Wang & Anor v Chief Commissioner of State Revenue [2023] NSWCATAP 331

Background

The Appellants were some 30 days late in filing their appeal application.

At first instance, the Tribunal had confirmed the Chief Commissioner’s surcharge land tax assessments as the principal place of residence exemption did not apply to any of the specified tax years for the Appellants’ respective half shares of the property.

The facts underlying the surcharge land tax assessments, briefly stated are:

1. The First and Second Appellants were spouses who jointly owned a residential property in Oatlands (“Property”).
2. The Appellants were separately assessed for Surcharge Land Tax in respect of the Property under s. 5A of the Land Tax Act 1956.
3. The First Appellant (Ms Wang) sought review of her land tax assessment for the 2021 tax year.
4. The Second Appellant (Mr Chen) sought review of his assessments for the 2017 to 2022 land tax years.
5. From 2016 to 2018, the Appellants moved out of the Property in order to live nearer to their child’s school and rented the Property to others while they lived in a rented house.
6. The Appellants travelled to China in early 2020 with their child to live with the Mrs Wang’s parents.
7. Mrs Wang returned to Australia in September 2021, having been unable to return earlier due to the COVID-19 pandemic.
8. Mr Chen remained in China, stating that he felt obliged to stay in order to care for Mrs Wang’s elderly parents.
9. He stated, however, that at all times from 2016 he lived in the Property for various periods and regarded it as his principal place of residence, even when he was overseas or lived elsewhere in Sydney.

Decision

The Appeal Panel, in considering whether time should be extended to lodge the Notice of Appeal, applied the test in Jackson v NSW Land and Housing Corporation [2014] NSWCATAP 22:

“The considerations that will generally be relevant to the Appeal Panel's consideration of whether to grant an extension of time in which to lodge a Notice of Appeal 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 Appellant;
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 - 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;
3. Generally, in an application for an extension of time to appeal the Appeal Panel will be required to consider:
   1. The length of the delay;
   2. The reason for the delay;
   3. The Appellant's prospects of success, that is usually whether the applicant has a fairly arguable case; and
   4. The extent of any prejudice suffered by the respondent (to the appeal); 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 Appellant seeking an extension of time can show that his or her case has more substantial merit than merely being fairly arguable.”

Applying the above principles to the facts of the case, the Appeal Panel held in relation to:

1. the length of the delay and reasons for the delay, the Appellants did not provide sufficient evidence to explain why seeking a solicitor’s assistance led to the significant 30-day delay in filing their appeal application;
2. prejudice, the Respondent did not oppose time being extended for the Appellants to lodge their appeal;
3. whether the appeal demonstrated any merits, the Tribunal noted the following principles:
   1. The Appellants have a right to appeal on a question of law, and, otherwise, with the leave of the Appeal Panel: NCAT Act s 80(2)(b).
   2. This does not include a right to have their case before the Tribunal re-heard and determined.
   3. Instead, the onus is on the Appellants to identify: (a) an error by the Tribunal that raises a question of law; or (b) some other error warranting a grant of leave to appeal.
   4. In Prendergast v Western Murray Irrigation Ltd [2014] NSWCATAP 69, at [12], the Appeal Panel said that, in circumstances where an Appellant is not legally represented, it is appropriate for the Tribunal to approach the issue by looking at the grounds of appeal generally, and to determine whether a question of law has in fact been raised (subject to any considerations of procedural fairness to the respondent that might arise).

The Appeal Panel then examined each of the three grounds of appeal raised by the Appellants to determine their merits as follows:

1. Ground 1: In 2019, 2020 and 2022 the Property was the sole residence of the Appellants and should be exempt. The Appeal Panel found there were no merits in this ground of appeal and that the following conclusions reached by the Tribunal below were open to it on the evidence and applicable law:
   • For the 2019 and 2022 land tax years, the Tribunal accepted that Mr Chen had a ‘desire’ and ‘intention’ to reside in the Property with his family ‘as soon as his family circumstances allowed’. This acceptance, however, was not a finding that Mr Chen had the requisite intention to use and occupy the Property as his principal place of residence for a continuous period of 200 days in the 2019 and 2022 land tax years. Instead, the Tribunal found that Mr Chen had chosen to remain in China to look after his parents-in-law. Accordingly, the Tribunal found that Mr Chen did not use and occupy the Property as the principal place of residence for a continuous period of 200 days during the 2019 and 2022 land tax years.
   • Mr Chen also asserted that as his family (Mrs Wang, and his son) did use and occupy the Property as their principal place of residence for a period that exceeded 200 days during the 2019 land tax year and again in the 2022 land tax year, he as a member of his family should be entitled to claim the exemption in s 5B. However, each taxpayer is assessed individually, under s 5A(4)(c) of the Land Tax Act, in accordance with their respective proportionate interest in the Property. Hence, Mrs Wang’s intended use and occupation and actual use and occupation of the Property during a land tax year, is of no relevance to Mr Chen’s intended use and occupation and actual use and occupation of the Property during the same land tax year: Song v Chief Commissioner of State Revenue [2023] NSWCATAD 301 at [59].
   • In relation to 2020, the undisputed evidence was that from about 18 January 2020 to the end of that year the Property was rented/leased to tenants. The Tribunal correctly found that the 2020 tenancy of the Property was inconsistent with a use and occupation of the Property by Mr Chen and Mrs Wang as their principal place of residence during that land tax year: see Chief Commissioner of State Revenue v Aldridge [2003] NSWCATAP 50.
2. Ground 2: Failure to take into account the personal circumstances of the Appellants. The Appeal Panel found the Appellants did not demonstrate any merits in this ground of appeal. The Appeal Panel held the principal place of residence exemption from surcharge land tax is available ‘only if’ the requirements are met. These requirements include:
   • S. 5B(1)(a) – the person is a permanent resident at midnight on 31 December the previous year;
   • S. 5B(1)(b) - that the Chief Commissioner is satisfied of the person’s intention to use and occupy the land as their principal place of residence during the land tax year;
   • S. 5B(2) - the person must use and occupy the land as their principal place of residence for a continuous period of 200 days in the land tax year; and
   • S.5B(3) - if the residence requirement is not complied with by the person, surcharge land tax liability is to be assessed or reassessed as if the person’s exemption from liability to pay surcharge land tax for the land tax year had never applied.

   The Appeal Panel observed that these subsections are very specific in their terms and are limited to an intent to use and occupy the land as the person’s principal place of residence in accordance with ‘resident requirement’ and an actual use and occupancy of the land as the person’s principal place of residence in accordance with ‘resident requirement’. If these terms are not satisfied, neither the Land Tax Management Act 1956, nor the Land Tax Act 1956 make provision for a person’s personal circumstances to be taken into account.

3. Ground 3: It was unfair that the Tribunal did not mention the cases the Appellants had presented when circumstances similar to the Appellants had been taken into account.
   
   The Appeal Panel found the Appellants did not demonstrate any merits in this ground of appeal as the Tribunal is not bound to take into account cases that are not relevant to the matters in issue before it.

Orders

The Appellants’ application for an extension of time to lodge their appeal is refused.

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