ALQ March 2023 Merits Review

Issue: March 2023

Merits Review

NCAT Appeal Panel confirms s. 44(1)(b) of the Residential Tenancies Act 2010 does not impose a ‘duty’ on tenants to mitigate claims for rent reduction.

Halil v NSW Land and Housing Corporation [2023] NSWCATAP 72

Two appeals were brought before the Appeal Panel by a social housing tenant from two separate decisions made by the Tribunal in relation to termination and rent reduction. The appellant sought to argue that, if she was successful in her rent reduction appeal, the amount she would be “owed” by the landlord would offset the rent she owed and thus operate as a defence to the termination.

The Appeal Panel observed that the tenant had recurrently failed to pay the rent she had agreed to pay and refused to allow the landlord to effect maintenance and repairs. It held that any alleged complexity in the matters arose from the tenant’s own conduct in the proceedings including her numerous attempts to obtain adjournments, failures to appear, unstructured assertions and misconceptions repeated often and at length. The Appeal Panel did not see merit in any of the grounds alleged and refused to extend time for the appeal.

The Appeal Panel found there was a lack of useful and relevant submissions on, and hence no merit in, any of the grounds of appeal, save for one, in relation to which the Tribunal arrived at the correct result but for the wrong reasons. The Tribunal had wrongly held that the tenant had a duty to mitigate her losses in a claim for rent reduction under s. 44(1)(b) of the Residential Tenancies Act 2010; nor is there any provision contained in the Act requiring tenants to mitigate their claims for rent reduction.

The decision can be accessed here.

Business records evidencing association and contravention of COVID-19 public health orders may be relevant when determining an application for a firearms licence

Metleg v Commissioner of Police, NSW Police Force [2023] NSWCATAD 17

The applicant sought administrative review of the respondent’s decision to refuse to grant him a firearms licence under the Firearms Act 1996. At issue was whether the applicant was a fit and proper person to hold a licence and whether the issue of the licence would be contrary to the public interest.

The respondent submitted that the Tribunal should affirm the original decision as the applicant remains closely associated with his brother. This submission relied on business records which indicated that the applicant sold two companies to his brother in 2018 and that he is a joint director and shareholder in a company with his brother. The respondent also submitted that the applicant’s recent conduct in seeking to circumvent the requirements of the COVID-19 Public Health Orders was relevant to the matters before the Tribunal.

The applicant denied that he was associated with his brother and provided evidence to address and explain the business records. He also submitted that he had not intended to circumvent the COVID-19 Public Health Orders and that, in any case, that conduct was not relevant to the Tribunal’s determination.

The Tribunal affirmed the respondent’s decision. It held that the business records indicated that the applicant had an ongoing association with his brother. It also held that the COVID-19 Public Health Orders had a similar regulatory intent to the Firearms Act 1996 and, as such, non-compliance with those Orders was relevant to the determination of the matter.

The decision can be accessed here.

Extended trading hours extended on review

Ireson and Anor v Independent Liquor and Gaming Authority [2023] NSWCATAD 77

The applicants applied for an extended trading authorisation to be able to sell liquor to 3:00am on Monday to Saturday and 12:00am on Sunday at its licensed premises. The Independent Liquor and Gaming Authority (“the Authority”) granted the applicants an extended trading authorisation to 2:00am on Thursday to Saturday and to 11:00pm on Sunday. The applicants sought administrative review of the Authority’s decision.

The applicants submitted that regard should be had to the actual evidence concerning the licensed premises, which demonstrated that the premises is well regarded in the community, the extended trading hours sought were supported by various community organisations and that there are no issues or problems with problem gambling. There was also no evidence to demonstrate that the operation of the extended trading authorisation that had been granted had resulted in any detrimental impacts upon the local or broader community.

The Authority submitted that it had achieved the right balance in partially granting the applicants the extended trading hours sought. The overall evidence did not indicate that the measures put in place would effectively mitigate the impact greater access to gaming machines through the extended trading hours would have on problem gambling.

The Tribunal varied the Authority’s decision and extended the applicants’ extended trading authorisation to 2:00am on Monday to Saturday and 12:00am on Sunday. Having regard to the increased risk of problem gambling after 2:00am, the Tribunal was not satisfied that it was appropriate to permit extended trading after 2:00am.

The decision can be accessed here.

Offence committed by an employee, without more, does not enliven the demerit points scheme under Pt 9A of the Liquor Act 2007

Penplay Pty Ltd v Independent Liquor and Gaming Authority [2023] NSWCATAD 52

The applicant licensee applied for administrative review of the decision of the Authority to impose a condition on its licence to maintain an incident register under Pt 9A of the Liquor Act 2007 after one of the applicant’s employees received and paid a penalty notice for selling alcohol to a minor on the licensed premises.

The applicant submitted that the Authority’s decision should be set aside as its power to impose a condition under Pt 9A had not been enlivened as the applicant itself had not committed a demerit offence (that is, been convicted of or received a penalty notice or a penalty enforcement order in relation to the offence).

The Authority submitted that the applicant was subject to Pt 9A when its employee received and paid a penalty notice due to the deeming effect of s. 149. In the alternative, the Tribunal should still impose the condition on the licence by exercising the Authority’s general condition-making power under s. 53 via s. 63(2) of the Administrative Decisions Review Act 1997.

The Tribunal held that the Authority’s power to take remedial action and impose a condition under Pt 9A had not been enlivened as the applicant licensee had not committed a demerit offence and set aside the Authority’s decision. The Tribunal did not consider it had the power to exercise the Authority’s power under s. 53 of the Liquor Act as whether to exercise that power was not a decision before the Authority to determine at the time it purported to impose a condition on the applicant’s licence under Pt 9A.

The decision can be accessed here.

No primary production exemption for horses maintained on land under s. 10AA of the Land Tax Management Act

Ferella v Chief Commissioner of State Revenue [2023] NSWCATAP 50

The appellant appealed on the basis that the Tribunal below had erred in finding that her (non-rural) land in Box Hill was not entitled to a primary production exemption under s. 10AA of the Land Tax Management Act. The evidence before the Tribunal was that there were up to seven horses maintained on the land as broodmares. However, there was a dearth of supporting evidence regarding their maintenance on the land for the purpose of sale or natural increase, or for a commercial purpose. The Tribunal found that the appellant had not discharged her onus to establish her entitlement to the exemption claimed, failing on both the primary production as well as the commerciality test.

The Appeal Panel found that the Tribunal’s processes were both orthodox and rational. In its view, the Tribunal had objectively considered all the parties’ evidence in relation to the use of the land and had, in the circumstances, attached the appropriate weight to the appellant’s intention in respect of the land’s use. The Appeal Panel also affirmed the factors discussed by White J in Vartuli v Chief Commissioner of State Revenue [2014] NSWSC 678, as relevant in assessing the commerciality of the operation for s.10AA purposes.

Accordingly, the Appeal Panel concluded that the Tribunal had committed no error of law and refused leave on the merits, on the basis that the Tribunal’s conclusions were “clearly open on the material before it”, there being no “obvious errors”.

The decision can be accessed here.

Appeal Panel emphasises need for the just, quick and cheap resolution of real issues in dispute

Zwolinski J E v Chief Commissioner of State Revenue [2023] NSWCATAD 42

In this matter, the Tribunal found that, even taken at its highest, the applicant’s case was untenable and could not succeed and was therefore misconceived or lacking in substance for the purposes of s. 55(1)(b) of the Civil and Administrative Tribunal Act 2013 (“the CAT Act”). It was not disputed that the applicant was not in Australia for 200 days or more during the 2018 calendar year (for the purposes of surcharge land tax liability for the 2019 land tax year). Therefore, she was not “ordinarily resident” in the requisite sense for the purposes of the definition of “foreign person” under the Land Tax Act 1956, and no exemption (including under s. 5B of that Act) otherwise applied in respect of the 2019 land tax year.

There being no question of fact in this case and the law in relation to the definition of “foreign person” having been well settled, the Tribunal considered that the applicant’s case could not succeed. The Tribunal also considered the guiding principle of the CAT Act, being the facilitation of a just, quick and cheap resolution to the real issues in dispute, relevant in determining whether the application should be dismissed under s. 55(1)(b) of the CAT Act.

The decision can be accessed here.

Tribunal affirms land tax assessment, rejecting residence exemption for bridging visa holders

Azam Mohammed and Sarah Azam v Chief Commissioner of State Revenue [2023] NSWCATAD 38

In this matter, the Tribunal made orders confirming the respondent’s assessments imposing surcharge land tax under s. 5A of the Land Tax Act 1956 (“the LT Act”) in respect of a residential property owned by the applicants for the 2018 to 2022 land tax years.

The applicants were spouses who each held a one third interest in a residential property in Prestons (“the property”). Their son, Asim Azam, who is an Australian citizen, is the registered proprietor of the other one third interest in the property. The applicants are citizens of Pakistan who each hold a Bridging Visa class WA/010. Under the bridging visa, the applicants have unlimited work and study entitlements. Except for Mr Mohammed’s short period outside Australia in 2013, they have resided in Australia continuously since 2006. The applicants each acquired their respective one third interest in the property on 12 April 2016 and have resided in the property as their principal place of residence since it was first acquired. For each of the relevant taxing dates for the 2018-2022 land tax years, the applicants were in Australia for a period of 200 days in the year prior.

The Tribunal decided that the correct and preferable decision was to affirm the respondent’s decision, concluding that: (1) there was no dispute that the applicants were both in Australia for 200 days or more during the period 12 months preceding each of the taxing dates. However, as the applicants were holders of bridging visas at each of the relevant taxing dates, they were not ordinarily resident and were therefore “foreign persons”; (2) as the applicants were the holders of bridging visas, which are a class of temporary resident visas, they are not “permanent residents” and therefore do not satisfy the criteria for the principal place of residence exemption in s. 5B of the LT Act; (3) As the Tribunal had already determined that the statutory criteria for the principal place of residence exemption had not been met in this case and as there was no other statutory power to exempt the applicants from surcharge land tax based on unfairness, the applicants were not entitled to an exemption or waiver from the tax.

The decision can be accessed here.

No duty owed by Chief Commissioner of State Revenue to warn taxpayers of changes to Land Tax Act

Monisse v Chief Commissioner of State Revenue [2023] NSWCATAP 27

The appellant appealed the Tribunal’s decision to affirm the land tax Notice of Assessment dated 11 February 2021 (“the Assessment”). The Assessment retrospectively taxed the appellant’s discretionary trust for surcharge land tax from 2017-2021 because the appellant did not amend the relevant trust deed by 31 December 2020, as required by s. 5D of the Land Tax Act 1956 (“the LT Act”).

The appellant filed his Notice of Appeal late, claiming that the reason for the delay was that he was awaiting a determination on whether the decision from the proceeding below would be amended (for typographical errors) and because he initially made a complaint to the Tribunal, which advised him that the appropriate action was to lodge an appeal.

The grounds for the appeal were: (1) the Assessment and the decision in the proceedings below were unfair given the appellant’s record of always complying with his legal obligations and because he was not made aware of the changes to the LT Act; (2) the appellant suffered procedural unfairness because he raised a number of questions about the conduct of officers of the respondent, which were not answered.

The Appeal Panel concluded that: the respondent did not have a duty to answer the appellant’s questions and that the Tribunal, in the proceedings below, had correctly and without error dealt with these issues; matters relating to unfairness were not a basis to set aside the Assessment and no conduct or representation by the respondent could estop the respondent from issuing an assessment; there was no duty on the respondent to protect the taxpayer or to warn the taxpayer of a new tax.

The Tribunal concluded that leave should not be granted to the appellant to file his appeal late, despite the respondent consenting.

The decison can be accessed here.

Strong connection to Australian residence not enough to establish it as a ‘principal place of residence’ for the purposes of surcharge land tax

Matiushenko v Chief Commissioner of State Revenue [2023] NSWCATAD 25

The applicant is a citizen of the Russian Federation. He was made an Australian permanent resident in 2017. His wife owns a property in Vladivostok, Russia and works there as a notary. When the couple is in Russia, they reside at the Vladivostok property. They have a daughter and grandchildren living in Australia.

The applicant sought a review of the Chief Commissioner's decision to assess him as liable for surcharge land tax for a residential property in Sydney (“the Property”) for the 2018 to 2021 land tax years on the basis he was a foreign person having not been actually in Australia for 200 or more days in each of the relevant years.

The applicant argued that the Property was his principal place of residence because he stayed in Russia out of necessity rather than choice or preference. His wife worked in Vladivostok and he needed to be there for much of the year and his wife’s mother, a Vladivostok resident, was elderly and required attention and care. His connection to Australia was stronger than that to Russia because his family, being his daughter, son-in-law and grandchildren to whom he was connected by blood, all lived in Australia.

The Chief Commissioner submitted that, while the applicant’s biological family lived in Australia, his Russian family connection was still significant and that, in his submissions, the applicant had downplayed the importance of the connection to his mother-in-law

The Tribunal noted that Australia was very significant to the applicant but he still had significant connections to Russia through his wife’s work, his time spent there, and his mother-in-law. It found that he had two residences during the relevant years – in Sydney and Vladivostok but the Vladivostok property was his principal place of residence during the relevant years. The Tribunal ordered that the assessments of the Chief Commissioner relating to the applicant’s surcharge land tax liability for tax years 2018 to 2021 be confirmed.

The decision can be accessed here.

Applicants meet ‘foreign persons’ definition but do not satisfy ‘principal place of residence’ requirement

Wang v Chief Commissioner of State Revenue [2023] NSWCATAD 1

The applicants sought a review of the Chief Commissioner's decision to assess them as liable for surcharge land tax for a residential property in Oatlands, NSW (“the Property”) for the 2017 to 2022 land tax years on the basis they were foreign persons having not been actually in Australia for 200 or more days in each of the relevant years.

From 2016 to 2018, the applicants moved out of the Property in order to live nearer to their child’s school and rented the Property to others while themselves living in a rented house. The Property was leased to various tenants at all times during this period except for six days in 2016. In 2019, the applicants upgraded the kitchen in the Property as they did not intend to rent the Property out again. The applicants travelled to China in early 2020 with their child to live with the first applicant’s parents. The first applicant returned to Australia in September 2021, having been unable to return earlier due to the COVID-19 pandemic. The second applicant remained in China, stating that he felt obliged to stay in order to care for the first applicant’s elderly parents. The second applicant 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 living elsewhere in Sydney. The applicants again rented the Property out on a temporary basis while they were staying in China.

Both applicants met the definition of ‘foreign persons’ under s. 4 of the Foreign Acquisitions and Takeovers Act 1975 (Cth) as adopted by the LT Act during the relevant periods.

The Chief Commissioner submitted that the applicants did not satisfy the residence requirement in s. 5B(2) of the LT Act during the relevant period as they had not used and occupied the Property as their principal place of residence for 200 continuous days during the relevant years, and, accordingly, were not exempt from surcharge land tax.

The Tribunal decided that the land tax assessment for the first applicant in respect of the 2021 tax year was confirmed, and the land tax assessments for the second applicant in respect of the 2017, 2018, 2019, 2020, 2021 and 2022 tax years were confirmed.

The decision can be accessed here.

Rail workers to receive 1% pay rise above Wages Policy

Application by Sydney Trains [2023] FWCFB 52

By consent, Sydney Trains and NSW Trains (“the Rail Entities”) and a number of unions (“the Rail Unions”) agreed that the Fair Work Commission (“the Commission”) arbitrate two outstanding questions in relation to a new Sydney Trains and NSW Trains Enterprise Agreement 2022 regarding: (1) increases to remuneration effective between 1 May 2021 and 30 April 2024, and (2) the scope of the Higher Standards Cleaning (“HSC”) allowance.

The Rail Entities submitted that their wages position (2.53% from 1 May 2022 and 3.0% from 1 May 2023), excluding the $4,500 one-off payment, is consistent with the Wages Policy and is fair and reasonable. The Rail Unions submitted that fair and reasonable wages required yearly indexation plus wage growth.

The Full Bench placed limited weight on the Wages Policy. The Full Bench calculated that, on the Rail Entities’ position, the total change in the real value of remuneration is -9.2% over the term of the agreement. The Full Bench considered that the maintenance of real wages “should be treated as a medium- to long-term objective”, rather than achieved every year. The Full Bench also noted that providing an automatic wage indexation would require wage increases “completely out of touch with the wage increases given to other NSW public sector employees pursuant to the 2022 Policy and thus raises broader issues of equity”.

The Full Bench awarded the following additional increases: an additional 1% from 1 May 2022; an additional 1% from 1 May 2023. It acknowledged that these amounts constituted an evaluative judgment of what was fair and reasonable and declined to expand the scope of the HSC allowance to Customer Service Attendants for “reasons of merit, equity and practicality”.

The decision can be accessed here.

Other decisions in this issue

Last updated:

22 May 2023