Holton v Chief Commissioner of State Revenue

[2003] NSWADT 97

CITATION:	Holton v Chief Commissioner of State Revenue [2003] NSWADT 97
DIVISION:	General Division
PARTIES:	APPLICANT Michelle Christian Holton RESPONDENT Chief Commissioner of State Revenue
FILE NUMBER:	023247
HEARING DATES:	18th March 2003
SUBMISSIONS CLOSED:	03/18/2003
DATE OF DECISION:	05/09/2003
BEFORE:	Higgins S - Judicial Member
APPLICATION:	first home owners grant - reversal of original decision - First Home Owners Grant Act - first home owners grant - reversal of original decision
MATTER FOR DECISION:	Principal Matter
LEGISLATION CITED:	Administrative Decisions Tribunal Act 1997 First Home Owners Grant Act 2000
CASES CITED:
REPRESENTATION:	APPLICANT In Person RESPONDENT D Martin, agent
ORDERS:	The decision of the Chief Commissioner to dismiss Ms Holton's objection to his decision to request the repayment of the grant is affirmed.

BACKGROUND
1 Ms Holton has made an application seeking review of the decision by the Chief Commissioner of State Revenue to dismiss her objection to his decision to request that she repay the $7000 First Home Owner grant that she had been paid previously. The basis of the Commissioner's decision was Ms Holton's failure to take up residence in the property, to which the grant related, within 12 months of the grant being paid. This was a requirement under section 12 of the First Home Owner Grant Act 2000 .

2 The Tribunal has jurisdiction to hear Ms Holton's application by virtue of sections 25 and 28 of the First Home Owner Grant Act and section 38 of the Administrative Decisions Tribunal Act, 1997.

RELEVANT LAW
3 Division 2 of Part 2 of the First Home Owner Grant Act sets out five eligibility criteria for a first home owner grant. The fifth eligibility criteria is set out in section 12 of the Act which provides, so far as is relevant, as follows:

Section 12(1) - An applicant for a first home owner grant must occupy the home to which the application relates as the applicant's principal place of residence within 12 months after completion of the eligible transaction or a longer period approved by the Commissioner.
4 Section 23 of the First Home Owner Grant Act gives the Commissioner power to vary or reverse a decision he has made in respect of an application for a grant where he is later satisfied that the decision is incorrect. However, he must do so within five years of the original decision having been made.

5 Section 24(1) of the First Home Owner Grant Act provides that where the Commissioner decides to reverse an earlier decision on an application for a grant, the Commissioner is required to give the applicant written notice of the reversal and state in the notice the reasons for the reversal.

6 Section 45 of the First Home Owner Grant Act gives the Commissioner the power to request the repayment of the amount approved and paid under an application for a grant under the Act. That section, so far as is relevant, provides:

45(1) - The Chief Commissioner may by written notice require an applicant (or a former applicant) for a first home owner grant to repay an amount paid on the application if:
(a) the amount was paid in error, or
(b) the Chief Commissioner reverses the decision under which the amount was paid for any other reason.
EVIDENCE
7 The facts in this case are not disputed and are primarily contained in the correspondence between the parties. In summary, they are as follows:
(a) On 14 August 2001, Ms Holton made an application for a first home owner grant in respect of a unit in Wollongong. That application was approved and $7000 was paid to her in September 2001.

(b) On 29 July 2002, Ms Holton wrote to the Commissioner advising him that her circumstances had changed and that she would not be moving into the Wollongong unit.

(c) On 5 August 2002, the Commissioner wrote to Ms Holton advising her of the provisions of section 12 of the First Home Owner Grant Act and requesting that she repay the $7000 grant that had been paid to her.

(d) On 19 August 2002, Ms Holton wrote to the Commissioner explaining that at the time she had made her application for the grant she had every intention of living and residing at the unit. However, her circumstances had changed after her application had been made. She sets out those changed circumstances in that letter. They primarily relate to her relationship difficulties having been resolved and that she was moving from the Wollongong area.

8 At the hearing, Ms Holton explained that the property was tenanted at the time she purchased it. She again stated that at the time she made her application for a grant she was having relationship problems and explained that she had purchased the unit as a safety net should the relationship break up. Accordingly, on 14 August 2001, when she made her application she only intended to reside in the unit if the need arose and at the time she thought there may be such a need.

9 She became the sole owner of the unit in October 2001 and at that time her position had not changed. Again, the property was her safety net should the need arise. The consequence of this was that the tenants who had resided in the property prior to her purchase continued to rent the property from her. The same tenants continue to rent that property today.

10 In July 2002, Ms Holton's relationship problems were resolved and she no longer felt she needed the unit as a safety net for a place where she could live.

11 There is no suggestion that Ms Holton has acted dishonestly in any way. Indeed, the reverse is the case as she informed the Commissioner immediately she became aware of her changed circumstances. Ms Holton, however, has never made an application for an extension of time within which to take up residence. This is understandable as she no longer wished to reside in the property due to her relationship difficulties having been resolved.

REASONS AND DECISION
12 The issue in this application is primarily whether the Commissioner in exercising his discretion under section 23 and 45 of the First Home Owner Grant Act has made the correct and preferred decision. In exercising his discretion under these provisions the Commissioner is required to take into account the objectives of the First Home Owner Grant Act and the matters put forward by Ms Holton.

13 As submitted by Mr Martin, for the Commissioner, the object of the First Home Owner's Grant Act is to assist persons who are purchasing their own home. The Act does not operate to assist persons purchasing investment properties. It is for these reasons that Parliament has specifically prescribed the various criteria, which makes persons eligible for a grant.

14 These criteria include a requirement that the applicant must reside in a property within 12 months of receiving the grant (see section 12). In this case Ms Holton has not complied with this requirement and there can be no question that prior to and since she purchased the property it has at all times been an investment property. That is, since October 2001 it has been Ms Holton's investment property for which she has received rent and continues to receive rent.

15 The Tribunal accepts that Ms Holton intended to reside in the property if her relationship ended. This did not happen and it is fair to say that at no time did Ms Holton in fact make a decision to move into the unit as her own home.

16 Having regard to the objectives of the First Home Owner Grant Act and the specific requirements of the applicant taking up residency in the property the subject of the grant and Ms Holton's stated intention together with the fact that the property has at all times been an investment property, I find that the Commissioner's decision is the correct and preferred decision.

17 Accordingly, I order that the decision of the Commissioner is affirmed.