevant change of circumstances within the time specified in subsection (2). Maximum penalty: 3 months imprisonment or 20 penalty units, or both. (2) The Corporation must be notified under subsection (1) within 28 days after the person first becomes aware of the relevant change of circumstances. (3) In this section: 'benefit' means any accommodation, rental rebate or any other advantage or concession from the Corporation. 'relevant change of circumstances' means a change in the person's circumstances that will remove or reduce the person's entitlement to a benefit." 50Purportedly pursuant to the provisions of s 15 of the Housing Act, instruments of delegation and sub-delegation were issued. By instrument dated 27 May 2009, and signed by David Borger as Minister for Housing NSW, a Formal Instrument of Financial Delegation to Exercise Functions issued purporting to delegate the function of approving cancellation of rebate subsidy (with the qualification that the delegation was for a cancellation of up to six months) to the designated positions of Senior Client Service Officer, Team Leader and Housing Manager (Exhibit A). 51On 23 March 2009, the Director-General approved certain administrative, human resources and financial delegations on the recommendation of the Acting Director, Legal Services, the Director, Governance and Regulation and the Executive Director, Business Management and Governance (Exhibit E). The effect of that delegation was again to delegate the approval of a cancellation of rebate subsidy for up to six months to a Senior Client Service Officer, Team Leader and Housing Manager. The terms of the delegation (by Mike Allen as Director-General of Housing NSW for and on behalf of Housing NSW and the NSW Land and Housing Corporation) make clear that the delegation to such a person includes a delegation to any person holding that position, or in the administrative reporting line above the position to which reference has been made, in the same manner as they are authorised to be exercised by the officers specified. 52By Instrument of Delegation (Exhibit F) issued on 24 September 2009, the Director-General, Department of Human Services on behalf of NSW Land and Housing Corporation purported to delegate to the Chief Executive, Housing NSW, Department of Human Services all of the functions of NSW Land and Housing Corporation under the Housing Act. It is appropriate that I set out the precise terms of that delegation: "To the extent that I am able, I Jennifer Mason Director-General Department of Human Services, on behalf of NSW Land and Housing Corporation with power to delegate under s 15(1) of the Housing Act 2001, delegate the exercise and performance of those functions, authorities, duties and powers in Schedule 1 to the person identified in that Schedule. Each delegation is subject to the conditions that: (i) It will be exercised subject to such administrative instructions as the Director-General may give from time to time. (ii) Any matter which involves a substantial departure from policy shall be submitted for consideration to the Director-General. (iii) It shall be exercised in accordance with such duties as may be assigned from time to time pursuant to the Public Sector Employment and Management Act 2002 to the delegate. The delegate may sub-delegate. ... This Instrument takes effect from 24 September 2009." 53The officer specified in Exhibit F, recited above, is confined to one position, namely, Chief Executive, Housing NSW, Department of Human Services and the power/function delegated is described as "all of the functions of the NSW Land and Housing Corporation under the Housing Act 2001". 54Lastly, in relation to the documents upon which the parties have relied in seeking to agitate their submissions, I recite the policy of the Corporation said to apply to the grant and cancellation of a rebate. Exhibit 2 in these proceedings is part of Exhibit NC2 to the affidavit of Nathan Cureton affirmed 31 August 2012. Under that document a number of policy announcements are recorded. While the whole of the document is relevant, the most relevant sections are extracted below: "What is a Rent Subsidy? Many people who live in a Housing NSW home cannot afford to pay the full amount of the market rent and may apply to Housing NSW for help to pay some of the market rent. The portion of the market rent that Housing NSW pays on your behalf is called a rent subsidy. Households receiving a rent subsidy pay a percentage of their income as rent. The rent subsidy is not paid to you but is deducted from the market rent. The portion you pay is called the rent payable or net rent. Your rent payable is calculated according to your household's size, type and gross assessable income. For example: Market Rent - Rent Subsidy = the Rent Payable ... Income for Self-Employed Clients The income of self-employed clients is calculated by taking the gross income less legitimate business deductions. Legitimate business expenses are classed as any expense essential for producing an income. Some items may be allowable as tax deductions, but we do not consider them to be legitimate business expenses. ... Tenants who own or have a Share in Real Estate If a tenant (or their partner) owns or has a share in a property that could provide a viable alternative to public housing or a SAS tenancy they will not get a rent subsidy. Housing NSW expects them to live in that property or to sell the equity in the property to meet their housing needs. If a tenant or their partner is leasing the property to another person they are not eligible for a rent subsidy (irrespective of the rent earned). Any income generated by the property will be treated as non-statutory income in cases where the tenant or their partner only has a part share in the property. In this circumstance Housing NSW will only assess the part share of property income. Housing NSW may not consider the property, its value or any income generated by it for the subsidy assessment where the property is: in an isolated location an extremely run-down dwelling overseas tied up in a legal dispute and income cannot be generated from it If another household member owns or has a partial share in a property in Australia, Housing NSW will treat this as an asset unless an income is derived from the property. The tenant may receive a rent subsidy and the value of the property is included in assessment of the household's income and assets. Where a client has an interest in a block of land we do not consider this in their rent subsidy assessment." Consideration The requirements of s 57 and s 58 of the Housing Act 55The terms of s 57(1) of the Housing Act, recited above, allow the Corporation to cancel a rental rebate. The decision to cancel the rental rebate may be implemented only "after conducting an investigation under s 58". As a consequence of the form of s 57(1) of the Housing Act, the conduct of an investigation under s 58 is a statutory pre-condition to the decision to vary or cancel a rental rebate. In that sense, it is a jurisdictional fact. 56As has been noted, the term "jurisdictional fact" is a broad expression that applies to a criterion the satisfaction of which enlivens the exercise of the statutory power or discretion in question: see Gedeon v Commissioner of the New South Wales Crime Commission [2008] HCA 43; (2008) 236 CLR 120 at 139 [43], (per Gummow, Kirby, Hayne, Heydon, Crennan and Kiefel JJ). Their Honours there said: "[43] The expression 'jurisdictional fact' was used somewhat loosely in the course of submissions. Generally the expression is used to identify a criterion the satisfaction of which enlivens the exercise of the statutory power or discretion in question. If the criterion be not satisfied then the decision purportedly made in exercise of the power or discretion will have been made without the necessary statutory authority required of the decision maker." 57The criterion that requires satisfaction to enliven the exercise of statutory power is not confined to that which is purely a question of fact and may include a mixed question of fact and law and may also include the existence of an opinion of a particular decision-maker or some other person: see Corporation of the City of Enfield v Development Assessment Commission [2000] HCA 5; (2000) 199 CLR 135. 58Thus, a jurisdictional fact is that which enlivens the capacity to exercise the statutory power or jurisdiction, or identifies a criterion which is a statutory pre-condition to the exercise of the jurisdiction or power, or the satisfaction of which mandates a particular outcome: see City of Enfield at [28] (per Gleeson CJ, Gummow, Kirby and Hayne JJ). 59As was made clear by the High Court in Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; (1998) 194 CLR 355, whether a particular fact or circumstance is "jurisdictional" ultimately depends upon the construction of the statute and the determination as to whether the legislature intended that the absence of the objective criteria will invalidate action under the statute. 60The Court of Appeal in Timbarra Protection Coalition Inc v Ross Mining NL [1999] NSWCA 8; (1999) 46 NSWLR 55 discussed the issue of jurisdictional fact and said: "[37] The issue of jurisdictional fact turns, and turns only, on the proper construction of the Statute. (See e.g. Ex parte Redgrave; Re Bennett (1946) 46 SR (NSW) 122, 125). The Parliament can make any fact a jurisdictional fact, in the relevant sense: that it must exist in fact (`objectivity') and that the legislature intends that the absence or presence of the fact will invalidate action under the statute ('essentiality'). (Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28 at [91]-[93]). [38] 'Objectivity' and 'essentiality' are two interrelated elements in the determination of whether a factual reference in a statutory formulation is a jurisdictional fact in the relevant sense. They are interrelated because indicators of 'essentiality' will often suggest 'objectivity'. [39] Any statutory formulation which contains a factual reference must be construed so as to determine the meaning of the words chosen by Parliament, having regard to the context of that statutory formulation and the purpose or object underlying the legislation. There is nothing special about the task of statutory construction with regard to the determination of the issue whether the factual reference is a jurisdictional fact. All the normal rules of statutory construction apply. The academic literature which describes "jurisdictional fact" as some kind of "doctrine" is, in my opinion, misconceived. The appellation "jurisdictional fact" is a convenient way of expressing a conclusion - the result of a process of statutory construction. [40] Where the process of construction leads to the conclusion that Parliament intended that the factual reference can only be satisfied by the actual existence (or non-existence) of the fact or facts, then the rule of law requires a Court with a judicial review jurisdiction to give effect to that intention by inquiry into the existence of the fact or facts." (Per Spigelman CJ, with whom Mason P and Meagher JA concurred.) 61In determining whether the objective existence of a fact is a pre-condition to the exercise of jurisdiction, one must bear in mind the inconvenience that may ensue if the construction were adopted that the legislature has made jurisdiction contingent upon the actual existence of a state of facts, as distinct from the opinion or determination of a court or tribunal as to that state of facts (see Parisienne Basket Shoes Pty Ltd v Whyte [1938] HCA 7; (1938) 59 CLR 369 at 391, per Dixon J). 62The issues associated with the inconvenience to which the High Court refers in Parisienne Basket are not of great moment in a situation such as the present, where the jurisdictional fact alleged by the plaintiff is the conduct of an inquiry by the Corporation. The conduct, in one sense, would be necessary in order to assess the basis upon which a cancellation of a rebate would occur. 63However, in the current situation, the plaintiff, Mr Navazi, asserts that s 58 of the Housing Act requires a particular kind of investigation, which did not occur. Since, it is submitted, the investigation that did occur was not one that met the criteria that Mr Navazi says were obligatory, the investigation was not a s 58 investigation and therefore the jurisdictional fact in s 57 has not been satisfied. As a consequence of the foregoing, if the submission were accepted, the decision of the Corporation would be vitiated by jurisdictional error and invalid. 64The plain and ordinary grammatical meaning of the provisions of s 57(1) of the Housing Act render the conduct of an investigation under s 58 a condition precedent to the power of the Corporation to vary or cancel a rental rebate. The question that arises in these proceedings is whether there has been such an investigation. 65There is some debate as to whether the terms under which the investigation was commissioned brought it within the terms of s 58 of the Housing Act. There is evidence that the subjective understanding of the investigators was that the power that they were exercising was one that was granted to them under s 58 of the Housing Act. In my view, whether an investigation has occurred under s 58 of the Housing Act is an assessment of the objective facts concerning the nature of the investigation and is not determined by the subjective understanding of the investigator. 66Nevertheless, the subjective understanding of the investigators, if derived from an act that formed part of the commissioning of the investigation, may be evidence as to the nature of the investigation being undertaken. 67Having made that qualification, the provisions of s 57 allow the Corporation to exercise the power to cancel a rebate "after" conducting an investigation. As a consequence, the investigation under s 58 must have concluded before the Corporation is empowered to cancel a rental rebate granted under the Act. 68In her letter of 17 November 2009 (summarised at [28] herein by reference to the earlier letter at [26]) Ms Morgan referred to the Corporation's authorisation to undertake an investigation "pursuant to s 58 of the Housing Act", but the substance of the issues with which Ms Morgan was concerned was the failure to notify the Corporation of changes to the circumstances of Mr Navazi and the requirements of ss 69 and 69A of the Housing Act. 69The subsequent correspondence confirms that the fundamental issue with which the Corporation was concerned was Mr Navazi's ownership of other premises. The correspondence, recited above, is replete with reference to criminal prosecution for breaches of s 69 of the Housing Act (relating to failure to advise of changes in circumstances) and the ownership of property that, in the opinion expressed in the correspondence, disentitled Mr Navazi to a rental rebate. 70The issue requiring determination is what is required in order for an investigation to be an investigation pursuant to s 58 and what is required before it is completed. Section 58 permits the Corporation, relevantly, to conduct "an investigation to determine the weekly income of" Mr Navazi. 71The focus of the investigation commissioned, if it were commissioned validly, was Mr Navazi's ownership of property. At no stage, on the evidence before the Court, did the Corporation determine, or investigate in order to determine, the weekly income of Mr Navazi. 72The investigation that was conducted, whatever was its subjective intent, was not an investigation "to determine the weekly income of Mr Navazi". The investigation was not an investigation under s 58 of the Housing Act. 73As a consequence of the foregoing, there has not been an investigation to determine the weekly income of Mr Navazi, there has not been an investigation under s 58 that has been conducted or concluded and, as a result, the power of the Corporation to cancel the rental rebate under s 57(1) of the Housing Act has not been enlivened. 74Further, to the extent that the decision was made after the conduct of an investigation, which, albeit invalidly, may have been subjectively thought to have been undertaken under the provisions of s 58, the decision to cancel the rebate was taken without consideration of a mandatory criterion. 75The statutory purpose for the conduct of an investigation under s58 of the Housing Act is to ensure that the weekly income of the person in receipt of a rebate is a factor before the Corporation at the time that it determines whether or not to cancel such a rebate. The investigation determined, whether correctly is irrelevant, that Mr Navazi owned other premises. It did not determine that Mr Navazi had a weekly income beyond that already disclosed as received as a result of his pension. 76There may be circumstances in which the Corporation is incapable of determining the income. This is not such a situation. There is no evidence before the Court to suggest that the Corporation was incapable, pursuant to a valid investigation under s 58 of the Housing Act, of determining how much, if anything, of the income received, if any, by Mr Navazi, resulted in an income to him. 77The purpose of the conduct of a s 58 investigation to determine the weekly income is so that, at the time the Corporation decides whether or not to cancel a housing rebate, it has such information before it. The weekly income, if capable of ascertainment, of a recipient of a rebate is a mandatory criterion that must be considered in determining whether to cancel that rebate. The Corporation did not consider Mr Navazi's weekly income. The Corporation failed to take into account a relevant mandatory consideration: Minister for Aboriginal Affairs v Peko-Wallsend Ltd [1986] HCA 40; (1986) 162 CLR 24 at 39-41. 78The determination of the proper meaning to be given to the term "income" in ss 57 and 58 is, for that purpose, irrelevant. Whatever be the meaning of the term "income", no part of the investigation, on the evidence before the Court, sought to determine the amount of that weekly income. 79Nevertheless, it is trite that the statute must be read as a whole and given a purposive construction. "A legislative instrument must be construed on a prima facie basis that its provisions are intended to give effect to harmonious goals. Where conflict appears to arise from the language of particular provisions, the conflict must be alleviated, so far as possible, by adjusting the meaning of the competing provisions to achieve that result which will best give effect to the purpose and language of those provisions while maintaining the unity of all the statutory provisions. Reconciling conflicting provisions will often require the Court 'to determine which is the leading provision and which the subordinate provision, and which must give way to the other'. Only by determining the hierarchy of the provisions will it be possible in many cases to give each provision the meaning which best gives effect to its purpose and language while maintaining the unity of the statutory scheme." (Project Blue Sky v Australian Broadcasting Authority [1998] HCA 28; (1998) 194 CLR 355 at [70] per McHugh, Gummow, Kirby and Hayne JJ). 80As the joint judgment later made clear, in determining the question of purpose, regard must be had to the language of the relevant provision and the scope and object of the whole statute. (Project Blue Sky, joint judgment, at [93].) 81It is in that context that the purpose of ss 57 and 58 of the Housing Act must be construed. Section 57 permits the Corporation to cancel a rebate granted under s 56. The power to be exercised under s 57 can only be exercised after the conclusion of an investigation under s 58. The purpose of an investigation under s 58 is to determine the income of the person receiving the rebate. Each of those provisions is designed to achieve the purpose of the statute and, relevantly, those purposes set out in s 5 and recited above. Those purposes include the equitable distribution of housing to people who are most in need and the focus of public housing on those people who are most in need. 82It is in that context that one must ascertain the meaning of the term "income" where used in s 58 of the Housing Act. As already stated, whatever be the meaning of the term "income" in the foregoing section, it was not determined or sought to be determined by the investigation that was commissioned and upon which the Corporation relied in exercising its powers under s 57 of the Housing Act. 83Nevertheless, it is an issue in these proceedings and it is an issue with which I will deal. The term "income" as used in s 58 must be understood and construed as part of an overall harmonious goal of the statute itself. The proposition, as I understand it, that the Corporation seeks to have the Court adopt is that a person without assets who borrows an amount, which amount is wholly expended on the purchase of a studio apartment, for example, that is rented and the rent from which is used to meet only part of the interest on the loan, is disentitled from the receipt of a housing rebate because all of the amount of rent, notwithstanding the cost of the loan, is taken into account in determining the "needs" of the tenant. 84Income is a word with different of meanings in different contexts. For an employee, income is the amount received by way of wages, salary and emoluments of office. For a person engaged in business, income is the earnings of the business and is the equivalent of a profit or gain made in the ordinary course of carrying on the business: see Federal Commissioner of Taxation v Myer Emporium Ltd [1987] HCA 18; (1987) 163 CLR 199. 85In the case of weekly income as referred to in s 58 of the Housing Act, it would most probably include dividends and royalties of a capital nature. In that way, what must be determined are the resources available to a tenant in order to live. In the case of the rental of property, it is the profit arising from the conduct of the undertaking and must exclude interest on the loan required in order to purchase the asset. (See discussion below.) 86The foregoing, in my view, achieves the purpose contained in the objects of the Act by excluding that which is not available to the tenant in order to live, but including all that is available, including certain capital receipts, to be dealt with by the tenant either for the purpose of living expenses or for the reduction of debt or the accumulation of assets. Policy considerations 87Another ground of challenge of the decision in question is the repeated assertion by the Corporation, or on its behalf, that the ownership of property, itself, disentitles Mr Navazi from the receipt of a rebate. That assertion was made both in recommendations, in correspondence and in conversations with Mr Navazi. 88Further, the date from which the cancellation of the rebate commenced coincided with the date upon which Mr Navazi purchased the property. There can be little doubt that it was the purchase of the property that occasioned the decision of the Corporation. 89Recited above is the policy document under the heading "Tenants who own or have a Share in Real Estate". That policy pronouncement makes clear that ownership of a property or a share in a property, of itself, does not disentitle a tenant from receipt of a rental subsidy. Rather, it is the ownership of a property "that could provide a viable alternative to public housing" that disentitles the tenant from said rebate. The use of the definite article in the expression "if a tenant ... is leasing the property" necessarily refers back to the property referred to in the first paragraph of that policy pronouncement being property "that could provide a viable alternative to public housing". 90There is no evidence that the Corporation investigated whether, or determined that, the property owned by Mr Navazi (assuming for this purpose, without deciding, that the property was so owned) could provide a viable alternative to the public housing that was provided. As a consequence, the policy pronouncement has no relevance. 91None of the foregoing depends upon any trust arrangement claimed by Mr Navazi. It is clear from the terms of the letter from Ms Morgan to Mr Perrett of 12 February 2010 (in particular paragraph 4 thereof) that Ms Morgan took the view that the property owned by Mr Navazi was not "suitable alternative accommodation" because of Mr Navazi's accommodation needs and disability. 92The foregoing conclusion is reached more comfortably because of the policy pronouncement in relation to income for self-employed clients. If a HNSW public housing tenant were in the business of owning and renting property, the only income that would be taken into account in determining that tenant's eligibility for a rebate would be the "gross income less legitimate business deductions", being those expenses that are "essential for producing an income". 93In that way, while the policy pronouncement does not include all allowable tax deductions for tax purposes, it allows a reduction for those items that are essential (as distinct from clearly appropriate or adapted for: see Ronpibon Tin NL & Tongkah Compound NL v Federal Commissioner of Taxation [1949] HCA 15; (1949) 78 CLR 47. In that sense the term "essential" is used rather than the term "necessary", which has, in the context of income tax laws, been construed in a much broader way than the term "essential". 94In any event, the policy pronouncements as to that which is taken into account in determining eligibility for rebate under s 56 of the Housing Act (and, given the necessity for harmonious goals, presumably to be taken into account in relation to the weekly income in ss 57 and 58 of the Housing Act) only relate to the profit after essential deductions from receipts of income. 95Moreover, it is clear that mere ownership, without more, of property does not disentitle a tenant from receiving a rebate. The property owned must be suitable alternative accommodation. Again, giving the statute a construction that achieves harmonious goals, the cancellation of a rebate cannot be occasioned by the mere ownership of property, unless that property is suitable alternative accommodation. 96To the extent that the Corporation has taken into account the ownership of property in the way already described, it has asked itself the wrong question and taken into account a consideration that is irrelevant and wrongly constrained the exercise of power or discretion it was undertaking. Conclusion 97Because of the conclusions already pronounced, it is unnecessary to deal with the issue of delegation. There is, to say the least, a tension between the provisions of s 15(1) and s 15(2) and the purported delegation of 24 September 2009, which purported to delegate all of the functions of the Corporation to the Chief Executive with the power to sub-delegate. It is unnecessary, in the circumstances of the foregoing, to determine this issue. 98It is clear from the foregoing that there has been jurisdictional error. The Corporation has failed to undertake an investigation of the kind that s 58 of the Housing Act contemplates. As a consequence, it has failed to conclude such an investigation in relation to Mr Navazi. Since the undertaking of such an investigation is a condition precedent or jurisdictional fact to the exercise of the power of the Corporation in s 57, there was no power or jurisdiction to cancel the rebate. 99Lest it be a matter of contention, I take the view that the internal review is permissible, but does not alter the law in relation to the foregoing. The operative decision is that with which I have already dealt. 100Lastly, in addition to the foregoing jurisdictional error, the Corporation, by taking the view that the ownership, simpliciter, of property disentitled Mr Navazi from receipt of a rebate, was in error. The error was an error of law. The Corporation, in dealing with the matter in that way, asked itself the wrong question and took into account an irrelevant consideration or failed to take into account a relevant consideration. The error of law had the effect of constraining, impermissibly, the exercise of its discretion/power. 101For all the foregoing reasons, orders in the nature of certiorari and prohibition are available and will issue. There is no discretionary reason why the orders ought not issue. 102The Court will make orders giving effect to the foregoing reasons. The Corporation shall pay Mr Navazi's costs of and incidental to the proceedings as agreed or assessed. 103The plaintiff shall file a Minute of the Order reflecting these reasons. The parties have liberty to seek a different or special order as to costs or the basis of assessment thereof. ********** 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: 01 March 2013