Weatherley and Secretary, Department of Families, Community Services and Indigenous Affairs

[2006] AATA 968

Administrative

Appeals

Tribunal

 

DECISION AND REASONS FOR DECISION [2006] AATA 968

ADMINISTRATIVE APPEALS TRIBUNAL          № V2005/61

GENERAL ADMINISTRATIVE  DIVISION

Re:CHRISTOPHER WEATHERLEY

Applicant

And:SECRETARY,

DEPARTMENT OF FAMILIES, COMMUNITY SERVICES AND INDIGENOUS AFFAIRS

Respondent

DECISION

Tribunal:       Regina Perton, Member

Date:15 November 2006

Place:Melbourne

Decision:The Tribunal affirms the decision under review.

(sgd) Regina Perton

Member

FARM HELP RE-ESTABLISHMENT GRANT – involvement in farm enterprise - applicant no longer a farmer – ongoing ownership of part of land – sound reasons for not selling that land – lessee using land as farm enterprise – grant not available when land used as farm enterprise – definition does not distinguish between lessor and lessee - decision affirmed.

Farm Household Support Act 1992 ss 3, 52A

Farm Help Re-Establishment Grant Scheme 1997  ss 1.3, 3.2, 3.2A

Parrett v Secretary, Department of Family and Community Services [2002] FCA 716

REASONS FOR DECISION

15 November 2006  Regina Perton, Member

1.      Christopher Weatherley is a former dairy farmer.  He stopped working as a farmer in October 2003.  On 22 April 2004, Mr Weatherley applied for a farm-help re-establishment grant (the grant).  The grant is available to those quitting farms, to assist in relocating and commencing a new career off the land.  The rules for obtaining the grant are complex and time-dependent.  Unless a claimant meets all the criteria for the grant, a decision-maker (including the Tribunal) has no option but to refuse the grant. 

2.      While Mr Weatherley had stopped working as a farmer on the date he applied for the grant, he still owned land that was used for farming.  Notwithstanding that Mr Weatherley had sound reasons for not selling the land at that time and had moved to a regional centre, he was refused the grant on the basis that his tenant was farming on the leased land.   

3.      There is little dispute about the facts in this matter.  However, the parties disagree about the interpretation of the relevant law and policy guidelines.

History

4.      Mr Weatherley and his wife owned a dairy farm of 160 acres on which they also lived.  The 160 acres was originally held in partnership with Mr Weatherley’s father and his father’s partner but, at the time of sale, had been transferred into Mr Weatherley’s and his wife’s names.  Mr Weatherley undertook to repay his father a set amount when the land was sold and did so.  The 160 acres was sold with a settlement date of 7 November 2003.  As well as farming the 160 acres, Mr Weatherley also leased an 80 acre property and owned a 93 acre property.  The lease on the 80 acres was relinquished.  All the farm’s assets including cattle and machinery were also sold in late October 2003, within the requisite period for the grant.    

5.      However, the 93 acre property posed a problem.  It was auctioned on 18 September 2003 and passed in at $230,000.  At that time the mortgage on the land was around $285,000.  Mr Weatherley and his bank manager gave evidence to the Tribunal about the difficulties in selling such a property at that time.  On 1 February 2004, Mr Weatherley, with the consent and encouragement of the bank, leased the 93 acres for a period of three years with a further three-year option.  At the time of the hearing, the tenants were growing lucerne on the 93 acre property.  The rental received is almost covering the interest on the fixed interest mortgage.

CONSIDERATION OF THE ISSUES

6.      Mr Weatherley’s evidence, and that of the other witnesses, is straightforward and credible.  The documentation provided is relevant and comprehensive.  There appears to be no dispute that Mr Weatherley meets most, if not all, other pertinent criteria for the grant except one.  However, the parties disagree about whether his ongoing ownership of the 93 acres disqualifies him from receiving the grant. 

7. Section 52A of the Farm Household Support Act 1992 (the Act) allows for the formulation of the grant scheme by way of written instrument.  Such an instrument was created, namely the Farm Help Re-Establishment Grant Scheme 1997 (the Scheme).

8. Section 3 of the Act sets out the meaning of farmer, farm enterprise and sale of a farm.  The same definitions apply to the Scheme (s 1.3 of the Scheme).

….

farm enterprise means an enterprise carried on within any of the agricultural, horticultural, pastoral, apicultural or aquacultural industries.

farmer means a person who:

(a) has a right or interest in the land used for the purposes of a farm enterprise; and

(b) contributes a significant part of his or her labour and capital to the farm enterprise; and

(c) derives a significant part of his or her income from the farm enterprise.

….

sale of a farm means a transaction as a result of which the rights or interests of a person in:

(a) a farm enterprise; and

(b) the land used for the purposes of the farm enterprise;

are transferred to another person.

9.      The Tribunal is satisfied that Mr Weatherley is no longer a farmer.  It is also satisfied that he has no intention of returning to farming.  The Tribunal accepts that on its own, the 93 acres is not viable for use as a dairy farm.  However, having leased the 93 acres to persons who are using it to grow lucerne, is Mr Weatherley still involved in a farm enterprise? 

10. Division 2 of the Scheme sets out the criteria for qualifying for the grant. Section 3.2 states:

3.2   Who is qualified for a re-establishment grant?

(1)  A person is qualified to receive a re-establishment grant if:

(a) the person was eligible to apply for the re-establishment grant when the person applied; and

(b)  the person’s farm enterprise has been sold (and the completion of the sale has taken place) within 1 year, or such longer period as the Minister, in writing, allows under section 3.2A, after:

(i) ….

(ii)  in any other case – the person applied for the re-establishment grant; and

….

11.     The Tribunal finds that the 93 acres is being used for a farm enterprise, namely the growing of lucerne.  The Tribunal accepts that this is a different use than that originally envisaged by Mr Weatherley.  However, the definition of farm enterprise is such that it covers a broad range of uses.  Furthermore, the definition concerns the use of the land itself, rather than who is using it. 

12.     The common usage of the word sale and its definition in the Act and Scheme clearly require a transfer of an applicant’s interest in the land to another person.  Mr Weatherley still owns the land on which the farm enterprise is being conducted.  While the lessee now has an interest in the land, Mr Weatherley, as lessor, also retains an interest.

13. Section 3.2A of the Scheme allows a longer period than one year for the sale of the farm enterprise after applying for the grant. However, at this time, none of the grounds apply to Mr Weatherley as he still owns the land on which the farm enterprise is based.

14.     The parties cited a number of earlier Tribunal decisions concerning the grant and the Scheme and the Federal Court’s decision in Parrett v Secretary, Department of Family and Community Services [2002] FCA 716. The Tribunal is not satisfied that any of those parallel this matter. Nor does the Tribunal find any ambiguity in any of the relevant definitions.

15.     The Tribunal sympathises with Mr Weatherley’s situation.  His decision not to sell the 93 acres was for sound reasons.  However, to receive the grant, he needs to satisfy the relevant criteria. 

DECISION

16.     The Tribunal affirms the decision under review.

I certify that the sixteen [16] preceding paragraphs are a true copy of the reasons for the decision of:

Regina Perton, Member

(sgd)    Ursula Noyé

Clerk

Date of hearing:  29 June 2006
Date of decision:  15 November 2006
Counsel for applicant:                  Mr G. Burns
Solicitor for applicant:                  Robert Smart & Associates
Advocate for respondent:            Mr S. Meehan
Solicitor for respondent:              Centrelink Legal Services