Lifestyle Investments 1 Pty Ltd v Commissioner of State Revenue

SUPREME COURT OF VICTORIA

COURT OF APPEAL

S EAPCI 2020 0082
S EAPCI 2020 0096

LIFESTYLE INVESTMENTS 1 PTY LTD (ACN 083 091 016) and others according to the schedule	Applicants/Cross-respondents
v
COMMISSIONER OF STATE REVENUE	Respondent/Cross-applicant

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JUDGES:	FERGUSON CJ, TATE and KENNEDY JJA
WHERE HELD:	MELBOURNE
DATE OF HEARING:	26 February 2021
DATE OF JUDGMENT:	30 April 2021
MEDIUM NEUTRAL CITATION:	[2021] VSCA 107
JUDGMENT APPEALED FROM:	[2020] VSC 397 (Nichols J)

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LAND TAX – Exemption for land used as registered caravan park – Scope of exemption – Caravan park developed in stages – Whether whole or part of park exempt – Meaning of land ‘used as’ – Need for apportionment – Applewood Residential Developments Pty Ltd v Commissioner of State Revenue [2006] VSCA 207, Eaton & Sons Pty Ltd v Warringah Shire Council (1972) 129 CLR 270, considered – Land Tax Act 2005 ss 77(1), 77(2), 77(3); Residential Tenancies Act 1997 Part 4A.

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APPEARANCES:	Counsel	Solicitors
Applicants/Cross-respondents	Mr C J Horan QC with Mr N Kotros	Pitcher Partners Legal Pty Ltd
Respondent/Cross-applicant	Mr D J Williams QC with Mr D Morgan	Solicitor for the Commissioner of State Revenue

FERGUSON CJ
TATE JA:

Introduction and summary

We have had the considerable benefit of reading the draft judgment of Kennedy JA. We rely on the factual background, and the statutory and regulatory framework, as set out by her Honour. In what follows we seek to avoid any unnecessary repetition. Regrettably, we find that we are unable to agree with her Honour’s conclusion.

Section 77(1) of the Land Tax Act 2005 (‘the LTA’) exempts from land tax, land that the Commissioner of State Revenue (‘the Commissioner’) determines is ‘used as a registered caravan park’.[1] In our view, where, as here, the relevant land has been registered and is operating as a caravan park, the application of s 77(1) is to be determined by asking the key question: ‘On what part of the land could movable dwellings be situated?’ This focuses upon the use of the land not the state of construction of any dwellings, it reflects the relevant statutory definitions, and, not being limited to actual occupancy, it takes account of the observation made by the primary judge that fluctuating levels of occupancy are an inherent characteristic of caravan parks.[2]
[1]Emphasis added.
[2]Lifestyle Investments 1 Pty Ltd v Commissioner of State Revenue [2020] VSC 397, [68] (‘Reasons’).

The key question is to be answered by reference to the circumstances that exist on the date relevant to the assessment of land tax. Here the relevant date is 31 December 2015.[3] The key question becomes: ‘As at 31 December 2015, on what part of the land could movable dwellings be situated?’ That part of the land together with those parts of the land used for supporting communal infrastructure are exempt from land tax under s 77. Those parts of the land were being used as a registered caravan park at the relevant date. The answer should take account of the nature of the registration granted (short-term or long-term sites). Where an area of land has not yet been cleared, or otherwise prepared for movable dwellings by the completion of civil works, it does not attract the exemption.
[3]This is the date relevant to the 2016 land tax year.

We consider that the applicants have not discharged their onus, pursuant to s 110 of the Taxation Administration Act 1997 (‘the TAA’) to prove their case. We consider that the proportionate exemptions that the Victorian Civil and Administrative Tribunal (‘VCAT’) ordered the Commissioner to make, should apply.

We would grant leave to appeal,[4] dismiss the appeal, grant leave to cross-appeal and allow the cross-appeal. We would set aside the orders made by the Honourable Justice Nichols on 14 July 2020 and in their place order that the appeal to her Honour is dismissed with costs and declare, consistently with the orders of VCAT made on 20 June 2019, as amended on 10 July 2019, that the assessment for the 2016 land tax year dated 19 May 2016 (no 97129308) is varied to exempt from land tax, under ss 22 and 77(3) of the LTA:

(a) 47 per cent of the land at 28–36 Barton Street, Bell Park 3215 known as Lifestyle Geelong; and

(b) 51 per cent of the land at 150 De Rossi Boulevard, Wollert 3750 known as Lifestyle Lyndarum.

[4]For convenience, in what follows, we refer simply to ‘the appeal’.

Lifestyle Communities — registered caravan parks

Lifestyle Lyndarum and Lifestyle Geelong were registered as caravan parks by the applicants in 2015, pursuant to the Residential Tenancies (Caravan Parks and Movable Dwellings Registration and Standards) Regulations 2010 (‘the Regulations’). The applicants trade under the name ‘Lifestyle Communities’. However, the ‘caravans’ situated on them are far removed from the idea of a caravan as ordinarily understood. The statutory scheme under the Residential Tenancies Act 1997 (‘the RTA’) allows for different types of caravans including, under Part 4A, substantial dwellings designed to endure. This has implications for the exemption under s 77(1) because whatever meaning is afforded to that exemption must be capable of applying to land on which Part 4A dwellings are situated as well as land on which traditional caravans are situated.

The core concept is that of a ‘movable dwelling’ under the RTA, that is, ‘a dwelling that is designed to be movable, but does not include a dwelling that cannot be situated at and removed from a place within 24 hours’.[5] ‘Caravan’ is relevantly defined to mean ‘a movable dwelling’. A ‘caravan park’ is relevantly defined as ‘an area of land on which movable dwellings are situated for occupation on payment of consideration’.[6] A traditional caravan would satisfy the definition of a ‘registrable movable dwelling’ under the Regulations, meaning a movable dwelling that is, or has been, registered or is required to be registered under the Road Safety Act 1986.[7]
[5]RTA s 3.
[6]Ibid.
[7]Regulations reg 5.

Lifestyle Lyndarum and Lifestyle Geelong are designed to contain Part 4A movable dwellings. Part 4A of the RTA governs site agreements and site-tenant owned dwellings. The RTA relevantly defines a ‘Part 4A dwelling’ as ‘a dwelling fully or partially owned by a site tenant — (a) designed, built or manufactured to be transported from one place to another for use as a residence … but does not include — (c) a registrable movable dwelling’. Part 4A dwellings are ‘unregistrable movable dwellings’ (sometimes referred to as ‘UMDs’), that is, a ‘movable dwelling that — (a) is constructed on a chassis or in prefabricated sections; and (b) once installed, is a freestanding dwelling with solid walls and roof; and (c) is not a registrable movable dwelling’. A ‘Part 4A park’ means ‘an area of land where — (a) sites of land are available for occupation under a site agreement; and (b) Part 4A dwellings may be situated on those sites; and (c) common areas or facilities are available for the use of a person occupying a Part 4A site — and includes a caravan park if the caravan park contains Part 4A sites’.

The Managing Director of the applicants, James Kelly (‘Kelly’), gave evidence before VCAT that Lifestyles’ residential communities are marketed as ‘resort style’ living. Each community has a clubhouse and various other communal facilities, for example, a bowling green, swimming pool and outdoor BBQ area. Kelly was the only witness at VCAT.

Kelly explained the stages involved in developing land that the applicants purchase for the purpose of establishing a ‘Lifestyle Communities’ residential community, of which Lifestyle Lyndarum and Lifestyle Geelong are two examples. Once the applicants have received a planning permit ‘to build the residential village’ they apply for approval of civil designs from the local council and lodge an application for a building permit. Having obtained those necessary approvals, they commence civil works on the land; this includes ‘digging, building roads, sewerage and drainage systems, and trenches for gas, water and electricity’. Kelly explained that there was progressive development of the land; he said that ‘we do the civil works in stages’. He said:

Once civil works are complete on the first stage, we commence building the community clubhouse.
At the same time, our builder, Todd Devine, starts building 20 to 30 homes [that is, Part 4A dwellings], depending on pre-sales.
We commence civil works for the next stage while the clubhouse and homes for the first stage are under construction.

Kelly also explained that it took about 62 working days to build a Part 4A dwelling. The dwellings include carports and garden areas and are classified as UMDs under the RTA. Kelly said, ‘[t]hey look like traditional homes, but they are designed to be movable in 24 hours. They are not considered “fixtures”’.[8]
[8]Section 206C of the RTA relevantly provides that ‘a Part 4A dwelling owned by a site tenant does not form a fixture of the Part 4A site on which the Part 4A dwelling is situated’.

A resident buys a dwelling and a share of the community infrastructure and rents a particular site under a ‘Residential Site Agreement’ on a 90-year lease from Lifestyle Communities which owns the whole of the land on a single certificate of title.

Before a community is opened, it is registered as a caravan park, under the Regulations. These set ‘certain standards for the caravan park as a whole, such as in relation to fire safety, emergency management and water, lighting and other amenities’. The registration certificate ‘shows the number of “sites” within the caravan park. This is the total number of sites; that is, both those currently with “caravans” and those that will in the future have them’. There are also regulations in respect of the UMDs. Kelly said:

Separately from registration of the caravan park, the regulations set standards for the design and installation of the caravans or UMDs themselves. The regulations require that the local council be given notice of the installation of each UMD, that the builder give an ‘installation certificate’ certifying compliance with the regulations, and that the UMD be affixed with a ‘compliance plate’.

The applicants applied for registration of 155 ‘long-term’ sites and registration was granted by the City of Whittlesea on 29 July 2015. It can be inferred that ‘long-term’ sites are sites that can be occupied by UMDs. This is apparent from Kelly’s description of Lifestyle Lyndarum as comprising 155 sites ‘each with a home, carport and garden; a club-house, with a swimming pool, gym and cinema; a tennis court; a lawn-bowling green; car and recreation vehicle parking areas; outdoor communal areas; and roads and other infrastructure and improvements’. By March 2015, installation certificates ‘had been done for some homes’. The certificate of registration recorded that a recent report had been received from the relevant fire authority and that an emergency management plan had been prepared.

The clubhouse was used by residents from about May 2015 and it was officially opened in October 2015. The community ‘began operating whilst it continued to grow with more homes and residents’. Kelly exhibited a plan for Lifestyle Lyndarum, as at 31 December 2015 (Annexure A to this judgment), and an aerial photograph taken on 19 January 2016 (Annexure B). The plan indicates the 155 sites broken into Stages 1, 2 and 3. It also indicates the UMDs that were occupied (pink dots); the UMDs that had been fully built but in respect of which settlement had not yet occurred (blue dots); and the UMDs that were at the ‘frame stage’ of construction that might not yet have been purchased (green dots). The plan also shows the clubhouse and other communal facilities and roads and pedestrian gates. Kelly stated:

In summary, as at 31 December 2015, about half of the total homes in the community were occupied or ready for occupation, the clubhouse and other communal facilities were in use, construction of more homes was occurring, the rest of the land was available for use by the residents, and the community had been registered as a caravan park. It remains a functioning residential community.

With respect to Lifestyle Geelong, Kelly said that the applicants applied for registration of the community as a 165 ‘long-term’ site caravan park. Registration was given on 25 November 2015 and later amended on 6 May 2019 with effect from 25 November 2015.[9] The registration certificate noted that both the categories of ‘short term sites’ and ‘camp sites’ were ‘N/A’ (not applicable). It also noted that there was a recent report from the County Fire Authority and that an emergency management plan had been prepared.
[9]The original certificate of registration given on 25 November 2015 related only to Stage 1 of the park development. It contained a number of conditions prior to the commencement of use, including construction of the drainage system, completion of landscaping works, and so on.

The clubhouse was fully built and used by the residents from 24 December 2015, with an ‘official’ opening date of 13 January 2016. Kelly exhibited a plan for Lifestyle Geelong, as at 31 December 2015 (Annexure C to this judgment), and an aerial photograph taken on 19 December 2015 (Annexure D). The plan has the same coloration as the plan for Lifestyle Lyndarum that indicates the clubhouse, other communal facilities, roads and pedestrian gates. It also indicates three stages of development. He said:

In summary, as at 31 December 2015, about one-third of the homes were occupied or ready for occupation, the clubhouse and other communal facilities were in use, construction was occurring on certain parts of the land, and the rest of the land was available for use by the residents.

Kelly gave evidence that the aerial photograph of 28–36 Barton Street shows ‘very vacant’ parts of the land to the east.

There was no evidence that the land not under construction had been intended by the applicants to be set aside and used on an ongoing basis by the residents for walking their dogs, or for recreation (as would be evidenced by, for example, an empty football field), or that the applicants had a contractual right to use the vacant land in that way.[10] Residents were informally taking advantage of the empty sites, that is, sites that had not yet been built on, to walk their dogs or engage in recreation and there was no objection by the applicants to them doing so.[11] An informal arrangement on vacant land is not relevant to the characterisation of the land for land tax purposes.[12]
[10]This stands in contrast to the circumstances in Council of the City of Newcastle v Royal Newcastle Hospital (1959) 100 CLR 1 where land was kept vacant intentionally to keep the atmosphere clear and unpolluted and to provide quiet and serene surroundings for the hospital patients.
[11]Reasons [141].
[12]See Applewood Residential Developments Pty Ltd v Commissioner of State Revenue [2006] VSCA 207, [32] (Nettle JA).

Statutory scheme

To ascertain the intended scope of the exemption provided for under s 77(1), it is necessary to consider not only the statutory language employed but also its place within the statutory scheme. It is common ground that ‘use’ is a protean concept that will derive its meaning largely from the particular subject matter with which the legislation is concerned and its context in that legislation. Here the statutory context can assist by providing some core propositions to aid in evaluating the competing constructions of s 77(1) that we consider below.

It is necessary first to distinguish between the test employed by s 77(1) of the LTA and the test employed by other related exemptions. While s 77(1) declares land to be exempt if the Commissioner determines that it is ‘used as a registered caravan park’, s 78(1) provides that land is exempt ‘if it is occupied, or currently available for occupation, as a retirement village’.[13] The proximity of the exemptions indicates that there was a deliberate legislative choice in s 77(1) to employ the language of ‘use’ rather than ‘occupation’. Occupancy is more closely connected to persons inhabiting a dwelling than to the use of land. This is evident in, for example, the definition of ‘retirement village’ in s 78(3) as ‘a complex containing residential premises … predominantly or exclusively occupied, or available for occupation, by retired persons’.[14]
[13]Emphasis added.
[14]Emphasis added.

It is true that the definition of a ‘caravan park’ also refers to occupation; it is relevantly ‘an area of land on which movable dwellings are situated for occupation on payment of consideration’.[15] In our view, the words ‘for occupation’ refer to the purpose for which the movable dwellings are situated on the land. This does not require immediate physical occupation, or present availability for occupation, but rather reflects the objective with which the movable dwellings are situated on the land. Indeed, the definition of a ‘caravan park’ draws attention to the need to focus on the land and its use and not on the occupancy of a dwelling.
[15]Emphasis added.

Second, it is important to note that s 77(1) also invites attention to the use of the land, not the stage at which any dwelling upon that land (including a UMD) has been constructed. It follows that the installation certificates issued for UMDs, or other completed stages of construction of a UMD, are not a reliable guide to when the exemption applies.

Third, it is fundamental to the exemption under s 77 that it directs an apportionment. Section 77(3) of the LTA provides: ‘If the Commissioner is satisfied that only a part of land is used as a registered caravan park — (a) land tax is assessable on the remaining part of the land, unless another exemption applies to that part’.[16] This makes it plain that the exemption attaches to the land only in proportion to that part of the land which satisfies the requirement under s 77(1).
[16]Emphasis added.

Assessment of land tax based on a process of apportionment is a frequent feature under the LTA. Section 78(2) provides for an apportionment where only a part of the land satisfies the requirement under s 78(1) (occupied, or currently available for occupation, as a retirement village). So too, s 76(3) ensures that land tax remains assessable on any part of the land that does not satisfy the requirement under s 76(1) of being occupied, or currently available for occupation, as a residential care facility or a supported residential service. By way of example, analogous apportionment provisions apply to the exemption for the use of land by a charitable institution exclusively for charitable purposes (s 74);[17] the exemption for the use and occupation of land as a rooming house (s 75);[18] and the exemption for land that is occupied, or currently available for occupation, as a residential service within the meaning of the Disability Act 2006 (s 76A).[19] The direction for apportionment also reflects the manner in which land tax is imposed under the LTA, that is, on an annual basis focusing on the character of the land at a particular point in time. In any one year the part of the land that is exempt may be larger or smaller than that part which is exempt in another land tax year.
[17]See s 74(2).
[18]See s 75(5).
[19]See s 76A(3). See also s 22(1) of the LTA which provides that ‘[t]his section applies if ― (a) it is necessary to determine the taxable value of part of land (the part) for or in a tax year; and (b) the part was not valued separately as at the relevant date … in relation to that year; and (c) the whole land was valued separately as at the relevant date’. Section 22(2), at the relevant time, provided: ‘The taxable value of the part is the same proportion of the taxable value of the whole land as the area of the part bears to the area of the whole land’.

In our view, s 77(3) has the effect that s 77(1) must be read as providing that the exemption applies only in respect of those parts of the land that, at the relevant time, are used as a registered caravan park.

Fourth, the direction for apportionment in s 77(3), coupled with the focus upon the use of the land in s 77(1), supports the view that relying upon the official status of the land as land that has been granted registration as a caravan park cannot be sufficient to attract the exemption. In our view, this also suggests that it is not sufficient to rely on an ‘augmented’ form of registration; that is, registration augmented by intention on acquisition, planning permission, commencement of operations and a process of staged development. None of those factors, individually or in combination, establishes how much of the land is used at any particular point of time as a registered caravan park. The focus must be on what parts of the land are relevantly used at the appropriate time supported by evidence of that use and not evidence of a surrogate for that use.

Fifth, it is relevant that, as mentioned,[20] s 77(1) does not distinguish between traditional caravan parks and Part 4A parks, and the test it imposes to attract the exemption must be capable of application to both.
[20]See [6] above.

Competing constructions of s 77(1)

During the proceeding, four competing constructions (or applications) of s 77(1) have been adopted by: (1) the Commissioner as applied by VCAT; (2) the primary judge; (3) the applicants; and (4) the Commissioner on the appeal in this Court.

The Commissioner contended before VCAT that, with respect to the 2016 land tax year, Lifestyle Lyndarum was 51 percent exempt under s 77(1) and Lifestyle Geelong was 47 per cent exempt. This was based upon the number of UMDs on the land that had reached ‘frame stage’ in their construction. The exemption did not extend to those parts of the land where dwellings were under construction on sites but not yet at frame stage and sites which were yet to be developed. However, in this Court the Commissioner concedes that the criterion he applied was arbitrary, although he considers it to be beneficial to the applicants. In our view, in principle it would be wrong to condone the adoption of the arbitrary standard of ‘frame stage’ as the test to be applied in the application of s 77(1). Moreover, we consider, for the reasons expressed above,[21] that the application of the ‘frame stage’ criterion wrongly attracts attention to the process of the construction of a dwelling and not the use of the land. This does not properly reflect the words of the exemption.
[21]See [23] above.

The percentage exemptions relied on by the Commissioner were upheld by VCAT. VCAT identified the issue arising from s 77(1) as ‘whether the reference to “use” refers to current physical use as a caravan park or extends to the whole of a site acquired for and devoted to the purpose of a caravan park, albeit that some areas remain under construction’.[22] VCAT rejected the latter option, advocated by the applicants, on the basis, amongst other things, of the significance of the apportionment provision in s 77(3):

[T]he full caravan park exemption in section 77(1) of the LT Act must be read together with the partial exemption found in section 77(3). It is clearly contemplated that there will be circumstances where some part, but not all, of the land which in a broad sense forms part of a ‘caravan park’ will be ‘used as’ such.[23]

[22]Lifestyle Investments 1 Pty Ltd v Commissioner of State Revenue [2019] VCAT 920, [19] (‘VCAT reasons’).

[23]Ibid [42].

VCAT accepted that ‘use’ in s 77(1) reflects a broader concept than ‘occupy’, and to that extent the decision of this Court in Applewood Residential Developments Pty Ltd v Commissioner of State Revenue (‘Applewood’),[24] that dealt with exemptions for retirement villages, was to be distinguished. Applewood was concerned with the exemption provided for under s 9(1)(j) of the Land Tax Act 1958 that provided that ‘land which is used and occupied as a retirement village and for no other purpose … is exempt from land tax.’ VCAT acknowledged that ‘use might extend to completed caravans that are not yet occupied … [but] this does not grapple with the limitation the partial exemption places on the interpretation of the scope of the full exemption’.[25] Having accepted the need for apportionment, and in the absence of any contrary submissions, VCAT accepted that the exempt percentage of the land should reflect the percentages adopted by the Commissioner.
[24][2006] VSCA 207 (Chernov, Nettle and Redlich JJA).
[25]VCAT reasons [44].

On appeal from VCAT, the primary judge determined that VCAT had failed to properly construe and apply s 77(1). The judge remitted the matter to VCAT to complete factual findings relevant to the proper construction and application of the statute and to determine the matter according to law.

The primary judge determined that ‘[t]he essence of use of land as a registered caravan park … is the present availability of land for occupation by site tenants or residents, and the related availability of common areas and facilities for the use of site tenants or residents’.[26] We consider that, despite the careful and comprehensive analysis adopted by the primary judge, the test the judge arrives at is mistaken. By linking the availability of the land to ‘occupation’, and focusing upon the occupation of site tenants or residents, the primary judge treats the use of land as a registered caravan park as a function of the habitability or otherwise of the dwellings, the UMDs. This is reinforced by the judge’s reference to the rights of occupation of a site tenant under a site agreement.[27] We consider that this approach is wrong for the reasons set out above.[28]
[26]Reasons [64] (emphasis added). See also Reasons [131].
[27]Reasons [138].
[28]See [21]–[23] above.

It should be acknowledged, however, that there is an ambiguity in the judge’s reasons in that there are passages that focus not on the availability of the land for occupation by site tenants, which, given the nature of the Part 4A parks, depends upon the construction of significant dwellings, but rather on whether the owner of the land has made the land available for occupation. In other words, the judge appears at times to accept that the exemption may be attracted in respect of land that the applicants have made available for occupation (although she does appear to tie this to the availability for occupation by a site tenant of a Part 4A dwelling). This is apparent from the following passage in [66] and [67] of the reasons:

Both parties accepted, as do I, that relevant use of the land may be use by an owner or operator of a caravan park, or by a resident. There is nothing in the language of s 77 of the Land Tax Act to suggest that it must be one or the other. A resident may use land within a caravan park by occupying a dwelling situated on it, or by using common areas or facilities. A caravan park owner may use it by making land within the caravan park available for occupation.
To elaborate, a site within a Part 4A park which is occupied by [a] Part 4A dwelling which is let to a site tenant, is relevantly used — at least by the tenant. A site within a Part 4A park which is presently available for occupation under a site agreement (although unoccupied by a dwelling or unlet) is relevantly used — by the owner, who is making it available for occupation. Common areas or facilities that are presently available for use by persons occupying sites within the park are being relevantly used. There may be other parts of the land that are used by the caravan park operator in the course of operating the caravan park.[29]

[29]Original italicised emphasis. The emphasis by underlining is added.

The last line of [66] focuses upon the use by the owner and the question of which parts of the land, being registered and operating as a caravan park, is available for occupation by caravans (including, in respect of a Part 4A park, UMDs). Decoupled from the use by a site tenant, this construction of s 77(1) finds some favour with both the Commissioner[30] and the applicants, although the applicants submit that its application to the circumstances ought result in an exemption for the whole of the land. It is similar to the construction which we consider to be correct, discussed below.[31]
[30]See [49] below.
[31]See [50] below.

In our view, the judge was wrong to focus upon the site tenant or resident. It is unlikely that there could ever be use by a resident of a registered caravan park that did not amount to use by the owner. There may be more than one user. However, it is the owner who is the person on whom land tax liability is imposed, and it is the owner’s use that is determinative. Insofar as the judge expressed the test as based on ‘occupation’ by site tenants pursuant to their rights under site agreements, we reject it.

With respect to the applicants’ construction, they submitted before the primary judge that registration of the land as a caravan park was sufficient to attract the exemption. This was correctly rejected by the primary judge as s 77(1) assumes registration but requires, in addition, use. In the alternative, the applicants relied, before the judge and in this Court, upon ‘five facts’ that they submit, collectively, demonstrate that the whole of the land of the Lifestyle Lyndarum and Lifestyle Geelong communities was exempt under s 77(1). As identified by Kennedy JA[32] these comprise the fact that: (1) the land was acquired for development and use as registered caravan parks, and had received planning permission as such; (2) the land had been developed into caravan parks by 31 December 2015, including by the establishment of various communal recreational facilities and amenities appropriate to a caravan park; (3) registration had been obtained for each community as a caravan park; (4) each community had opened and commenced operating as a registered caravan park; and (5) each land was wholly devoted to the business of the caravan owner, there being no competing use or purpose. The applicants also rely on there being no abandonment of the land for the purpose for which it was registered. This alternative submission amounts to an ‘augmented’ form of registration. The applicants’ case was ‘all or nothing’; that is, they submitted that the five facts were sufficient to show that the whole of the land of the two communities was exempt. It was not submitted that some proportion other than that fixed by the Commissioner should be adopted.
[32]See the judgment of Kennedy JA [110].

We consider that each of the five facts is relevant to the determination of whether the relevant land was exempt under s 77(1), including the absence of inconsistent use. In particular, in our view, the construction of a UMD on a site is not inconsistent with the use of that site as a registered caravan park. The presence of long-term dwellings in a Part 4A park is part of the definition of a ‘Part 4A park’.[33] The construction of a UMD on a particular site on the land facilitates the use of the land as a Part 4A park and is an aspect of, or ancillary to, that use. The building of a UMD on a site is integrated into the business of operating a Part 4A park. Registration was applied for in respect of the Lifestyle Lyndarum and Lifestyle Geelong communities on the basis that they would contain 155 and 165 long-term sites, respectively.[34] Development was to occur in stages through the construction of the ‘homes’.[35]
[33]See [8] above.
[34]See the evidence of Kelly described at [14] and [16] above.
[35]See [10] above.

We do not consider, however, that the five facts are sufficient to attract the exemption for the whole of the land. We accept that, upon the uncontested facts, as at the relevant time, the land had been acquired for use as a caravan park, and was registered and operating as such, in circumstances where there was no competing or inconsistent use.[36] If it were not for the need to consider an apportionment of the land, under s 77(3), these matters might be all that is needed to render the whole of the land exempt. However, as discussed above,[37] the words of s 77(3) direct that an apportionment be carried out and this exercise must occur by reference to s 77(1), namely, that the exemption applies only in respect of those parts of the land that, at the relevant time, are used as a registered caravan park. An argument based on augmented registration does not grapple with the need for evidence of what use is being made of each part of the land at the relevant time.
[36]See judgment of Kennedy JA [174].
[37]See [24]–[26] above.

We consider that the authority relied on by the applicants, Eaton & Sons Pty Ltd v Warringah Shire Council (‘Eaton’),[38] should be distinguished. In Eaton the High Court held that the whole of an area of land may be ‘used’ for a particular purpose although only part of it was physically used for that purpose. It is distinguishable on the basis that it was a different statutory context, namely a planning scheme ordinance protecting the existing use of land and not an exemption from taxation, and the issue related to the purpose for which the land was used. It was also recognised that much would turn on the nature of the particular use claimed, the type of business, and the specific circumstances. Moreover, although the timber selling yard was divided into lots, at the relevant date physical operations were carried on beyond the fence that indicated the relevant boundary. Further, the clearance of the unused portion ‘was not a matter of difficulty or likely to occupy much time. It might well be said that there was no point in clearing it … until actual physical use was imminent’.[39] This is far removed from the circumstances here.
[38](1972) 129 CLR 270; [1972] HCA 33.
[39]Ibid 275 (Barwick CJ).

We consider that the construction of s 77(1) urged upon this Court by the applicants should be rejected.

The Commissioner, in this Court, concedes, as mentioned,[40] that his application of the exemption only to that proportion of the land on which a UMD had reached the ‘frame stage’ level of development was arbitrary, but he nevertheless considers it to be beneficial to the applicants. He accepts that all of the communal facilities are exempt. He does not urge the adoption of the criterion of ‘frame stage’ as a principled understanding of s 77(1). He submits that the primary judge should have accepted that land that is in the process of being developed, or is yet to be developed so as to enable it to be used for a purpose, is not land that is used in the relevant manner to attract the exemption.
[40]See [30] above.

He submits that land that is under or awaiting development as a Part 4A park is not used as a registered caravan park. The meaning of ‘developed’ or ‘development’ in this context is equivocal. However, the Commissioner took the view that land that is either in the process of having Part 4A dwellings built on it, or which has been set aside for that future purpose, is not used as a registered caravan park. Part of the land was being enabled for future use as a caravan park and not for immediate occupancy. It may be debatable whether the Commissioner regarded the building of Part 4A dwellings on sites as amounting to inconsistent use.[41] In any event, we have rejected the submission that the building of a Part 4A dwelling on the site where it is likely to stay for a substantial time is inconsistent use.[42]
[41]Cf judgment of Kennedy JA [151].
[42]See [39] above.

The Commissioner seeks to apply the reasoning of Nettle JA in Applewood (with whom Chernov and Redlich JJA agreed) to the effect that land set aside for development as a retirement village, but not yet developed, is not ‘used and occupied as a retirement village’ within the meaning of the equivalent relevant exemption under the Land Tax Act 1958.[43] He submits that this reasoning can be applied to s 77(1) despite the absence of the reference to ‘and occupied’ in that sub-section.
[43]See [32] above.

The Commissioner draws attention to the stages represented on the plans (Annexures A and C) where no dwellings had been built or where they were built in part. He relies on the aerial photographs Kelly exhibited (Annexures B and D) as showing that there were areas, particularly parts of Stages 2 and 3, where the civil works that were needed for those parts of the land to be used as a registered caravan park for UMDs had not been completed. He submits that in those areas there was a lack of evidence of roads, sewerage, gas, electricity, water connections and so on. He submits that an absence of that basic infrastructure would preclude those parts of the land from satisfying the test under s 77(1) of being used as a registered caravan park in respect of ‘Part 4A dwellings’.

In our view, the Commissioner was wrong to seek to apply the reasoning in Applewood directly. Not only is the wording of the relevant exemption in Applewood and s 77(1) relevantly different, there being no reference to ‘and occupied’ in s 77(1), but there are also important differences in the character of retirement villages from caravan parks.

Unlike the units in a retirement village, the essence of a ‘caravan’, whether registrable or unregistrable, is that it is movable. A caravan may be present in a caravan park on one day but not so on another. This feature renders land in an empty (but operational) caravan park nevertheless land that is used as a caravan park. An empty, or near-empty, registered caravan park in the midst of winter in regional Victoria does not prevent that land being used as a registered caravan park throughout that period.

In our view, with one proviso, land that is set aside for use by caravans, that is, movable dwellings, is land that is used as a caravan park. The proviso is that the land must be available to be so used. Ultimately, the positive submission of the Commissioner in this Court on the construction of s 77(1) reflects this approach; in the Commissioner’s view ‘what amounts to using land as a caravan park, is enabling people to occupy it — that’s the use’.[44]
[44]At times the Commissioner also appeared to submit that it was the capacity for occupation by residents; the reference to ‘occupation’ gives rise to the difficulty that it invites an evaluation of whether a dwelling constructed on land is yet habitable.

Intended scope of the exemption

In ascertaining the scope of the exemption under s 77(1) it is important to recognise the distinctive features of caravans and caravan parks and take account of the relevant statutory definitions in the LTA. As described above,[45] the definition of ‘caravan’ encompasses both registrable and unregistrable ‘movable dwellings’. They must be capable of being ‘situated at’ or ‘removed from’ a site within 24 hours. Caravan parks are areas of land on which movable dwellings are ‘situated’. ‘Situated’ is an awkward word grammatically but no doubt it was chosen as a contrast to ‘occupy’ or ‘inhabit’ which, as discussed,[46] is linked to the use of a dwelling and not the use of land. With this limitation in mind, the use of land as a caravan park means the use of land for ‘situating’ (or locating) movable dwellings. In a context where, as here, the relevant land is registered and operating as a caravan park, in our view the key question is: ‘As at the relevant date, on what part of the land could movable dwellings be situated?’ That part of the land together with those parts of the land used for supporting communal infrastructure are exempt from land tax under s 77. Those parts of the land were being used as a registered caravan park at the relevant date.
[45]See [7]–[8] above.
[46]See [21] above.

The key question is to be answered by reference to the circumstances that exist on the date relevant to the land tax assessment. It is also to be answered by reference to the type of registration the land has been applied for and granted as a caravan park; in particular, whether the registration is for registrable (traditional) or unregistrable (Part 4A) movable dwellings.

Answering the key question will depend upon an assessment of whether, at the relevant time, the necessary civil works had been completed to render the land available to be relevantly used.

The evidence of Kelly was that the development of the Lifestyle Lyndarum and Lifestyle Geelong communities took place progressively, in stages. In particular, civil works were carried out in stages. The civil works include digging, building roads, sewerage and drainage systems, and trenches for water and electricity.[47] The site agreement for each resident indicates that various services would be supplied to each residential site including electricity, water, sewerage and drainage services. Utility charges would be imposed monthly. The calculation was to be based on the resident’s meter for electricity and water, and, in respect of sewerage and draining services, calculated from the resident’s water usage.
[47]See [10] above.

The civil works necessary for Stage 1 were completed before construction began on the UMDs in Stage 2, and so on. The question of the extent to which civil works had been completed was an issue raised by the judge at trial and ultimately it appeared to be accepted by the applicants that the evidence of Kelly indicated that there were still uncompleted civil works at least for Stage 3 and that there was no certainty about how much of the civil works overall had been completed.

Recognising that s 77(1) applies to both traditional caravan parks (where registrable movable dwellings may be situated) and Part 4A parks (where Part 4A dwellings may be situated) will mean that, while the key question remains the same, the nature and extent of the civil works necessary to answer the key question will be relative to the type of caravan park in issue.

We consider that the Commissioner was correct to emphasise that the application of s 77(1), in the circumstances where Lifestyle Lyndarum and Lifestyle Geelong are registered and operating as caravan parks, will depend upon how much of the necessary civil works had been completed as at 31 December 2015 to render the land available for use as a registered caravan park in accordance with the appropriate registration. The evidence relied upon by the applicants before VCAT left that issue in a state of uncertainty.

In oral submissions in support of the cross-appeal,[48] the Commissioner emphasises that the applicants carried the onus to prove their case, pursuant to s 110 of the TAA, which provides: ‘On a review or an appeal, the taxpayer has the onus of proving the taxpayer’s case’. Section 109(a) relevantly provides that on a review or an appeal, the taxpayer’s case is limited to the grounds of the objection unless the Tribunal or Court otherwise orders. As mentioned, the applicants chose to present their case as an ‘all or nothing’ matter; the whole of the land was exempt or none of it was. The Commissioner submits that, if this Court determines that the exemption only applies to part of the land, whatever construction of s 77 it ultimately adopts, the applicants ought fail because they have not discharged their onus. We agree. For the reasons above, we are not persuaded that the whole of the land was exempt. The evidence adduced by the applicants left the answer to the key question we have identified in a state of uncertainty.
[48]See judgment of Kennedy JA [137].

We consider that the appropriate course is to conclude that the applicants have not discharged the onus they carry under s 110 of the TAA of proving that the land was used in a manner that attracts the exemption under s 77(1). This leaves applicable the proportionate exemptions that VCAT ordered the Commissioner to make. We would make the orders we have described above. [49]
[49]See [5] above.

---

Annexure A

Annexure B

Annexure C

Annexure D

KENNEDY JA:

This appeal raises the proper construction of an exemption contained in s 77 of the Land Tax Act 2005 (‘the Act’).[50] More particularly, the appeal raises an issue as to whether land was ‘used as a registered caravan park’ where the applicants registered a caravan park, and commenced operations, but where not every site was occupied by a caravan at the relevant time.
[50]The parties relied on the Land Tax Act 2005, as at 30 June 2015 (version no. 52) as applicable at the relevant time.

For reasons expressed below, I respectfully disagree with the construction adopted by the majority and consider that the full exemption should apply.

Background facts[51]

[51]Save where indicated, this summary of the facts is substantially reproduced from the ‘Agreed Summary for the Court’ dated 6 November 2020, signed on behalf of both parties.

The applicants, under the name Lifestyle Communities, own and operate registered caravan parks in Victoria.

This proceeding concerns two such registered caravan parks, Lifestyle Lyndarum (Wollert) at 150 De Rossi Boulevard, Wollert and Lifestyle Geelong (Bell Park) at 28–36 Barton Street, Bell Park.

Section 77 of the Act provided for an exemption from land tax for land or a part of land that is used as a ‘registered caravan park’, meaning ‘a caravan park within the meaning of the Residential Tenancies Act 1997 that is registered in accordance with regulations made under section 515 of that Act’.

Each parcel of land in question was acquired by the applicants in June 2014, for development and use as a registered caravan park.

Each parcel of land was then developed into a caravan park. Lifestyle Lyndarum contained 155 sites for occupation, and Lifestyle Geelong contained 165 sites for occupation. Each caravan park also contained a clubhouse, tennis court, lawn-bowling green and various other areas.

In 2015, each parcel was registered as a caravan park under the Residential Tenancies (Caravan Parks and Movable Dwellings Registration and Standards) Regulations 2010 (‘the Regulations’). Those regulations set safety and amenity standards for caravan parks in Victoria. The certificates of registration in each case recited that the Council was satisfied that the caravan park complied with the Regulations.[52]
[52]The certificates were in evidence.

By 31 December 2015, being the relevant date for the 2016 land tax year, Lifestyle Lyndarum and Lifestyle Geelong had commenced business as registered caravan parks. In each case, some of the sites were occupied by movable dwellings, further sites were being taken up progressively, and the applicants submit that residents were using the clubhouse and other areas. The residents, who were mostly retirees, owned the movable dwellings and took long-term leases of the sites.

In early 2016, the respondent made a land tax assessment for that year that assessed Lifestyle Lyndarum and Lifestyle Geelong as wholly not exempt. The applicants objected under Pt 10 of the Taxation Administration Act 1997. In May 2017, the respondent determined that Lifestyle Lyndarum was wholly exempt under s 77 of the Act, but that only 47% of Lifestyle Geelong was exempt on the basis that only that part of the land was registered as a caravan park (a revised certificate of registration was subsequently issued by the City of Greater Geelong confirming registration and approval for all 165 sites with effect from 25 November 2015).

The matter was then referred to the Victorian Civil and Administrative Tribunal (‘the Tribunal’) at the applicants’ request.

Before the Tribunal, the respondent was given leave to contend that Lifestyle Lyndarum was 51% exempt and Lifestyle Geelong was 47% exempt on the ground that, following Applewood Residential Developments Pty Ltd v Commissioner of State Revenue (‘Applewood’),[53] only parts of the land were being used as a registered caravan park. These calculations were designed to exclude that part of the land where a dwelling had not yet been installed and were based on the percentage of the land that was, at least, at ‘frame stage’.
[53][2006] VSCA 207.

The Tribunal upheld that submission and made orders accordingly.

The applicants appealed to a judge in the Trial Division on a question of law under s 148 of the Victorian Civil and Administrative Tribunal Act 1998. They contended that the Tribunal had misconstrued the exemption. They contended primarily that the Tribunal should have concluded that the whole of each parcel of land was used as a registered caravan park, or alternatively that the matter should be remitted to the Tribunal for rehearing.

The primary judge rejected the applicants’ ‘primary case’ and upheld the applicants’ ‘alternative case’.[54] Her Honour held that the Tribunal had not completed the necessary task of construing and applying the expression ‘used as a registered caravan park’, including by making factual findings that were relevant on the proper construction of the statute.
[54]Lifestyle Investments 1 Pty Ltd v Commissioner of State Revenue [2020] VSC 397 (‘Reasons’).

Her Honour reasoned that, on the facts found by the Tribunal, it was not possible to say whether or not the whole of each land was in fact used as a registered caravan park. Her Honour ordered on 14 July 2020 that the Tribunal’s orders be set aside and that the matter be remitted to the Tribunal with the hearing of further evidence.

The applicants challenge that order. In their amended notice of appeal, they allege that the primary judge erroneously construed s 77 by reference to a test of ‘present availability for occupation.’ They maintain that the whole of each parcel of land was ‘used as a registered caravan park’ within the proper construction of the exemption. This was on the basis of ‘five facts’ as will be detailed below. The notice further stated:

In particular, the judge misunderstood the full import of registration in the characterisation of the use of the land and, largely as a result, wrongly left open as a relevant possibility that the land was ‘still under development’ such that some sites were not ‘presently available for occupation’ and therefore not used as a registered caravan park within the meaning of s 77 of the Land Tax Act.

The respondent cross-appeals, seeking orders restoring the Tribunal’s decision to the effect that only part of each land was exempt. In the first proposed ground the respondent alleges that the primary judge should have concluded that land upon which dwellings were ‘under construction or to be constructed’ was not relevantly used as a registered caravan park for the purposes of s 77. The respondent claims that the primary judge failed to apply the distinction recognised in Applewood between land set aside for a purpose and intentionally left vacant in furtherance of that purpose, and land that is ‘in the process of being developed or is yet to be developed’. An alternative second proposed ground was that, even if her Honour’s construction was correct, the applicants had not discharged their burden of proof in proving that the land was so used. Therefore, the Tribunal’s decision should stand without the need for a remittal.

Relevant statutory provisions

Pursuant to s 7 of the Act, land tax is imposed in respect of each year on all taxable land in Victoria. Taxable land means land that is not exempt land.[55] Subject to the Act, a taxpayer is also to be assessed on the total taxable value of all taxable land of which the taxpayer was the owner as at midnight on 31 December immediately preceding that tax year.[56] It follows that the relevant date in terms of this application is 31 December 2015.
[55]Land Tax Act 2005 s 3(1) (definition of ‘taxable land’).
[56]Ibid s 36(1).

Part 4 makes provision for exemptions from land tax. The relevant exemption in this proceeding is contained in Div 5 which concerns ‘Accommodation.’ It includes exemptions for ‘rooming houses’ (s 75); residential care facilities (s 76); residential services for those with disabilities (s 76A); as well as retirement villages (s 78). The apparent purpose of the division is directed towards benign treatment of lower cost residential accommodation and care facilities.

The relevant exemption in this case is provided for by s 77 which provides:

77 Caravan parks
(1)Land is exempt land if the Commissioner determines that it is used as a registered caravan park.
(2)To obtain an exemption from land tax under this section, the owner of the land must—
(a) apply to the Commissioner for the exemption; and
(b)give the Commissioner any information the Commissioner requests for the purpose of enabling the Commissioner to determine whether the land is exempt under this section.

(3)If the Commissioner is satisfied that only a part of land is used as a registered caravan park—
(a)land tax is assessable on the remaining part of the land, unless another exemption applies to that part; and

(b) section 22 applies, if necessary, for that purpose.

(4) In this section—
‘registered caravan park’ means a caravan park within the meaning of the Residential Tenancies Act 1997 that is registered in accordance with regulations made under section 515 of that Act.[57]

[57]Emphasis added.

In s 77(1), the critical concept of ‘used as’ is utilised in relation to the concept of a ‘registered caravan park.’ Pursuant to s 77(4) a ‘registered caravan park’ is then defined by reference to the concept of a ‘caravan park’ within the meaning of the Residential Tenancies Act1997 (‘the RTA’) that is registered in accordance with the Regulations.

Under the definitions contained in s 3(1) of the RTA, a ‘caravan park’ is defined as ‘an area of land on which moveable dwellings are situated for occupation on payment of consideration, whether or not immoveable dwellings are also situated there.’ Section 3(1) also defines a ‘moveable dwelling’ as ‘a dwelling that is designed to be moveable, but does not include a dwelling that cannot be situated at and removed from a place within 24 hours’. A caravan park may also contain ‘common areas’ and ‘facilities’ as well as ‘camp sites’.[58]
[58]See, eg, Residential Tenancies Act 1997 ss 3(1) (definitions of ‘common area’ and ‘facilities’), 167(2), 177, 178, 206B(c); Residential Tenancies (Caravan Parks and Movable Dwellings Registration and Standards) Regulations 2010 reg 5 (definition of ‘camp site’).

The current proceeding was concerned with (non-registrable) moveable dwellings known as ‘Part 4A dwellings’ situated in what is known as a ‘Part 4A park’. Part 4A dwellings are purchased by site tenants for installation on a site which is rented under a ‘site agreement’. A Part 4A park is covered by its own specific regime under Pt 4A of the RTA, and concerns an area of land where sites are available for occupation under a site agreement and where Part 4A dwellings ‘may be situated’.[59] A Part 4A park (which includes a caravan park that contains Part 4A sites) may come into existence prior to the installation of any Part 4A dwellings — which are not fixtures.[60] This is reinforced by s 206ZS which provides for a ‘site owner’ to give a ‘site tenant’ a ‘plan’ of the Part 4A park that identifies the site on which the tenant’s Part 4A dwelling ‘is or is to be situated’.[61]
[59]Residential Tenancies Act 1997 s 3(1) (definition of ‘Part 4A park’) (emphasis added): Part 4A park means an area of land where — (a) sites of land are available for occupation under a site agreement; and (b) Part 4A dwellings may be situated on those sites; and (c) common areas or facilities are available for the use of a person occupying a Part 4A site — and includes a caravan park if the caravan park contains Part 4A sites.
[60]Ibid s 206C.
[61]Emphasis added. See also s 3(1) definition of ‘site owner’ which encompasses a person by whom a Part 4A site ‘is to be let.’

Importantly, however, the concept of a ‘caravan park’, under s 77 does not distinguish between a traditional caravan park and a Part 4A park. The exemption in s 77 of the Act (which was introduced in 2005, as an amendment to the Land Tax Act 1958) also predates Pt 4A of the RTA (which was introduced in 2010).

Both types of ‘caravan park’ are regulated by the Regulations. More specifically, the Regulations include provision for registration of caravan parks, standards of design and installation of movable dwellings in caravan parks, as well as standards for facilities and services in caravan parks.[62]
[62]Residential Tenancies (Caravan Parks and Movable Dwellings Registration and Standards) Regulations 2010 regs 1(a)–(c).

Regulations 10 and 11 are contained in Pt 2 of the Regulations, which deals with registration. They read as follows:

10 Requirement to register
A person must not operate a caravan park unless the caravan park is registered under these Regulations.
Penalty: 20 penalty units.

11 Application for registration
(1) An application for registration must be lodged with the council.

(2) The application for registration must—
(a) be in the form of Form 1 in Schedule 1; and
(b) include a plan of the caravan park clearly indicating the location and number of all buildings and facilities and all long term sites, short term sites and camp sites; and
(c) include the most recent report given to the applicant by the relevant fire authority; and
(d) include the schedule of works for the caravan park, if any, and evidence of the status of compliance with the schedule of works; and
(e) include the emergency management plan for the caravan park; and
(f) be accompanied by the registration application fee determined in accordance with regulation 17.

Regulation 10 focuses attention on the person who is to ‘operate’ a caravan park. This is consistent with the definition of a ‘caravan park owner’ which means ‘any person who is (either wholly or partly) the owner of a business which operates [the area of land described as] a caravan park’.[63] It is also consistent with other parts of the legislative scheme which regulate the circumstances in which a caravan park owner can ‘operate’, or commence ‘operation’ of a caravan park.[64]
[63]Residential Tenancies Act 1997 s 3(1) (definition of ‘caravan park owner’) (emphasis added).
[64]See, eg, Residential Tenancies Act 1997 s 518D; Residential Tenancies (Caravan Parks and Movable Dwellings Registration and Standards) Regulations 2010 regs 20(2)(a), 21(2)(a), 32A(a).

Form 1 (contained in sch 1 to the Regulations) makes provision for the caravan park owner to adduce evidence of the plan of the caravan park, the most recent report from the relevant fire authority, and the emergency management plan. It further includes provision for the owner to identify the number of long term sites, short term sites, and camp sites. Thus, in the present case, the registration certificate concerning Lifestyle Geelong records that the caravan park has 165 long term sites.

The concept of a ‘camp site’ means a site that is not provided with individual electrical power or other individual site services, used for placement of a tent or motor vehicle.[65] However, there is nothing to suggest that individual site services are necessarily provided to any other site in a caravan park. Thus, although the RTA makes a caravan park owner liable for installation costs of electricity, water or gas services, this is only in respect of the initial connection of any such services.[66]
[65]Residential Tenancies (Caravan Parks and Movable Dwellings Registration and Standards) Regulations 2010 reg 5 (definition of ‘camp site’).
[66]Residential Tenancies Act 1997 ss 163, 206ZF.

The concept of a ‘site’ is simply defined in the RTA as a ‘site in a caravan park’.[67] However, the relevant definitions contained in reg 5 are as follows:
[67]Ibid s 3(1) (definition of ‘site’).

site means a site within the caravan park for use by a movable dwelling;
short term site—
(a) means a site in a caravan park designed for a movable dwelling and intended for use by a short term occupier; and

(b) does not include a camp site;

long term site means a site in a caravan park designed for a movable dwelling and intended for use by a resident.

These definitions thereby focus attention on the design of the site as evident in the plan, rather than the particular state of the site itself.

Nevertheless, the legislative scheme does regulate the requisite state of the site necessary in order to obtain registration. Thus, reg 13(1) provides that the Council must grant registration ‘if satisfied that the caravan park complies with these Regulations’. In determining an application for registration, the Council must also have regard to the matters specified in reg 13(3) as follows:
(a)the most recent report of the relevant fire authority in respect of the caravan park; and
(b)the status of compliance of the applicant with the schedule of works for the caravan park, if any; and
(c)whether or not the emergency management plan for the caravan park complies with regulation 22; and
(d) whether or not the caravan park complies with Part 3; and
(e)the applicant's record of compliance with these Regulations and any orders issued under the [RTA].
The ‘schedule of works’ cited in reg 13(3)(b) is defined as a written agreement entered into between a caravan park owner and a local council setting out works to be undertaken to comply with the relevant standards outlined in regs 20 and 21 (relating to fire prevention) as well as Div 2 of Pt 3 of the Regulations (other than reg 31).[68] The certificates of registration do not suggest that registration was subject to the completion of any schedule of works in this case.
[68]Residential Tenancies (Caravan Parks and Movable Dwellings Registration and Standards) Regulations 2010 reg 7.

Part 3 sets standards applicable for registration of caravan parks. Division 2 of Pt 3 sets standards for amenities relating to water supply, sewage and waste water, sanitary facilities, laundry facilities, garbage bins, and lighting. Regulation 32A also provides that a caravan park owner must comply with the division before commencing operation of the caravan park (in the case of a new caravan park).[69]
[69]Ibid reg 32A. Regs 20(2)(a) and 21(2)(a) contain a similar requirement.

Registration lasts for at most three years and is renewable under a similar certification process.[70]
[70]Ibid regs 12–14.

There is no requirement that any moveable dwelling be actually installed on a site prior to registration of land as a caravan park. This is made even clearer by Div 3 of Pt 3 of the Regulations which provides for separate standards for dwellings which are installed in a caravan park.[71] It is even possible that there be new sites added to an existing caravan park.[72]
[71]See, eg, Residential Tenancies (Caravan Parks and Movable Dwellings Registration and Standards) Regulations 2010 regs 33, 39–41.
[72]Ibid, see regs 20(2)(b), 21(2)(b).

The concept of a ‘caravan park’ thereby embraces land on which moveable dwellings are situated, as well as land where it is intended that they be situated. This appeared to be accepted by the respondent given he accepted that an empty caravan park in July and a site ready for a Part 4A dwelling would be nonetheless ‘used as’ a caravan park. The land however must be in a sufficiently advanced state to meet the relevant standards specified in the Regulations in order for that caravan park to be registered.

Primary judge’s reasons

After setting out the relevant background, including the statutory framework, the primary judge extracted certain factual findings from the reasons of the Tribunal which included:

13Lifestyle Geelong and Lifestyle Lyndarum are two ‘lifestyle’ residential communities owned and operated by the LC Group. The structure of the communities operated by the LC Group are that:
[a] resident buys a home and a share of the community infrastructure and then rents a particular site in the community for it. The home is bought under a ‘Home Purchase Agreement’. … The lease of a particular site occurs under a ‘Residential Site Agreement’. Each lease is for 90 years. The residents obviously also get the use of common areas of the community.

14The ‘homes’ to which reference is made are ‘unregistrable moveable dwellings’ as defined in the Residential Tenancies Act 1997, and include carports and garden areas.
15The residents who live in the communities are ‘permanent residents, not tourists like in tourist or camping parks’. Mr Kelly says that the residents are ‘overwhelmingly retirees’, however he conceded in cross-examination that the communities were open to anyone aged 50 or more, and that the marketing was not limited to retirees.
16Both Lifestyle Geelong and Lifestyle Lyndarum were developed on a staged basis.
17Mr Kelly attached a site plan for Lifestyle Lyndarum to his witness statement. This shows that the entire community was intended to have 155 caravan sites and was to be developed in 3 stages. As at 31 December 2015, stage 1 - which comprised 48 sites and the community infrastructure (a club house, tennis court and lawn bowls field) — was largely completed. Homes had been built on all sites and most had settled and were presumably occupied. Stage 2 comprised 40 sites, of which one was built and 13 were at frame stage. Stage 3, which comprised 67 sites, was still under development.
18Similarly, Mr Kelly attached a site plan for Lifestyle Geelong to his witness statement. This shows that the entire community was intended to have 165 caravan sites and was to be developed in 3 stages. As at 31 December 2015, stage 1 - which comprised 52 sites and the community infrastructure (a club house, tennis court and lawn bowls field) — was largely completed. Homes had been built on all but nine sites (which were still at frame stage) and 17 had settled (and were likely occupied). Stage 2 (which comprised 62 sites) and stage 3 (which comprised 51 sites) were still under development.

Her Honour identified three questions on the appeal: first, on a proper construction, what constitutes the use of land as a ‘registered caravan park’?; secondly, was it open for the Tribunal to find as it did given all of the land was a caravan park within the meaning of the RTA that was registered?; thirdly, was it open for the Tribunal to find as it did given various factual matters (which she described as the applicants’ ‘alternative case’)?

Dealing with the question of proper construction, the primary judge considered the concept of ‘use’ and said as follows:

45The word ‘use’ (or ‘used’) is protean in its content, and when employed in connection with land, is an expression of wide import. Accordingly, its meaning will depend heavily upon its statutory context and in determining what suffices for use of land in a given case regard must be had to the purpose to which land is to be put.[73]

[73]Reasons [45] (citations omitted).

Her Honour also cited what Mahoney JA said in Macquarie University v Ryde Municipal Council to the effect that the heart of the term ‘use’ lies in the notion of the thing in question ‘being employed or availed of’.[74]
[74][1977] 1 NSWLR 304, 313–4.

In order to construe the meaning of ‘use’ in the particular context of ‘use as a registered caravan park’, her Honour went on to consider the various definitions of ‘caravan park’ and ‘Part 4A park’, with particular emphasis on the definitions concerning Part 4A parks. Having regard to these definitions, she considered that ‘the essence of use of land as a registered caravan park, then, is the present availability of land for occupation by site tenants or residents, and the related availability of common areas and facilities for the use of site tenants or residents.’[75] The Reasons then read:

65 The Appellants submitted that the criterion for the exemption is the use of land; not the occupation, or, ‘use and occupation’ of land. That is true as far as it goes, but in construing the statutory criterion one must ask how it is that the statute requires that land must be availed of or employed. In this case, it must be used as a registered caravan park. Use in that way requires that sites within the land be able, presently, to be let to tenants for occupation, and common areas and facilities made available, presently, for their use.
66 Both parties accepted, as do I, that relevant use of the land may be use by an owner or operator of a caravan park, or by a resident. There is nothing in the language of s 77 of the Land Tax Act to suggest that it must be one or the other. A resident may use land within a caravan park by occupying a dwelling situated on it, or by using common areas or facilities. A caravan park owner may use it by making land within the caravan park available for occupation.
67 To elaborate, a site within a Part 4A park which is occupied by Part 4A dwelling which is let to a site tenant, is relevantly used — at least by the tenant. A site within a Part 4A park which is presently available for occupation under a site agreement (although unoccupied by a dwelling or unlet) is relevantly used — by the owner, who is making it available for occupation. Common areas or facilities that are presently available for use by persons occupying sites within the park are being relevantly used. There may be other parts of the land that are used by the caravan park operator in the course of operating the caravan park.
68This construction accommodates fluctuating levels of occupancy, including periods of vacancy, that are an inherent characteristic of caravan parks.[76]

[75]Ibid [64].

[76]Ibid [65]–[68] (emphasis in original).

Her Honour further considered that the fact that s 77 designated use as a ‘registered caravan park’ did not alter her conclusion in any way, noting that the applicants’ construction (that registration was paramount) did not give work to the expression ‘used as’.[77]
[77]Ibid [73]–[86], especially [75].

Her Honour further found that, although the reasoning in Applewood was instructive, this did not alter the fact that the authority did not construe the actual provision in issue in this case.[78] However, she did consider that the analysis in Applewood concerning the construction of the apportionment provision in that case (s 9(2AB) of the Land Tax Act 1958 as then in force) could be applied by analogy for the purpose of construing the effect of s 77(3). In each case the provision serves the function of expressly permitting the part assessment of land for land tax, and also provided the means of that assessment.[79]
[78]Ibid [98].
[79]Ibid [99]–[100].

She concluded that the Tribunal correctly construed s 77(3) as contemplating that some part, but not all, of the land which forms part of a registered caravan park may be used as such, and that the Tribunal was not in error in holding that s 77(3) permitted the respondent to apportion land comprising the registered caravan park.[80] The applicants’ primary case, the subject of question 1 was therefore rejected.
[80]Ibid [107]–[108].

Given her Honour’s finding that registration was not sufficient of itself, she further found that question 2 should be answered ‘yes’ on the basis that it was open to the Tribunal to find that each (wholly registered) land was not wholly used as a registered caravan park.[81]
[81]Ibid [123]–[124].

However, in relation to question 3, she considered that the Tribunal did not complete the task of identifying the statutory test in relation to s 77(1).[82] Where the statutory construction task was not completed and factual findings that would have been relevant on the proper construction of the statute were not made, it was not possible for the Court to decide on the undisputed evidence that there was only one right answer open to the Tribunal. Rather, her Honour identified a number of factual matters that may have been relevant, but were not satisfactorily dealt with. Such matters were largely focused on the perspective of tenants and included the terms of site agreements;[83] who was occupying land where works were occurring;[84] an analysis of the rights of occupancy conferred under the site agreements;[85] and whether future residents had rights of occupancy while dwellings were built.[86] Had the Tribunal completed its task it might have evaluated the evidence differently. Given that it did not complete the task, this was a vitiating error in relation to the applicants’ alternative case as set out in question 3.[87]
[82]Ibid [109], [113].
[83]Ibid [70], [138].
[84]Ibid [70].
[85]Ibid [138].
[86]Ibid [139].
[87]Ibid [151].

Her Honour considered that it was not generally appropriate for her to substitute any decision for the Tribunal’s decision unless on unchallenged evidence it was the only decision available to the Tribunal as a matter of law. Given her role was not to embark upon the exercise of resolving ‘disputed questions of fact’, she did not consider herself to be in a position to dispose of the matter.[88] She thereby allowed the appeal, but ordered that the Tribunal’s order be set aside and that the matter be remitted for rehearing.
[88]Ibid [153].

Parties’ submissions

Applicants’ submissions

The applicants submitted that there should be a distinction drawn between s 77 and other exemption provisions where the draftsperson had taken care to narrow the exemption to land that was ‘occupied’ or ‘used and occupied’ or ‘currently available for occupation’.[89] Section 77 could easily have said ‘presently’ or ‘currently available for occupation’ if that had been intended as the test. The choice of language in s 77 must reflect a deliberate choice by Parliament indicating that the concept of ‘use’ does not turn on concepts of occupation. The applicants’ central proposition was therefore that use as a ‘registered caravan park’ did not require immediate physical occupation, or availability for occupation, of every part of the land.
[89]Land Tax Act 2005 ss 54(1), 75(1), 76(1), 76A(1), 78(1). The applicants also emphasised that the definition of ‘retirement village’ in s 78(3) further explicitly imported concepts of occupancy.

The applicants emphasized that the concept of ‘use of land’ in s 77 of the Act was also defined by reference to the registration scheme under the RTA and the Regulations. That scheme prescribed detailed standards and requirements for caravan parks in order to obtain and keep registration. Installation of moveable dwellings is not a touchstone of use as a registered caravan park within the meaning of s 77.

The applicants submitted that the concept of ‘use’ was met in this case by reason of five facts: first, the two parcels were acquired for development and use as registered caravan parks, with planning permission obtained accordingly; secondly, by December 2015 each land had been developed into a caravan park. Lifestyle Lyndarum contained 155 sites, and Lifestyle Geelong contained 165 sites. Each also contained various recreational facilities and amenities; thirdly, each caravan park was registered; fourthly, each had opened and commenced operating as a registered caravan park; and finally, each land was wholly devoted to the business of the caravan park owner, there being no competing use or purpose.

The applicants highlighted that s 77 was principally directed to use by the owner because the owner was the person on whom the liability was imposed. They highlighted that the definition of a ‘caravan park owner’ was a person who is the owner of a business which operates a caravan park. This thereby meant that the concept of use was necessarily connected to a registered caravan park that is ‘operated’ by an owner. Thus the concept applied to any use by the owner of the land as a registered caravan park which encompassed all the things that the owner and operator of a registered caravan park can do within the business.

The applicants conceded that land need not be taken to be used as a registered caravan park when it is registered. This was because it could be used for an independent purpose eg if used instead as a commercial car park or drive-in cinema. There could also be ‘non-use’, such that if the owner went out of business the exemption would not apply. In other words, the caravan park needed to be open and operational (as well as registered). However, any temporary restriction (such as a pool closed for repairs) did not stop the land being used as a registered caravan park.

The applicants emphasised that the definition in the Act did not distinguish between traditional caravan parks and Part 4A parks. The situation here was then no different to an owner registering a traditional caravan park which was only 25% occupied, and having varying degrees of occupation according to seasonal fluctuations. Although the primary judge endeavoured to accommodate this by the ‘present availability for occupation’ test, this was still wrongly focused given it focused on what tenants were doing on the land, rather than the concept of use as a registered caravan park in this legislative scheme.

Insofar as s 77(3) was concerned, it still required a decision as to what ‘use as a registered caravan park’ was as the apportionment provision repeats that same test. Simply because s 77(3) was there did not mean that there should be some further factual inquiry beyond the requirement otherwise contemplated.

The ‘under construction’ exemption in s 78A (which responded to Applewood) did not add meaningfully to the statutory construction of s 77, and, if anything, suggested that Parliament considered it unnecessary to provide for a similar exemption in respect of a registered caravan park because, once it was registered and used, it was inapt to talk about the land being ‘under construction’ for future use.

The applicants submitted that the primary judge placed too much emphasis on the definitions contained in Pt 4A of the RTA which post-dated s 77 of the Act. In any event, there was nothing in those definitions which was inconsistent with the applicants’ approach. The primary judge thus erred in adopting a test of ‘presently available for occupation’ which was not derived from, or supported by, the language of s 77. The Tribunal also used an incorrect test in adopting the respondent’s position whereby the exemption only applied to areas where the physical footprint of the moveable dwellings had been constructed to, at least, ‘frame stage’. This was an arbitrary measure.

The applicants also submitted that a general application of Applewood would involve an impermissible gloss on the text of s 77. The wording of the statutory exemption in Applewood was different, as was the subject matter. Thus, by 31 December 2015 the land was not ‘being constructed’ or being ‘prepared for future use’, rather it was validly registered and awaiting occupation by moveable dwellings and tenants. This case is concerned with the present use of an existing registered caravan park and the progressive installation of moveable dwellings within an existing registered caravan park. Secondly, the reasoning in Applewood is replete with references to the different test that the land be ‘used and occupied’. A more appropriate analogy could be drawn to Burwood Terrace Pty Ltd v Commissioner of State Revenue,[90] where a retirement village was completed but not yet fully occupied by residents. This was nonetheless considered ‘land used and occupied as a retirement village’. The primary judge correctly applied Applewood, insofar as it was ‘instructive’, and correctly distinguished the reasoning as not amounting to identification of the correct legal test under s 77.
[90][2002] VCAT 183. The applicants also cited Newcastle City Council v Royal Newcastle Hospital (1957) 96 CLR 493; [1957] HCA 15 (‘Newcastle’).

The applicants submitted that there was also High Court authority that supports the proposition that ‘unoccupied’ areas could nonetheless be ‘used’. Thus in Eaton & Sons Pty Ltd v Warringah Shire Council (‘Eaton’),[91] Barwick CJ explained that physical use ‘varies according to the exigencies of the business to whose purpose the land as a whole has been devoted’, and ‘land … kept vacant for use as the needs of a business demand is not of necessity properly designated … as land not in existing use but merely intended for future use. Much will depend on the extent of its integration with land in actual physical use and the nature of the business being conducted’.[92]
[91](1972) 129 CLR 270; [1972] HCA 33.
[92]Ibid 274 (Barwick CJ).

The applicants’ approach was supported by the width of the concept of ‘use’, the tests inherent in the process of registration, the stated purpose of the exemption (‘land tax exemption for private caravan parks’), the promotion of administrative certainty and convenience (without the need to ‘audit occupation’), the recognised need to encourage growth of residential villages as a means of addressing housing affordability issues, and the general approach by courts towards exemption or beneficial provisions.

It was sufficient to say that the exemption was broad enough to cover land that had been acquired for use as a registered caravan park, developed into a caravan park and registered as such, provided that the business is in fact operating and that the land was wholly devoted to that purpose.

In terms of the concept of ‘developed’, the applicants submitted that the fact of registration meant the caravan park must be taken to have been developed and registered as compliant with the Regulations. The references to ‘under development’ by the Tribunal addressed the progressive occupation of those sites by dwellings that had been constructed, and was not directed to the need for the land within stage 3 to be further developed to be a registered caravan park. Therefore, this was not ‘intended future use’ of the land. Rather, there was currently a registered caravan park that existed and was being ‘operated and used’ as such in its whole — not just those parts which were occupied. The possibility that some civil works were incomplete was immaterial because the works deemed essential to the use of the land as a registered caravan park were already complete given the registration.

As a ‘fall back’ alternative position, the applicants also relied on an additional ‘sixth matter’ which was evidence that the unoccupied sites were being availed of by residents of other sites for recreation, such as to walk their dogs. However, they accepted that this would not assist in relation to sites where dwellings were under construction.

The applicants also submitted that, regardless of the construction, a full exemption was the only correct outcome. Thus, it was said that the sites here were almost by definition ‘available for occupation’ on the judge’s own construction given the caravan park was registered in each case. If the perspective of the caravan park owner was embraced, then the owner had made the land available for occupation as raised by the primary judge (at paragraph 66). The fluctuating levels of occupancy raised by the primary judge also covered the filling of sites progressively as in the present case.

In oral exchange, the applicants were invited to address a scenario where part of the land was fenced off and used solely for the purposes of construction of dwellings. Senior Counsel suggested that this would probably not be covered by the exemption because one could not register a ‘caravan park’ covering such an area, although he ultimately suggested that this may be characterised as ancillary or incidental use. In any event, this did not arise here since the act of construction was essentially a more drawn out act of pitching a tent, and did not convert the site from being ‘presently available for occupation’ (even if, contrary to the primary submission, that was the test) to something not used as part of the registered caravan park. Counsel also later clarified that the construction of dwellings on a particular site (as here) would also fall within the notion of ancillary or incidental use, even if it is not directly characterised as use as a registered caravan park.

The applicants also submitted that if a full exemption was not the only correct outcome, given the ‘scant’ factual findings (as cited by the primary judge), it could not be said that there was no possibility of the applicants establishing that the whole of the land was used as a registered caravan park. It was not a matter of any failure by the applicants to discharge an onus of proof as there was evidence adduced about the use of the land. Rather, it would be a failure by the Tribunal to complete the statutory enquiry and perform its task by making sufficient factual findings. Given there was not only one decision open to the Tribunal as a matter of law, it was submitted that the primary judge was required to remit in such a case.

Respondent’s submissions

The respondent highlighted that there were three different constructions of s 77:

·the respondent’s construction, which relied primarily on an application of Applewood, that land under or awaiting ‘development’ was not used as a registered caravan park;
·the applicants’ construction where land acquired, developed and registered for use as a caravan park is exempt, provided the business is currently operating and the land is wholly devoted to that purpose;
·the construction favoured by the primary judge which focused on the ‘present availability of land for occupation’.

He submitted that use is ‘enabling people to occupy’ the land, and that the activity constituting the ‘use’ was people ‘being able to live on the land, in Part 4A dwellings’ and obtaining incidental uses such as the use of central facilities.

Senior Counsel agreed that the respondent’s test was ‘virtually the same’ as that of the primary judge, and would often result in the same conclusion when applied in practice. However, the primary judge’s test was insufficiently explicit that land ‘under construction or development’ to enable future use was not relevantly ‘used’. Her Honour had left open the possibility that land in the process of having Part 4A dwellings built on it, or which has been set aside for that future purpose, might be used as a registered caravan park. In doing so, her Honour had failed to correctly apply Applewood which distinguished between land set aside for a purpose (and intentionally left vacant in furtherance of that purpose), and land that is in the process of ‘being developed or is yet to be developed’ so as to enable its use for a purpose.

The respondent accepted that there were two relevant differences between this case and Applewood. First, the Applewood exemption provision (s 9(1)(j)) required that the land be ‘used and occupied’. Secondly, s 9(1)(j) required that the land be used for no other purpose. Still, the textual differences did not justify setting aside the reasoning, which remained applicable to land being developed in stages. Thus, the respondent emphasised the language of Nettle JA at paragraph 20 which focused on use (as opposed to use and occupation). Further, the requirement of ‘no other purpose’ in s 9(1)(j) assumed no importance here given no competing purpose was identified.

The respondent accepted that part of land not physically used by the owner may be used, if it is used in the manner intended by the owner, and has a sufficient relationship to that part of the land that is physically used. However, this description is not met if the land is under construction or being prepared for use in the fashion ultimately intended. Thus, the land may be exempt if deliberately left vacant to provide greater amenity (as in Newcastle City Council v Royal Newcastle Hospital (‘Newcastle’)[93]), but not if it is merely awaiting future construction. The applicants had made the same error as the taxpayers in Applewood: relying on disputed land being held for a particular purpose rather than establishing the relevant use.
[93](1957) 96 CLR 493; [1957] HCA 15.

The respondent submitted that his construction was consistent with the scheme of the Act in three ways. First, a separate exemption is available for some classes of land being prepared or being under construction, whereas there was no such equivalent for land used as a registered caravan park. The legislative choice should be given content. Secondly, the Act imposes land tax on an annual basis focusing on the state of land at a particular point in time. Finally, s 77(3) confirmed that a part of the land may be exempt where another part is not. The fact that it may be difficult to apply the law does not mean that it does not need to be applied.

The decision of Eaton was distinguishable, having been decided in a different statutory context (a planning context) and not being concerned with prior civil works or preparation of land. The case did not stand for some general rule that there is always present use if land is anticipated as being part of future use.

As indicated already, the respondent accepted that an empty traditional caravan park in July, or a site that was empty but ‘ready’ for a Part 4A dwelling, was nonetheless used as a caravan park. However, he claimed that anything prior to frame stage (which was taken as a ‘generous’ approach), was not ready for occupation but ‘ready to be made ready’ for occupation. He agreed that this meant that, at least, ‘civil works’ needed to be completed.

In oral submission, Senior Counsel highlighted that the disputed land fell into three categories: the first category where a site was the subject of a completed, or near completed, dwelling; a second category where houses were under construction; and a third category where the site was vacant. He suggested that the second category was not relevantly ‘used’ given the evidence was that it took three months (or 62 working days) to build a dwelling. Further, unlike a traditional caravan park, given the site was half-filled, a resident could not come along with their own Part 4A dwelling. The site was therefore being ‘used’ for constructing houses/dwellings. The third category was also not relevantly used because he claimed that the civil works required were not yet done eg sewerage, electricity, and gas lines etc. He invited the Court to examine the site map and photographs contained in the appeal book and suggested that the ‘top left area’ in particular showed nothing at all other than provision for a future roadway and some equipment. He suggested (by reference to the photograph) that this top left area was not a place where a person could place a dwelling — probably for months. He also suggested that this was consistent with certain evidence of Mr Kelly (the managing director of the applicants) who suggested that the civil works ran in stages.

The fact that the existing residents may have had an informal arrangement to obtain access to the undeveloped areas of the caravan park was not significant to the characterisation of the land for the reasons outlined by Nettle JA in Applewood (at paragraph 32). It followed that any site in either the second or third stage was not presently being used as a caravan park. The respondent also highlighted that at least part of the land was not even available for dog walking, namely, the sites where dwellings were under construction.

The respondent therefore stood by the ‘frame stage’ proportions (which had not been challenged) as correctly relied upon by the Tribunal.

The respondent also put an alternative case on his cross-appeal, emphasising that it was not open for her Honour to remit the matter to the Tribunal even if her construction was correct, in circumstances where the applicants had not discharged their onus of proof. Moreover, in oral submissions it was contended that, if there was any construction where part of the land was not exempt, the matter should not be remitted given the applicants had carried the onus of proof from the outset. Thus, the respondent submitted that it was for the applicants to lead evidence that land under construction or set aside for future development was either made available to traditional caravans or owners of Part 4A dwellings that could be constructed on site immediately, or in some other way used as intended. The applicants did not do this. Rather, they only led evidence of the land being used over a period of months for construction of dwellings to be purchased by residents, and of incidental dog walking. Therefore if not ‘all’ the land was exempt, then there should not be ‘another go’ at apportionment given the applicants carried the onus of proof and given they did not challenge the respondent’s calculations.

Analysis

Prior to resolution of the correct construction, it is necessary to further consider the decision in Applewood given the significance the respondent placed on it.

Applewood concerned whether land in Doncaster, which had been purchased for development as a retirement village, was exempt land by reason of s 9(1)(j) of the Land Tax Act 1958 as then in force. This section provided that ‘land which is used and occupied as a retirement village and for no other purpose’ was exempt land.[94] The concept of a ‘retirement village’ also had its own definition under s 3(1) as ‘a complex containing residential premises … predominantly or exclusively occupied by retired persons…’.[95]
[94]Emphasis added.
[95]Emphasis added.

The evidence was that the development was to proceed in 14 stages. At the relevant date, three stages were completed and occupied. It was agreed that these stages were exempt land. Of the remaining 11 stages (‘the disputed land’), two were under construction and nine were awaiting future development. Some services (ie sewerage, drainage and roads) had been provided to the disputed land, but it was fenced off from the occupied stages. The existing residents could access a number of the undeveloped stages pursuant to an informal arrangement.

The Court of Appeal agreed with the trial judge who found that the disputed land was not exempt land, emphasising that s 9(1)(j) required that exempt land be used and occupied as a retirement village, and not merely held for that purpose.[96] Nettle JA, as he then was (and with whom Chernov and Redlich JJA agreed), noted that the exemption provision must be read alongside s 9(2AB) which provided for apportionment in circumstances where the Commissioner is satisfied that part only of land is ‘used and occupied’ as a retirement village. He therefore considered that the exemption required a compartmentalised approach whereby parcels of land were broken down into components, and exemption afforded only for those components which were used and occupied for the specific purpose at the relevant time.[97]
[96]Applewood [2006] VSCA 207, [17].
[97]Ibid [16].

Nettle JA considered that partial completion did not characterise the disputed land as ‘used and occupied’ any more than a partially completed office block on part of land adjacent to a used and occupied office block would characterise the construction site as land used and occupied as an office block.[98]
[98]Ibid [18].

His Honour referred to Newcastle where land was set apart for a project and wholly devoted to that project, although not all land was physically used.[99] He further stated (in a passage highlighted by the respondent): ‘[c]ontrastingly, in a case like the present where the project is still being developed, the land on which the project is being developed is not being used for the purpose for which it will be used once it has been developed.’[100]
[99]Ibid [20]. Newcastle (1957) 96 CLR 493; [1957] HCA 15 concerned land owned by a public hospital, but fenced off and kept in its natural state in order to, inter alia, keep the atmosphere clear and unpolluted and provide quiet and serene surroundings for patients.
[100]Applewood [2006] VSCA 207, [20].

His Honour further commented that it might have been different if the residents of the completed sections had rights of use and occupation over the disputed land (ie as common areas). However, the fact that the residents had an informal arrangement to obtain access to some stages was not significant to the characterisation of the land.[101]
[101]Ibid [32].

Ultimately, while his Honour considered that the question of use and occupation is one of fact and degree, he concluded that ‘where a retirement village was being developed in discrete phases’ land would not qualify for an exemption unless residences were completed to the point that they are ‘available for use and occupation and at least one of them in that phase is in actual use and occupation by a resident.’[102]
[102]Ibid [33].

There are a number of features of the decision in Applewood which are significant. Thus, first, the statutory provision in that case was concerned with the concept of ‘used and occupied.’ Notwithstanding the passage identified by the respondent, this phrase clearly featured in his Honour’s reasoning. His Honour also made express reference to the importance of the specific language used as compared with other exemptions.[103] Secondly, the subject matter of Applewood was concerned with the concept of a ‘retirement village’ which had its own statutory definition and which required residences to be ‘occupied’. Thirdly, even to the extent that the passage relied upon (at paragraph 20) may suggest that land ‘under development’ is not relevantly ‘used’, it will be critical to characterise the relevant concept alleged to be ‘under development’ in order to consider whether that characterisation is appropriate. Thus, although a retirement village will be ‘under development’ where buildings are still under construction, a caravan park is a very different concept.
[103]Ibid [26].

Overall then, although, as observed by the primary judge, the decision is ‘instructive’, it is readily distinguishable, and certainly not determinative.

Returning, then, to the current legislative framework, the principles relevant to statutory construction were summarised by Kiefel CJ and Keane J in R v A2.[104] They require consideration by the Court of the ordinary and grammatical meaning of the words used, taking into account both context and legislative purpose.[105]
[104][2019] HCA 35, [31]–[37] (Kiefel CJ and Keane J).
[105]Victoria v Thompson (2019) 58 VR 583, 589 [27]–[28] (Beach, Osborn JJA and Kennedy AJA); [2019] VSCA 237.

Insofar as the word ‘use’ is concerned, I accept the general principles applying to that concept as summarised by the primary judge at paragraph 45. Thus, its meaning will depend heavily upon its statutory context which, in this case, includes reference to the concept of a ‘registered caravan park’ within the meaning of the RTA and the Regulations. It will therefore be impossible to say whether land is ‘used as’ a ‘registered caravan park’ unless the concept of a ’registered caravan park’ is correctly understood.

As highlighted above, there was really no dispute that a ‘caravan park’ did not require the actual installation of movable dwellings in order to be recognised as such. Rather, the concept of a ‘registered caravan park’ is expressly and exhaustively defined by the statutory regime under the RTA. Importantly, too, a ‘registered caravan park’ is already a ‘caravan park’ for the purposes of that statutory regime. Given this position, it would be inapposite to describe a registered caravan park as being ‘under development’ or ‘under construction’ given it will have already evolved into a ‘caravan park’, at least as that term is understood under the RTA.[106] In such circumstances, the respondent’s ‘central distinction’ between land set aside for a purpose and intentionally left vacant in furtherance of that purpose, and land that is ‘in the process of being developed or is yet to be developed’ is misconceived in the context of a registered caravan park.
[106]To the extent necessary, I also accept the applicants’ submission that the Tribunal’s reference to ‘under development’ was intended to be a reference to the progression of the installation of the dwellings.

The respondent’s position also appears to be contrary to the Agreed Summary which recites that each land was ‘developed into a caravan park’ (as set out at paragraph 65, above). However, rather than using the word ‘developed’, I accept this as an acknowledgment that each land was devoted to a caravan park (with a specified number of sites and community areas) with no inconsistent use. Thus, the respondent accepted that there was no competing use in this case.

I also do not consider that some of the other matters highlighted by the respondent assist with the construction in this case. The fact that land tax is assessed on an annual basis is not of any particular assistance. Rather, such a requirement lends itself just as well to the applicants’ concept of a caravan park which may or may not continue to operate. I also do not consider that any firm conclusion can be drawn about the inclusion of s 78A which was apparently introduced to ensure an adequate supply of aged and residential care facilities.[107] For reasons given already, I also do not consider it appropriate to describe a registered caravan park as ‘under development’ or ‘under construction’.
[107]Victoria, Parliamentary Debates, Legislative Assembly, 6 May 2010, 1711 (Tim Holding).

I also do not consider that s 77(3), of itself, is crucial in resolving the construction question. Rather, as the applicants submitted, this provision still requires consideration of whether part of the land is ‘used as’ a ‘registered caravan park’, and thereby squarely raises the same critical issue as to what constitutes ‘use as a registered caravan park’. Section 77(3) can also still be given work to do if the applicants’ construction is adopted. Thus, it could readily be applied where part of the land was ‘used as’ a commercial car park, or for some other unrelated business.

The respondent’s main attack at the hearing of the appeal was directed to the parts of (one of) the caravan parks which appeared to be vacant, and from which the Court was asked to draw the inference that relevant civil works had not commenced. However, it is not this Court’s role to derive findings of fact from an inspection of a photograph. In any event, the objective certificates of registration record that there was compliance with the Regulations.

The decision of the High Court in Eaton also establishes that physical use is not an indispensable element in finding that there is an existing use of land. That decision determined that part of land not yet covered by timber was nevertheless held to be in ‘existing use’ as a timber yard. Barwick CJ stated (after referring to Parramatta City Council v Brickworks Ltd):[108]

It is clear, in my opinion, from this Court's decision in the case to which I have referred, that physical use is not an indispensable element in an existing use of land for the purposes of such a provision as cl 30 of the Warringah Scheme. Land which is kept vacant for use as the needs of a business demand is not of necessity properly designated, in my opinion, as land not in existing use, but merely intended for future use. Much will depend on the extent of its integration with land in actual physical use and the nature of the business being conducted.[109]

[108](1972) 128 CLR 1; [1972] HCA 21.

[109]Eaton & Sons Pty Ltd v Warringah Shire Council (1972) 129 CLR 270, 273-4 (Barwick CJ); [1972] HCA 33.

His Honour went on to state that the physical use of the land would vary according to the exigencies of the business to whose purposes the land as a whole had been devoted.[110] He considered that the purpose for which land was purchased, coupled with the integration of the land with land in business use, were important factors tending towards the conclusion that the land was currently used for the purposes of the business carried on the land.[111]
[110]Ibid 274 (Barwick CJ).
[111]Ibid 274 (Barwick CJ).

The respondent suggested that Eaton was decided in a different context (being concerned with a planning ordinance and in different language). This is no doubt true, but the respondent also accepted that land not physically used may nonetheless meet the description of land used as a particular facility, if it is used in the manner intended by the owner, and has a sufficient relationship to that part of the land that is physically used. The differences may also not be of great significance given the Court appeared to refer to both use ‘for the purposes of the business’ and use ‘as’ something. Thus, Barwick CJ ultimately considered that the whole of the land was properly described ‘as a timber yard’ and that the entire land was ‘in use … as a timber stacking area’.[112]
[112]Ibid 275 (Barwick CJ) (emphasis added).

Returning to the facts of this case, according to the Agreed Summary, the land in each case was acquired for development and use as a registered caravan park ie each was intended to be used as a caravan park. Once all of the sites (including the ‘vacant’ ones) were registered together, the land in each case also constituted a single whole caravan park for use in the caravan park business. Thereafter, like Eaton, there was a progressive installation of moveable dwellings according to the demands of the caravan park business.

Ultimately, the reason the exemption was not made out in this case was not that there was some progressive use of the sites, but, rather, that the primary judge was unable to be satisfied that the land was ‘presently available for occupation.’ However, I do not accept that this is an appropriate test under s 77. Nor do I accept the respondent’s contention that the concept of ‘use as’ a registered caravan park in this context involves some concept of ‘enabling’ occupation’ or ‘being developed’. Rather, for the reasons which follow, I generally accept and prefer the applicants’ construction. More specifically, I accept that land acquired for use as a caravan park will be relevantly ‘used as’ a registered caravan park where it is registered, operating and devoted to such use (there being no competing use).

First, then, and most significantly, a comparison with other exemptions in Pt 4 Div 5 of the Act suggests that the draftsperson has taken considerable care to choose the words ‘used as’, as opposed to ‘occupied,’ or even ‘currently available for occupation’.[113] Such specificity of language strongly suggests that the words ‘used as’ are not intended to encompass ‘occupation’, or require that the land be ‘currently available for occupation’.
[113]See Land Tax Act 2005 ss 75, 76, 76A, 78.

Section 77 is a re-enactment of the provision formerly contained in s 9(1)(l) of the Land Tax Act 1958 which was inserted by s 27 of the State Taxation Acts (General Amendment) Act 2005. The words ‘used as’ were chosen despite the fact that s 26 of the same Act inserted an exemption for land ‘occupied, or currently available for occupation’ as a residential care facility or supported residential service. The ‘used as’ formulation was also chosen notwithstanding that, shortly prior to this time, in 2003, Parliament chose to alter the exemption test for retirement villages (in s 9(1)(j) of the Land Tax Act 1958) from ‘used and occupied’ to ‘occupied, or currently available for occupation’.[114] In so doing, the accompanying explanatory memorandum stated that this wording was chosen to ensure the exemption did not extend to ‘vacant or undeveloped, or uncompleted, portions of the land’.[115]
[114]See State Taxation Acts (Further Miscellaneous Amendments) Act 2003 s 10. The exemption is now contained in Land Tax Act 2005 s 78.
[115]Explanatory Memorandum, State Taxation Acts (Further Miscellaneous Amendments) Bill 2003, 9.

The legislative history and extrinsic materials therefore tend to confirm that the concept of ‘use’ is different and separate from the concept of ‘occupation’.[116] It also weighs against the respondent’s construction that ‘use’ ought not extend to ‘undeveloped’ land (whatever that may be).
[116]See Interpretation of Legislation Act 1984 s 35(b).

The primary judge appears to have come to a different view by reason of the various definitions specific to Pt 4A of the RTA. However, the focus must be centrally concerned with the construction of s 77 of the Act which excludes any reference to ‘occupation’. Given s 77 does not distinguish between traditional caravan parks and Part 4A parks any construction must also be appropriate for application to all registered caravan parks.

Secondly, in order to consider the meaning of ‘used as’ in relation to land which has a special, defined meaning, it is important to consider the pre-existing state of the land contemplated by that meaning. In this case, the draftsperson has directly connected the concept of ‘used as’ to a ‘registered caravan park’ ie an area of land that is registered under the highly prescriptive regime outlined in the RTA and the Regulations. That regime not only sets out what a ‘caravan park’ is, but also identifies what is required in the way of preparation of land so that the caravan park may be registered (including by prescribing relevant standards). There is no legislative warrant for imposing any additional requirements in terms of the state of the land.

Thirdly, I accept the applicants’ submission that the focus of the exemption is directed to the owner rather than the tenant. However, this focuses attention on the ‘caravan park owner’ who is the owner of a business which ‘operates‘ a caravan park. Although the primary judge identified that a caravan park owner may use the park, her primary focus was directed to use by proposed tenants of Part 4A dwellings. To the extent that she focused on the owner she correctly acknowledged that a caravan park owner may use the land ‘by making land within the caravan park available for occupation’.[117] Although this may be an example of a ‘use’, her Honour’s focus was again constrained by concepts of ‘occupation.’ Not only is there no mandate for such a constraint in s 77, the definition of a ‘caravan park owner’ suggests that land may be relevantly used where an owner ‘operates’ a caravan park. This suggests that there may be use of land as a caravan park if it is generally ‘employed or availed of’ in a caravan park business (with sites taken up progressively as the business develops). Such a construction is consistent with the ordinary concept of ‘use’ as ‘employment’ of land which is ‘availed of’ in a caravan park business. It is also consistent with the dictionary definition of ‘use’ which includes ‘to operate’.[118]
[117]Reasons [66].
[118]Macquarie Dictionary (online at 11 March 2021) ‘use’ (def 7).

Fourthly, for reasons already given, the decision in Applewood is clearly distinguishable. More particularly, it is unhelpful to describe a caravan park registered under the RTA scheme as ‘undeveloped’.

Finally, I consider that the applicants’ construction is consistent with the apparent purpose of Pt 4 Div 5 to encourage lower cost residential accommodation and care facilities.

I would add that, although ease of application may not be a primary consideration, the concept of ‘readiness for occupation’ raises a great deal of uncertainty in the context of a registered caravan park. This is underscored in the present case given the arbitrary measure of ‘frame stage’ chosen by the respondent at the Tribunal. As highlighted already, a caravan park may also exist under the legislation even without the individual connection of services. More significantly, there appears to be no justification for adding further requirements ‘for occupation’ in circumstances where a legislative scheme already makes provision for the standards for facilities and services on land constituting a registered caravan park. The primary judge viewed any such conflict between the Act and the registration scheme under the RTA as an ‘apparent conundrum’ but does not really resolve it.[119] However, s 77 has specifically directed itself to the issue and expressly incorporated the standards prescribed under the legislative scheme under the RTA.
[119]Reasons [81].

The primary judge also considered that the possibility that registration may be granted notwithstanding that a ‘schedule of works’ may be outstanding weighed against the applicants’ construction.[120] However, the completion of a schedule of works may well be regarded as ‘use’ in circumstances where it is contemplated by the regulations dealing with registration. In any event, the issue does not arise in this case given there is no evidence that registration was subject to completion of a schedule of works. Rather, notwithstanding any outstanding civil works, the registration of the caravan park in each case suggests that each one met the relevant standards.
[120]Reasons [82].

For all of the above reasons, I thereby reject the respondent’s construction, as well as that of the primary judge.

For similar reasons, I also respectfully disagree with the construction advanced by the majority which is not compelled by either the text or context of the Act. First, it is not justified by the legislation which already sets out the requisite state of the land necessary for recognition as a ‘registered caravan park’. The imposition of a further requirement for unknown civil works raises uncertainty and, more importantly, augments the prescribed standards which already apply for land to be defined as a ‘registered caravan park’. Secondly, it also focuses on the state of the land, rather than when that land (as defined) will be ‘used’. Thirdly, a test of whether movable dwellings may be situated on the land is tantamount to asking whether the land ‘enables occupation’ or is ‘currently available for occupation’. Finally, a focus on the state of the land gives insufficient weight to the statutory definitions which specifically provide for use of the land by the owner of a business which ‘operates’ a registered caravan park. The concept of ‘use’ in this context goes beyond mere registration, and focuses on the perspective of an owner in terms of how that owner may ‘employ’ land already recognised as a ‘registered caravan park’.

Notwithstanding that the issue of construction is not free from difficulty, I therefore consider that where land is acquired for use as a caravan park, and registered as a caravan park, it will be relevantly ‘used as’ a ‘registered caravan park’ where it is operating and devoted to such use (there being no competing use).

Insofar as the facts are concerned, the Agreed Summary records that the land in each case was acquired for use as a caravan park. Given each caravan park was registered as a caravan park in 2015, it also follows that the land (constituted by the sites and community areas identified on the plans) was a functioning caravan park as that term is used within the legislative scheme under the RTA. The certificates in each case also indicate that each was compliant with the standards under that scheme. The Agreed Summary further suggests that each land was devoted to a caravan park and that, by 31 December 2015, each caravan park had ‘commenced business as a registered caravan park’.

Upon the uncontested facts, as at the relevant time, the land in each case had therefore been acquired for use as a caravan park, and was registered and operating as such, in circumstances where the land was devoted to such use (with no competing inconsistent use). Given that, on the unchallenged facts, the only decision available on a correct construction is that the full exemption is established, the Tribunal’s decision should be set aside (which was based on apportionment by reference to ‘frame stage’).[121]
[121]See Osland v Secretary of the Department of Justice (No 2) (2010) 241 CLR 320, 332–3 [20] (French CJ, Gummow and Bell JJ); [2010] HCA 24.

Conclusion

I would grant leave to appeal, and allow the appeal. I would also grant leave to cross-appeal, but dismiss the cross-appeal. I would further make orders to the effect that each parcel of land was wholly exempt from land tax.

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SCHEDULE OF PARTIES

S EAPCI 2020 0082

LIFESTYLE INVESTMENTS 1 PTY LTD (ACN 083 091 016) First applicant

LIFESTYLE INVESMENTS 2 PTY LTD (ACN 147 278 091) Second applicant

LIFESTYLE COMMUNITIES INVESTMENTS CRANBOURNE PTY LTD (ACN 138 837 573) Third applicant

and

COMMISSIONER OF STATE REVENUE Respondent

S EAPCI 2020 0096

COMMISSIONER OF STATE REVENUE Cross-applicant

and

LIFESTYLE INVESTMENTS 1 PTY LTD (ACN 083 091 016) First cross-respondent

LIFESTYLE INVESMENTS 2 PTY LTD (ACN 147 278 091) Second cross-respondent

LIFESTYLE COMMUNITIES INVESTMENTS CRANBOURNE PTY LTD (ACN 138 837 573) Third cross-respondent

LIFESTYLE INVESTMENTS 1 PTY LTD (ACN 083 091 016)	First applicant
LIFESTYLE INVESMENTS 2 PTY LTD (ACN 147 278 091)	Second applicant
LIFESTYLE COMMUNITIES INVESTMENTS CRANBOURNE PTY LTD (ACN 138 837 573)	Third applicant
and
COMMISSIONER OF STATE REVENUE	Respondent

COMMISSIONER OF STATE REVENUE	Cross-applicant
and
LIFESTYLE INVESTMENTS 1 PTY LTD (ACN 083 091 016)	First cross-respondent
LIFESTYLE INVESMENTS 2 PTY LTD (ACN 147 278 091)	Second cross-respondent
LIFESTYLE COMMUNITIES INVESTMENTS CRANBOURNE PTY LTD (ACN 138 837 573)	Third cross-respondent

[2021] VSCA 107

30 April 2021