|Date of judgement||2 April 2020|
|Judge(s)||A R Boxall, Senior Member|
|Court or Tribunal||NSW Civil and Administrative Tribunal|
First Home Owner Grant; New Home; Duties Act s.49
B&L Linings Pty Ltd v Chief Commissioner of State Revenue (2008) 74 NSWLR 481
Wang v Chief Commissioner of State Revenue  NSWCATAD 61
The Applicants sought administrative review of the Respondent’s decision to refuse their application for a FHOG Grant in the amount of $10,000 in relation to their purchase of a property at 23/261 Condamine Street, Manly Vale NSW (“the Property”) on the basis that the Property is not a “new home” within the meaning of section 4A(1) of the FHOG Act.
The Applicants purchased the Property for $695,000 under contract for sale of land executed on 2 October 2016 (“the Contract”). The Contract indicates the vendor as TIAA Group Pty Ltd as Trustee For Raco Group Super Fund (“TIAA”). The only part of the Contract in evidence was the first page. The Contract refers to a Schedule of Finishes and certain other clauses or special conditions none of which were in evidence.
Prior to the Contract being entered into, on 29 April 2016, TIAA entered into a contract for sale of land as purchaser of the Property with Zegna Property Group Pty Ltd (“Zegna”) as vendor for a purchase price of $600,000.
The transfer from TIAA to the Applicants was registered on 30 July 2018.
The transfer from Zegna to TIAA was also registered on 30 July 2018 immediately before the registration of the transfer to the Applicants, bearing the immediately preceding sequential registration number allocated by the Registrar-General.
On or about 11 August 2019, the Applicants lodged an application for a FHOG with Revenue NSW. The Explanatory Note from the Applicants forming part of the application describes the Property as having been developed by Zegna and sold “off the plan”. That application was rejected on 20 August 2019 on the basis that the sale to the Applicants “was not the first sale of the property” so their purchase of the Property was not an “eligible transaction”.
Senior Member Boxall identified the two separate transactions concerning the Property which both completed shortly after registration of the strata plan on 12 July 2018:
The FHOG Act provides a legislative scheme for the payment of grants to first home owners who purchase or build new homes and comply with certain eligibility requirements.
The eligibility criteria with which applicants for a FHOG must comply are set out in Part 2, Division 2 of the Act. It was not in dispute in this proceeding that the Applicants fulfil those eligibility criteria.
The dispute was whether the Property was a “new home” as defined in Section 4A of the FHOG Act.
The Applicants contended that there was only one transaction when they acquired the Property, being a transaction under which they paid the balance of the purchase price in exchange for the title to it.
Further, the Applicants argued as follows:
In summary the Applicants contended that:
In summary the Applicants contended that:
The Applicants also argued that since TIAA never occupied the Property, the sale to Zegna could not have completed within the meaning of section 13(5). Therefore, the Applicants were the first occupiers of the Property and must be entitled to the first home owners grant.
Senior Member Boxall found the elements of section 4 of the FHOG Act were satisfied.
Senior Member Boxall then addressed the next question as to whether the Property was or was not “previously occupied or sold as a place of residence” for the purposes of section 4A(1) before the sale to the Applicants. The Senior Member indicated there was no suggestion that the Property was occupied ”as a place of residence” by TIAA before the Applicants acquired the Property. He considered that looking at the Applicants’ and TIAA’s uses of the Property is not relevant and one should look at what was sold (and agreed to be sold) in the underlying transactions.
He found that legally there were:
In order for TIAA to discharge its obligation under the Contract to sell the Property to the Applicants it must first have acquired it from Zegna. The transaction under which TIAA sold the Property to the Applicants was its second sale as a completed apartment and place of residence, the first being that under which TIAA acquired it from Zegna. Senior Member Boxall considered that there was a substantial difference between the price payable by TIAA to Zegna and that payable by the Applicants to TIAA, which reinforced at a commercial level the legal analysis that there were two distinct sale transactions of which that to the Applicants was the second.
The Tribunal considered that completion of the sale as between Zegna and TIAA not only occurred but it was a necessary precondition to completion of the sale by TIAA to the Applicants and this of itself is sufficient to establish that they did not acquire the Property as a new home for the purposes of section 4A(1).
The Tribunal found that the Applicants have not discharged their onus under section 28(3) of the FHOG Act to prove their case under review. Accordingly, they are not entitled to a first home owner grant in respect of the Property as it had ceased to be a “new home” within the meaning of section 4A of the FHOG Act when they acquired it.
The (Chief Commissioner’s) assessments are confirmed.