Gonzalez v Commissioner of State Revenue
[2015] QCAT 65
•26 February 2015
| CITATION: | Gonzalez & Anor v Commissioner of State Revenue [2015] QCAT 65 |
| PARTIES: | Scott Gonzalez and Carli Gonzalez (Applicants) |
| v | |
| Commissioner of State Revenue (Respondent) |
| APPLICATION NUMBER: | GAR406-13 |
| MATTER TYPE: | General administrative review matters |
| HEARING DATE: | On the papers |
| HEARD AT: | Brisbane |
| DECISION OF: | Member Hughes |
| DELIVERED ON: | 26 February 2015 |
| DELIVERED AT: | Brisbane |
| ORDERS MADE: | The Commissioner of State Revenue’s decision to disallow an objection to the decision to repay the First Home Owner’s Grant is confirmed. |
| CATCHWORDS: | GENERAL ADMINISTRATIVE REVIEW – FIRST HOME OWNER GRANT – whether ‘eligible transaction’ – whether ‘new home’ – whether property ‘sold as a place of residence’ – where property previously transferred from original developer to subsequent developer – where test for ‘sold as a place of residence’ is objective and does not depend on parties’ acts and intentions – where purpose of property was multi-unit dwelling – where policy intent of Parliament is to benefit buyers of new homes and boost housing construction sector – where policy intent achieved in first transfer from original developer to subsequent developer – ESTOPPEL – where incumbent upon applicant for grant to provide correct information to Commissioner First Home Owner Grant Act 2000 (Qld), ss 5, 6, 10 Betts & Anor v Commissioner of State Revenue [2013] QCAT 283 |
APPEARANCES and REPRESENTATION (if any):
This matter was heard and determined on the papers pursuant to section 32 of the Queensland Civil and Administrative Tribunal Act 2009 (QCAT Act).
REASONS FOR DECISION
What is this Application about?
Like most people, Scott Gonzalez and Carli Gonzalez were excited about realising their dream of buying their first home. However, their dream turned into a nightmare when told they were required to repay the First Home Owner’s Grant of $15,000.00.
Understandably, Mr and Mrs Gonzalez are distraught and have applied to the Tribunal for relief. Specifically, Mr and Mrs Gonzalez want the Tribunal to review the decision of the Commissioner of State Revenue to disallow their objection to repay the grant.
The Tribunal may confirm, amend or set aside the Commissioner’s decision and substitute a new decision.[1] The Tribunal’s role is to produce the correct and preferable decision[2] by way of a fresh hearing on the merits.[3]
[1]QCAT Act s 23(2).
[2]Ibid s 20(1).
[3]Ibid s 20(2).
Did Mr and Mrs Gonzalez enter into an ‘eligible transaction’ for the First Home Owner Grant?
A first home owner grant is payable for an ‘eligible transaction’.[4] An ‘eligible transaction’ is relevantly a contract made for the purchase of a ‘new home’.[5]
[4]First Home Owner Grant Act 2000 s 10(1)(b).
[5]Ibid s 5(1)(a).
It would appear that the original developer went into receivership[6] and sold the unit to a subsequent developer[7] – who then sold the unit to Mr and Mrs Gonzalez.[8]
[6]Deed of appointment of receiver and manager for Ishmael Investments Pty Ltd dated 30 November 2009 and ASIC Notification that a person has been appointed controller/entered into possession etc. dated 7 January 2010.
[7]Transfer from Ishmael Investments Pty Ltd (Receivers and Managers Appointed) to Tarn Nominees Pty Ltd dated 31 July 2012.
[8]Transfer from Tarn Nominees Pty Ltd to Scott Fabian Gonzalez and Carli Alece Gonzalez dated 11 April 2013.
Mr and Mrs Gonzalez submitted that because the previous seller did not occupy the unit and did not intend to occupy the unit and no other person occupied the unit, the property is effectively a new home.[9] The difficulty for Mr and Mrs Gonzalez is that this addresses only one part of the definition of a ‘new home’ in determining eligibility for the grant.
[9]Letter Property Law Solutions to Office of State Revenue dated 3 September 2013.
The law requires that a ‘new home’ is not previously occupied or sold as a place of residence.[10] As Mr and Mrs Gonzalez correctly point out in their submissions,[11] the word ‘or’ is disjunctive – meaning one or the other. However, the word ‘not’ preceding the word ‘or’ means that only one of the elements needs to be satisfied for the property to not be a ‘new home’. This means that a property not previously occupied can still be a ‘new home’ if sold as a ‘place of residence’.
[10]First Home Owner Grant Act 2000 s 6(2)(a).
[11]Document entitled “Relevant Evidence” filed 29 May 2014.
Unfortunately for Mr and Mrs Gonzalez, the act of moving in by the previous owner is only relevant to determine whether their unit was previously occupied, not whether it was previously sold as a place of residence.
The test of ‘sold as a place of residence’ is objective and does not depend on the acts or intentions of the parties, but the predominant character of the property.[12] It is not physically moving in or the parties’ intent that characterises the property, but the purpose for which it is built. That purpose is clear from the Transfer document of the previous sale that notes the ‘current land use’ as ‘multi-unit’ and not commercial, etc.[13]
[12]Betts & Anor v Commissioner of State Revenue [2013] QCAT 283 at [20].
[13]Property Information (Transfer) Form 24 dated 31 July 2012.
Therefore, the property was previously ‘sold’ as ‘a place of residence’ – a place to live in or reside. The law as it currently is does not require the buyer to actually live in or reside in the property for it to be ‘sold as a place of residence’.
This means that Mr and Mrs Gonzalez did not enter into an ‘eligible transaction’ and are therefore not eligible for the First Home Owner Grant for a ‘new home’.
How does this achieve Parliament’s policy objectives?
Mr and Mrs Gonzalez contend that this outcome is anomalous because the intention of the First Home Owner Grant Act 2000 was to encourage first home owners.[14] Mr and Mrs Gonzalez are concerned that because they have “technically” purchased their first home, they may be permanently prevented from obtaining the grant in future.[15]
[14]Letter Property Law Solutions to Office of State Revenue dated 3 September 2013 and Application to review a decision dated 19 November 2013, Annexure A.
[15]Application to review a decision dated 19 November 2013, Annexure A.
However, Mr and Mrs Gonzalez’s ineligibility is not a mere technicality. In 2012, Parliament shifted its policy intent away from helping first home buyers as a whole. Parliament did this by amending the original definition of ‘eligible transaction’ to restrict the grant only to buyers of ‘new homes’.[16] This sharply focused the policy intent.
[16]Fiscal Repair Amendment Act 2012 s 15.
Previously, the definition of ‘eligible transaction’ extended to first home buyers, regardless of whether the home was a ‘new home’.[17] By amending the definition, Parliament signalled its policy objectives to restrict eligibility for the grant only to first home buyers who build or buy a new home[18] and thereby boost the housing construction sector:
[The Fiscal Repair Amendment Bill] discontinues the grant for existing homes from 11 October 2012.
The First Home Owner Grant originally compensated first home buyers for the increase in housing costs due to the goods and services tax. The current consensus is that the grant is a relatively inefficient mechanism for improving home affordability. However, an increased grant for first home buyers purchasing a new home will benefit first home buyers and boost the housing construction sector.[19] (My emphasis).
[17]First Home Owners Grant Act 2000 s 5(1) as in force before 11 October 2012.
[18]Fiscal Repair Amendment Bill 2012 Explanatory Notes at 2 and 10.
[19]Minister’s Second Reading Speech, Queensland Hansard 11 September 2012 at 1823.
Therefore – regardless of the parties’ intentions – Parliament achieved its policy objectives to boost the housing construction sector (and consequential jobs) when the property was built and first transferred.[20] That happened before Mr and Mrs Gonzalez purchased it.
[20]Betts & Anor v Commissioner of State Revenue [2013] QCAT 283 at [20].
Is the Commissioner estopped from reassessing eligibility for the grant?
Mr and Mrs Gonzalez are understandably concerned about repaying the grant and any interest. However, this cannot detract from them having received a benefit to which they were not entitled at law – payment of the grant. This helped them purchase the property.
Mr and Mrs Gonzalez claim that they would not have purchased the property if the Commissioner had not given their broker and financier approval of the grant.[21] They say the Commissioner approved the grant after requesting information from the seller that the property was “brand new”. They therefore contend that the Commissioner had ample opportunity to reject the grant prior to the Contract of Sale becoming unconditional.[22]
[21]Letter Property Law Solutions to Office of State Revenue dated 8 August 2013.
[22]Ibid.
However, this does not mean that the Commissioner is prevented or estopped from reassessing eligibility when the initial assessment is based on incorrect information.[23] It is incumbent upon Mr and Mrs Gonzalez as applicants for the grant to provide correct information to the Commissioner and conduct proper checks on the property they are purchasing.
[23]Clarke v Commissioner of State Revenue [2014] QCAT 589 at [20].
Nevertheless, the Tribunal is mindful that Mr and Mrs Gonzalez were led to believe that they were eligible for the grant. No doubt Mr and Mrs Gonzalez would have appreciated being told earlier that they were not eligible. It appears that as first home buyers, Mr and Mrs Gonzalez understandably relied upon professional advisors to assist them with the process of providing correct information and conducting proper checks. The words of the learned Member Allen resonate:
Clearly it would be appropriate where there are such clear criteria of eligibility that applicants who are not eligible are informed of this fact as early as possible to save both themselves and the Commissioner from wasted effort.[24]
[24]Ivens v Commissioner of State Revenue [2014] QCAT 361 at [9].
What are the appropriate Orders?
The appropriate Order is to confirm the Commissioner’s decision to disallow an objection to the decision to repay the grant.
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