Thomas v Chief Commissioner of State Revenue

[2025] NSWCATAD 67

Civil and Administrative Tribunal

New South Wales

Medium Neutral Citation:

Thomas v Chief Commissioner of State Revenue [2025] NSWCATAD 67

Hearing dates:

18 February 2025

Date of orders:

17 March 2025

Decision date:

17 March 2025

Jurisdiction:

Administrative and Equal Opportunity Division

Before:

S E Frost, Senior Member

Decision:

The Applicant’s application for an extension of time to lodge an application for review in the Tribunal is refused.

Catchwords:

ADMINISTRATIVE LAW – Civil and Administrative Tribunal (NSW) – application made out of time – First Home Owners Grant and First Home Buyers Assistance Scheme – application for extension of time – exercise of discretion

TAXES AND DUTIES – First Home Owners Grant and First Home Buyers Assistance Scheme – residence requirement – discretion to ease or waive the requirement

Legislation Cited:

Civil and Administrative Tribunal Act 2013 (NSW)

Duties Act 1997 (NSW)

First Home Owner Grant (New Homes) Act 2000 (NSW)

Taxation Administration Act 1996 (NSW)

Cases Cited:

Daoud v Chief Commissioner of State Revenue [2015] NSWCATAD 53

Jackson v Land and Housing Corporation [2014] NSWCATAP 22

Texts Cited:

None cited

Category:

Principal judgment

Parties:

Clay William Thomas (Applicant)
Chief Commissioner of State Revenue (Respondent)

Representation:

S Thomas (Applicant)
Crown Solicitor (Respondent)

File Number(s):

2024/00429455

Publication restriction:

No restriction

REASONS FOR DECISION

Summary

1. The Applicant has lodged an application for administrative review of certain decisions of the respondent Chief Commissioner, but he has lodged the application out of time. The question currently before the Tribunal is whether the Applicant should be granted an extension of time, so that his application may proceed.

What does the Applicant want reviewed?

2. The Chief Commissioner’s decisions both originated from the Applicant’s failure to live in a property he had purchased as a first home buyer in late 2017. The Applicant had initially been given a First Home Owners Grant (FHOG) and an exemption from transfer duty under the First Home Buyers Assistance Scheme (FHBAS), but both of them on condition that he would meet the so-called residence requirement. That meant (unless the Chief Commissioner exercised a discretion to ease the requirement) he had to start living in the property within 12 months of purchasing it, and then live in it for a continuous period of at least 6 months.

3. The Applicant didn’t live in the property at all during the first 12 months of ownership. In fact the property was leased to a tenant for 35 weeks in the 2018 and 52 weeks in the 2019 financial years. The Chief Commissioner accordingly reversed the FHOG and also assessed the Applicant as liable to transfer duty. The Applicant objected to those decisions, but each objection was disallowed. That left the Applicant owing around $20,000 to the Chief Commissioner.

4. The Applicant would now like the decisions reviewed by the Tribunal. In his Administrative review application form he sets out the following Grounds for Application to review the decisions:

Supporting Medical Letter – As a result of Financial Hardship due to being an At Fault Driver whereby my Insurer denied my claim to cover the damages because I was using my Vehicle for Business purposes at the time of the accident. I suffered Financial Hardship and then later Stress & Depression brought on by my Financial Woes. As a result of the insurance debt I realised I was unable to move into my 1st New Home and had to remain living with my Parents to be able to pay down the debt to the MV Insurer. This occurred during the 12 month qualifying period for the 1^st Home Buyers Grant.

5. Explaining the reason for the late application, he stated:

Depression and Stress brought on by Financial struggles has affected my ability to manage my affairs. I am now on medication, have paid off all debt and managing life better.

6. The Applicant’s parents (his father and stepmother) ultimately paid their son’s debt, in late 2024. According to his stepmother, Mrs Sherry Thomas, they did this to ‘assist Clay with his emotional and mental recovery’. Mrs Thomas claims it was only then, when discussing the Applicant’s circumstances with the Chief Commissioner’s officers, that she realised her son’s poor mental health could provide a sound basis for the exercise of the Chief Commissioner’s discretion to ease or waive the residence requirement, as outlined in [2] above. The review application was lodged with the Tribunal shortly thereafter.

The residence requirement

7. At the time the Applicant purchased the property in 2017, the residence requirement was set out in s 12 of what was then called the First Home Owner Grant (New Homes) Act 2000 (NSW) (FHOG Act). It required occupation of the property as the owner’s principal place of residence (PPR):

1. to commence within 12 months or the period approved by the Chief Commissioner, and

2. to continue for a continuous period of at least 6 months or the period approved by the Chief Commissioner.

8. The Chief Commissioner could approve either of those alternative periods (either the later commencement of occupation, or a shorter period of occupation) ‘if satisfied there are good reasons to do so’ and could do so even if the original periods had already expired or ceased. The Chief Commissioner could also exempt an applicant from the residence requirement altogether, but again he had to be satisfied ‘there are good reasons to do so’.

9. Provisions to similar effect are to be found in s 76 of the Duties Act 1997 (NSW).

10. The Applicant failed to meet the standard provisions of the residence requirement (occupation as the PPR within 12 months, and for a continuous period of at least 6 months). To be relieved of his liability to pay back the FHOG or to pay the transfer duty, the Applicant would have to rely on the discretionary approval of alternative periods of commencement and duration of occupation of the property. As indicated, the discretion could be exercised in his favour if the Chief Commissioner (or the Tribunal on review) were to be satisfied ‘there are good reasons to do so’.

Late lodgement of the application for review

11. Applications for review of decisions to make a reassessment of duty under the FHBAS are meant to be lodged within 60 days of the issue of the notice of objection decision, but the Tribunal may allow a person to apply for a review after that 60-day period: s 99(1) of the Taxation Administration Act 1996 (NSW) (TA Act).

12. Applications for review of decisions to repay the FHOG are also meant to be lodged within 60 days of the issue of the notice of objection decision, but the Tribunal may allow a person to apply for a review after that 60-day period: s 28(4)(a) and (5) of the FHOG Act.

13. The objection decision, dealing with both the reassessment of duty and the reversal of the FHOG, was issued on 28 June 2022. That means the application for review was meant to be lodged by 27 August 2022, but it wasn’t lodged until 19 November 2024. It was 815 days late.

14. The Tribunal also has a general power to extend time under s 41 of the Civil and Administrative Tribunal Act 2013 (NSW) (NCAT Act), which provides as follows:

41 Extensions of time

(1) The Tribunal may, of its own motion or on application by any person, extend the period of time for the doing of anything under any legislation in respect of which the Tribunal has jurisdiction despite anything to the contrary under that legislation.

(2) Such an application may be made even though the relevant period of time has expired.

15. The principles that apply to the consideration of an application for an extension of time, whether it is considered under the TA Act, the FHOG Act or the NCAT Act, are the same.

Extension of time considerations

16. In Daoud v Chief Commissioner of State Revenue [2015] NSWCATAD 53 the Tribunal explained the following in relation to extension of time applications:

[15]   The grant of an extension of time is not automatic. The discretion to extend time is given for the sole purpose of enabling the Tribunal to do justice between the parties. In order to determine whether the rules will work an injustice, it is necessary to have regard to the history of the proceedings, the conduct of the parties, the nature of the litigation, and the consequences for the parties of the grant or refusal of the application for extension of time. It is also necessary to consider the prospects of the Applicants succeeding in their application. In order to justify the Tribunal extending the time, there must be some material upon which the Tribunal can exercise its discretion: see Gallo v Dawson [1990] HCA 30, 93 ALR 479 at [2] per McHugh J. and the authorities referred to therein. See also Opera Australia Ltd v Carr [1999] NSWADTAP 6 at [16] and Chand v Rail Corporation of New South Wales No 3 [2010] NSWADTAP 11 at [20].

[16]   Time limits are set to promote the orderly and efficient conduct of proceedings in the Tribunal, to provide certainty for the parties to proceedings, and to achieve finality in litigation. For these reasons, time limits should generally be strictly enforced unless the interests of justice require that the extension be granted.

[17]   As set out in Jackson v Land and Housing Corporation [2014] NSWCATAP 22 at [22] albeit in the context of an Appeal, the relevant considerations in deciding whether to grant an extension of time include:

(1)   The discretion can only be exercised in favour of an applicant upon proof that strict compliance with the rules will work an injustice upon the Applicant ­ Gallo v Dawson [1990] HCA 30, 93 ALR 479 at [2], Nanschild v Pratt [2011] NSWCA 85 at [38];

(2)   The discretion is to be exercised in the light of the fact that the Respondent (to the appeal) has already obtained a decision in its favour and, once the period for appeal has expired, can be thought of as having a “vested right” to retain the benefit of that decision ­ Jackamarra v Krakouer (1998) 195 CLR 516 at [4], Nanschild v Pratt [2011] NSWCA 85 at [39] and, in particular, where the right of appeal has gone (because of the expiration of the appeal period) the time for appealing should not be extended unless the proposed appeal has some prospects of success ­ Jackamarra at [7];

(3)   Generally, in an application for an extension of time to appeal the Appeal Panel will be required to consider:

(a)   The length of the delay;

(b)   The reason for the delay;

(c)   The Applicant's prospects of success, that is usually whether the applicant has a fairly arguable case; and

(d)   The extent of any prejudice suffered by the Respondent (to the appeal): Tomko v Palasty (No 2) (2007) 71 NSWLR 61 at [55] (per Basten JA) but note also [14], Nanschild v Pratt [2011] NSWCA 85 at [39] to [42]; and

(4)   It may be appropriate to go further into the merits of an appeal if the explanation for the delay is less than satisfactory or if the opponent has a substantial case of prejudice and, in such a case, it may be relevant whether the Applicant seeking an extension of time can show that his or her case has more substantial merit than merely being fairly arguable ­ Tomko v Palasty (No 2) (2007) 71 NSWLR 61 at [14] (per Hodgson JA, Ipp JA agreeing at [17]) and Molyneux v Chief Commissioner of State Revenue [2012] NSWADTAP 53 at [58] ­ [59].

Taking the considerations into account

The length of the delay

17. The delay, at 815 days, is very substantial.

The reason for the delay

18. The Applicant’s stepmother articulates the reason for the delay in the following way:

I was not aware of the extent of Clay’s Depression or the discretionary powers available to the Chief Commissioner for unforeseen and/or unavoidable events at this time such as:

Incapacity of the applicant to live in the home due to illness.

Had we of know [sic] about the severity of Clay’s emotional state earlier and the discretionary powers of the Chief Commissioner earlier we would have lodged an Appeal within the time allowed.

19. The late identification of facts capable of supporting an applicant’s case can, in some circumstances, amount to an acceptable reason for a delay in taking action.

20. Here, Mrs Thomas, on her son’s behalf, claims ignorance of the discretion to ease the strict terms of the residence requirement until she was informed of it in the discussion with a revenue officer in late 2014. But the Applicant was told about the Chief Commissioner’s discretionary powers in the notice of objection determination in June 2022, where it was stated:

For the Chief Commissioner to exercise his discretion to waive the residence requirement pursuant to Section 76(2)(b) of the Duties Act 1997 (for FHBAS) and Section 12(4) of the First Home Owner Grant (New Homes) Act 2000, the following factors must be present:

At the commencement of the eligible transaction or time of application the Taxpayer must have intended to occupy and must have objectively been capable of occupying the home as the Taxpayer’s principal place of residence

The applicant must be capable of doing so for at least 6 continuous months commencing within 12 months after completion of the eligible transaction

The reasons the applicant could not occupy the home within the required time were due to circumstances beyond their control.

In the present case, Clay Thomas’ decision to enter into a residential tenancy agreement has prevented him from fulfilling the residence requirement in the subject property.

The Chief Commissioner’s discretionary powers are reserved for unforeseen and unavoidable events such as:

(1)   Incapacity of the applicant to live in the home due to illness.

(2)   Home becomes [un]inhabitable due to health/structure issues or natural disasters.

21. Now seeking to rely on the exercise of the discretion, the Applicant claims he was so depressed that he was incapable of attending to his affairs in a timely fashion.

22. In support of this aspect of the claim Mrs Thomas has provided a medical report prepared by Dr Simon Pettit, who practises near where the Applicant lives. The report is dated 8 November 2024, more than 2 years after the period during which the Applicant’s condition is said to have caused the delay. Dr Pettit’s report includes the following:

Clay William Thomas is a patient of mine.

Clay came to see me on 26/09/2024 after feeling down, depressed, anxious and stressed for some years and trying to cope on his own without help.

Clay advised me he has been struggling with these symptoms since approximately 2017 after being involved in a car accident in which he was driving an uninsured vehicle and was the at fault driver.

I believe Clay to be depressed in part due to the emotional and financial stresses he has suffered in recent years as a result of this car accident.

Following this car accident Clay remained at home being supported both emotionally and financially by his parents.

Clay is making good progress towards a healthy, happy and productive life.

23. I accept the Applicant has provided an explanation for the delay but, since it lacks a contemporaneous medical report, it is not a very compelling one.

The Applicant’s prospects of success

24. The Applicant has acknowledged that he didn’t live in the property at all during the first 12 months of ownership. Therefore, to make good his case, he would have to satisfy the Tribunal that the discretion to reduce or waive the residence requirement period should be exercised in his favour. As outlined in [8] and [10] above, the discretion can only be exercised if the Tribunal is satisfied ‘there are good reasons to do so’.

25. The Applicant initially claimed it was the financial burden caused by the rejection of his motor vehicle insurance claim that prevented him from moving into the property. His claim is now put differently – that he did not have the capacity to live in the property due to illness.

26. The difficulty with the claim as currently articulated is that no reliable contemporaneous material has been put before the Tribunal to indicate the Applicant’s medical condition in 2017. Nor is it likely that any such material exists.

27. Dr Pettit wrote his report a full 7 years after the Applicant bought the property, and there is no indication he had been consulted any earlier than a few weeks before the date of the report. Even Mrs Thomas admits the family hadn’t known of the severity of the Applicant’s emotional state until much more recently. This renders it unlikely that anyone else – including any of the people closest to the Applicant – could provide reliable evidence to support his claims. There is little prospect, therefore, that the Applicant would be able to satisfy the Tribunal that there are ‘good reasons’ to exercise the discretion to waive or ease the residence requirement.

Prejudice

28. The Chief Commissioner does not assert that he has suffered any prejudice from the delay in bringing the application.

Conclusion

29. I am not satisfied, having regard to the matters discussed above, that the grant of an extension of time would do justice between the parties. The application was lodged more than 2 years out of time, the explanation of the reason for the delay is not compelling, and there are very slim prospects of success.

Order

1. The Applicant’s application for an extension of time to lodge an application for review in the Tribunal is refused.

I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales.

Registrar

Decision last updated: 17 March 2025