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Kamareddin v Chief Commissioner of State Revenue [2016] NSWCATAD 21

Date of judgement 05 February 2016 Proceeding No. 1510143
Judge(s) NS Isenberg
Court or Tribunal New South Wales Civil and Administrative Tribunal
Legislation cited Administrative Decisions Review Act 1997

Civil and Administrative Tribunal Act 2013

Duties Act 1997

Family Law Act 1975 (Cth)

Taxation Administration Act 1996
Catchwords REVENUE LAW – Duties Act – exemption – irretrievable breakdown of marriage – religious divorce
Cases cited B & L Linings Pty Ltd v Chief Commissioner of State Revenue [2008] NSWCA 187, (2008) 74 NSWLR 481

Cornish Investments Pty Limited v Chief Commissioner of State Revenue (RD) [2013] NSWADTAP 25

Gauci v Federal Commissioner of Taxation [1975] HCA 54; (1975) 135 CLR 81

Stature PO Ltd v Chief Commissioner of State Revenue [2002] NSWADT 271

Background

The Applicant sought review of the decision by the respondent to issue a duties notice of assessment on 18 April 2012 for the sum of $17,523.34 in respect of a transfer of residential land situated at Greenacre from Mr Omar Hussein to the Applicant.  The applicant had sought an exemption from stamp duty on this transfer.  The Duties Act 1997 exempts from duty transfers, and agreements to transfer that divide the matrimonial property of a marriage that had broken down irretrievably.

The first issue to be determined in this case was whether or not, at the time of the relevant dutiable transaction, the marriage between the Applicant and Mr Hussein had irretrievably broken down. The second issue was whether the agreement to transfer the property was effected in accordance with an agreement made for the purpose of dividing matrimonial property, as a consequence of the breakdown of the marriage.

The Statutory Framework

S.68(1) of the Duties Act 1997 (Exemptions-break-up of marriages and other relationships) provides:

  1. Break-up of marriage

    No duty is chargeable under this Chapter on a transfer, or an agreement for the sale or transfer, of matrimonial property if:

    1. the property is transferred, or agreed to be sold or transferred, to the parties to a marriage that is dissolved or annulled, or in the opinion of the Chief Commissioner has broken down irretrievably, or to either of them, or to a child or children of either of them or a trustee of such a child or children, and

    2. the transfer or agreement is effected by or in accordance with:

      1. a financial agreement made under section 90B, 90C or 90D of the Family Law Act 1975 of the Commonwealth that, under that Act, is binding on the parties to the agreement, or

      2. an order of a court under that Act, or

        1. an agreement that the Chief Commissioner is satisfied has been made for the purpose of dividing matrimonial property as a consequence of the dissolution, annulment or breakdown of the marriage, or

      3. a purchase at public auction of property that, immediately before the auction, was matrimonial property where the public auction is held to comply with any such agreement or order.

Decision

Senior Member Isenberg found the expression “a marriage that … has broken down irretrievably” in the context of s. 68(1)(a) had not been defined by the legislature or been dealt with by a Tribunal or Court. The words were given their ordinary meaning in the context of the Duties Act. Citing Barwick CJ in Gauci v Federal Commissioner of Taxation [1975] HCA 54, Senior Member Isenberg, to the extent that the oral evidence of the Applicant conflicted with the documents in evidence, preferred the oral evidence of the Applicant.

Senior Member Isenberg held that for the purposes of s 68(1)(a), the marriage had broken down irretrievably;  on the balance of probabilities, the Applicant believed that her marriage had irretrievably broken down and a divorce had occurred pursuant to her religious beliefs. Senior Member Isenberg also held that the contract transferring the property to the Applicant formed part of an agreement made prior to the contract for the purpose of dividing matrimonial property as a consequence of the breakdown of the marriage.

Orders

  1. The reassessment of duty pursuant to the Duties Notice of Assessment 66243 issued 18 April 2012 is revoked.

  2. The Chief Commissioner shall issue a Duties Notice of Assessment in its place which will have regard to the entitlement of the Applicant to the exemption from duty provided by paragraph 68(1)(b)(iia) of the Duties Act in accordance with the reasons for this decision.

Link to decision

Kamareddin v Chief Commissioner of State Revenue [2016] NSWCATAD 21

Last updated: 17 May 2016