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Sides and Secretary, Department of Defence [2010] AATA 1071 (23 December 2010)

Last Updated: 6 January 2011

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2010] AATA 1071

ADMINISTRATIVE APPEALS TRIBUNAL )

) No 2009/5941

Applicant

Respondent

DECISION

Date 23 December 2010

Place Perth

..........[sgd S D Hotop]........

Deputy President

CATCHWORDS

DEFENCE – Defence Home Ownership Assistance Scheme (DHOAS) – applicant a serving member of Australian Defence Force – applicant applied for payment of subsidy under DHOAS in respect of a property (DHOAS property) – respondent authorised payment of subsidy to applicant – respondent subsequently revoked authorisation of payment of subsidy to applicant – applicant residing in a Service Residence and in DHOAS property – applicant occupying DHOAS property as a home – subsidy payable to applicant in respect of DHOAS property – payment of subsidy to applicant properly authorised – statutory preconditions for revoking authorisation of subsidy to applicant not fulfilled – power to revoke authorisation of subsidy to applicant not enlivened – decision under review set aside

 Defence Home Ownership Assistance Scheme Act 2008  (Cth),  s 3 ,  s 8 ,  s 16 ,  s 17 ,  s 27 , s 28 ,  s 29 ,  s 30 ,  s 32 , s 36,  s 39 ,  s 44 ,  s 66 ,  s 67  and  s 68 

Defence Home Ownership Assistance Scheme Regulations 2008, reg 6

Moses v Western Australia [2007] FCAFC 78; (2007) 241 ALR 268

REASONS FOR DECISION

INTRODUCTION

1. On 5 December 2008 Peter Sides (“the applicant”), a serving member of the Australian Defence Force, applied for a subsidy certificate under  s 14  of the  Defence Home Ownership Assistance Scheme Act 2008  (Cth) (”DHOAS Act”) for the purpose of obtaining a housing loan subsidy under that Act.
2. By letter dated 25 February 2009 an officer of the Department of Veterans’ Affairs (“DVA”) notified the applicant that his application had been successful, and a subsidy certificate was issued to him on 26 February 2009.
3. The applicant was subsequently notified by the DVA, by letter dated 5 May 2009, that his “monthly subsidy payments” under the Scheme would commence on 1 June 2009, that payment being his “payment for the month of May”.
4. On 9 June 2009, however, an officer of the DVA notified the applicant that he was not entitled to payment of the subsidy because he did not satisfy s 32 of the DHOAS Act and that the authorisation of the payment of the subsidy must be revoked under s 44(2)(c) of the DHOAS Act.
5. By letter dated 30 June 2009 the applicant requested an internal review of the decision of 9 June 2009.
6. On 26 October 2009 a delegate of the Secretary, Department of Defence (“the respondent”) confirmed the decision of 9 June 2009.
7. The applicant has applied to the Tribunal for review of the respondent’s decision of 26 October 2009.

THE EVIDENCE

8. The evidence before the Tribunal comprised:
   • the “T Documents” (T1–T13, pp 1–75) lodged by the respondent in accordance with s 37 of the Administrative Appeals Tribunal Act 1975 (Cth);
   • bundle of documents filed by the applicant on 16 November 2010 (Exhibit A1);
   • Defence Determination 2005/15 (Exhibit R1);
   • bundle of National Australia Bank documents filed by the respondent on 15 October 2010 (Exhibit R2);
   • affidavit of Michelle Unkles, dated 12 October 2010 (Exhibit R3); and
   • the oral evidence of the applicant and of Michelle Unkles.

THE STATUTORY FRAMEWORK

9. The DHOAS Act is described, in its long title, as:

“ An Act to establish a scheme to provide financial assistance to members of the Defence Force, and certain other persons, for the purchase, maintenance and development of their homes, and for related purposes.”

10. Part 3 of the DHOAS Act deals with subsidy certificates. Section 14(2) provides that an application for a subsidy certificate must be in the approved form. Where an application for a subsidy certificate is made by a person in accordance with s 14, a decision to give, or to refuse to give, a subsidy certificate to that person must be made under s 16. Section 16(2) relevantly provides:

“ (2) The Secretary must give a subsidy certificate to the applicant if:
(a) section 17, 18, 19 or 20 applies; and
(b) either:
(i) the applicant has a service credit (see section 46); or
...”

Section 17 relevantly provides:

“ (1) Subject to this section, the Secretary must give a subsidy certificate to the applicant if the Secretary is satisfied that the applicant:
(a) is eligible; and
(b) does not hold a subsidy certificate that is in force; and
...”

11. Part 2 of the DHOAS Act deals with “eligibility”. Section 7 relevantly provides that a person is “eligible as ... (a) a serving member”. Section 8 relevantly provides:

“ (1) A person is eligible as a serving member at a particular time (the eligibility time) if, at that time, the person:
(a) is a member of the Defence Force; and
(b) has completed (whether before, on or after the commencing day) the relevant qualifying service period under subsection (2).
(2) The qualifying service period for a serving member is:
(a) if the member is, at the eligibility time, a member of the Permanent Forces – 4 years of effective service; and
...”

In s 3 the phrase “effective service” is defined, “in relation to a person who is, or has been, a member of the Defence Force”, to mean:

“ ... service in the Defence Force by the person that:
(a) if the person has, at any time before, on or after the commencing day, stopped being a member of the Defence Force, and, more than 5 years later, again become a member of the Defence Force – does not include service before the person again became a member of the Defence Force; and
(b) in any case – is recognised as effective service in accordance with the regulations.”

Regulation 6 of the Defence Home Ownership Assistance Scheme Regulations 2008 (“the Regulations”) provides:

“ (1) Subject to subregulation (2), effective service means service:
(a) that is continuous full-time service; and
(b) in relation to which the member receives remuneration; and
(c) that is not ineffective service.
(2) For paragraph (1)(b), the member is taken to receive remuneration during a period of leave without pay if the period of leave is not more than 21 continuous days.”

12. Section 46 of the DHOAS Act provides a method of working out whether a person has a “service credit” within the meaning of s 16(2)(b)(i).
13. Division 1 of Part 4 of the DHOAS Act, which deals with entitlement to subsidy, contains the following relevant provisions:

“ 27 Entitlement — authorisation by Secretary
Authorisation of initial payment
(1) The Secretary must authorise the payment of subsidy to a person if subsidy becomes payable to the person under subsection 28(1).
Note: An authorisation under this subsection may be revoked under section 44. ...
(2) The Secretary:
(a) must refuse to authorise the payment of subsidy to a person under subsection (1) if subsidy has not become payable to the person under subsection 28(1); and
...

28. Entitlement — criteria

When subsidy becomes payable
(1) Subsidy becomes payable to a subsidised borrower in relation to a loan to the borrower if:
(a) the loan is made by a declared loan provider; and
(b) the loan is secured by a mortgage over an interest (including a leasehold interest) in land; and
(c) the conditions under Subdivision B are met.
(2) Subsidy becomes payable to a subsidised borrower with effect from the beginning of the monthly authorisation period during which subsection (1) starts to apply in relation to the borrower.
...

29. When subsidy becomes payable — eligibility and service credits

The following conditions must be met:
(a) a subsidy certificate held by the subsidised borrower must be in force;
(b) the subsidised borrower must have a service credit under section 46.
...

30. When subsidy becomes payable — use of subsidised loan

(1) The Secretary must be satisfied that the subsidised loan is used, or is to be used, to do one of the following:
(a) to buy the interest in land, if there is a house on the land;
...
(d) to discharge another loan used by the subsidised borrower for a purpose mentioned in paragraph (a), (b) or (c).

32. When subsidy becomes payable — occupation of house as a home (non-building loan)

Scope
(1) This section applies if the subsidised loan is:
(a) for the purpose covered by paragraph 30(1)(a) (to buy a house and land), or to discharge another loan for that purpose; and
(b) not for the purpose of building work, or to discharge another loan for that purpose.

Subsidy condition
(2) The Secretary must be satisfied that the subsidised borrower, or a dependant of the subsidised borrower, occupies a house on the land as a home.
Note 1: This condition need only be satisfied for the first year after the first authorisation day for the subsidy (see section 39).
...

36. When subsidy stops being payable — general

Subsidy stops being payable to the subsidised borrower, in relation to the entitlement period:
(a) if an event mentioned in an item in the following table occurs; and
(b) with effect from the start of the monthly authorisation period in which the critical time provided for that item occurs.

...

39. When subsidy stops being payable — occupation of house as a home (non-building loan)

Scope
(1) This section applies if the subsidised loan is:
(a) for the purpose covered by paragraph 30(1)(a) (to buy a house and land), or to discharge another loan for that purpose; and
(b) not for the purpose of building work, or to discharge another loan for such a purpose.
Subsidy condition
(2) At any time during the period covered by subsection (3), the subsidised borrower, or a partner or dependant of the subsidised borrower, must occupy a house on the land as a home.
(3) This subsection covers the period:
(a) starting on the first authorisation day for the subsidy; and
(b) ending:
(i) 1 year after that day; or
(ii) if the Secretary is satisfied that there are service requirements, or exceptional circumstances, justifying a shorter period of occupation — at an earlier time approved by the Secretary in writing.
...

44. Revocation of authorisation for the payment of subsidy

Scope
(1) This section applies if:
(a) the Secretary authorises the payment of subsidy to a subsidised borrower under section 27 in relation to a subsidised loan, on the basis of a subsidy certificate; and
(b) as a result, subsidy has been paid to the subsidised borrower during an entitlement period.
Revocation of authorisation
(2) The Secretary may, by written notice to the subsidised borrower, revoke the authorisation of the payment of subsidy to the subsidised borrower in relation to the entitlement period if the Secretary is satisfied that:
(a) the subsidy certificate ought not to have been given; or
(b) the subsidy certificate was only given because of a false or misleading statement by the subsidised borrower (or anyone else); or
(c) payment of subsidy at any time during the entitlement period was only made (or continued) because of a false or misleading statement by the subsidised borrower (or anyone else).
(3) The Secretary may give a notice under subsection (2) during the entitlement period, or at any time after the end of the entitlement period.
Effect of revocation
(4) If an authorisation is revoked under this section, subsidy is taken not to have become payable to the subsidised borrower during the entitlement period.
...”

14. Division 6 of Part 4 of the DHOAS Act, which deals with recovery of overpayments, contains the following relevant provisions:

“66 Recovery of overpayments—scope
(1) This Division applies if:
(a) the Secretary has paid an amount (the overpaid amount) to a loan provider as subsidy, by way of a payment into a subsidised loan account for the benefit of a subsidised borrower (the debtor); but
(b) the overpaid amount is not payable to the debtor under this Act.
(2) This Division applies in relation to a debtor who is not, or who has stopped being, a subsidised borrower as if the person were a subsidised borrower.

67 Recovery of overpayments—amount payable
(1) The debtor must pay the amount (the due amount) covered by subsection (2) to the Commonwealth.
(2) The amount covered by this subsection is the sum of the following:
(a) the overpaid amount;
(b) interest, at the general interest charge rate per day, on so much of the overpaid amount as remains unpaid from time to time after the overpaid amount was paid to the loan provider.
(3) In this section:
general interest charge rate means the general interest charge rate worked out under section 8AAD of the Taxation Administration Act 1953.
Note: The debt may be reduced (or discharged) under section 68 or 69.

68 Recovery of overpayments—from subsidised loan account
(1) The Secretary may, by notice in writing to the loan provider, recover the due amount (or a part of the due amount) by requiring the loan provider to:
(a) add an amount equal to the due amount (or part) to the principal outstanding of the debtor’s subsidised loan; and
(b) pay the due amount (or part) to the Commonwealth.
(2) If the loan provider receives a notice under subsection (1), the loan provider must comply with the notice in relation to the lesser of the following amounts (the loan account amount):
(a) the amount stated in the notice;
(b) the amount available for payment out of the debtor’s subsidised loan account in accordance with the terms of the debtor’s subsidised loan.
(3) Payment by the loan provider to the Secretary of the loan account amount is, to the extent of the payment, a discharge of any liability of the debtor to the Commonwealth under this Division.
...”

15. Part 5 of the DHOAS Act deals with review of decisions. Division 1 deals with “internal review” of “reviewable decisions”. Section 71 contains a list of the decisions under the Act which are “reviewable decisions”, including a decision under s 44(2) of the Act to “revoke an authorisation of the payment of subsidy”, and a decision under s 68(1) of the Act to “recover a due amount in the way provided by section 68”. Section 75 provides for the making of an “internal review decision” on review of a “reviewable decision”, and s 76 provides for external review by this Tribunal of an “internal review decision”.

THE FACTUAL BACKGROUND

16. The background facts are not in dispute and are as follows.
17. The applicant first enlisted as a member of the Regular Army on 15 May 1979 and he was discharged on 8 October 1993. He enlisted as a member of the Army Reserve on 4 November 2002 and completed continuous full-time service between 4 November 2002 and 16 July 2004. He transferred from the Army Reserve to the Regular Army on 23 July 2004 and has continued to be a serving member of the Regular Army from that date.
18. On 5 December 2008 the applicant made an application for a subsidy certificate in accordance with s 14 of the DHOAS Act. In Part A of the application form the applicant gave his “postal address” as: “...View Tce, Bicton, WA”. In Part D of the form, in response to the question:

“ Do you currently occupy any of the following? Service Residence
Rental accommodation property
On base accommodation
Other”

the applicant indicated “Rental accommodation property”. In Part F of the form the applicant indicated that the purpose of the proposed subsidised loan was to “refinance an existing loan”. (T4)

19. On 25 February 2009 a DVA officer decided that the applicant was eligible for a subsidy certificate under ss 16 and 17 of the DHOAS Act and that a subsidy was payable to him under s 28(1) of that Act in respect of his house at Coondle Drive, Coondle (Toodyay) WA (“the Coondle Drive property”) (T5).
20. By letter dated 5 May 2009 a DVA officer informed the applicant that he was entitled to “benefits under Tier 3 of the Scheme” and that his “monthly subsidy payments” would commence on 1 June 2009 (that payment being his “payment for the month of May”) and also informed him of the amount of his initial monthly payment. That letter was addressed to the applicant at the Coondle Drive property.
21. The abovementioned letter dated 5 May 2009 was returned unopened to the DVA on 20 May 2009. An internal departmental email, dated 10 February 2010, notes that:
    • a departmental staff member telephoned the applicant on 20 May 2009 regarding that letter and the applicant “advised that [the Coondle Drive property] did not have a postal service” and “indicated that he was not living in the property on a full-time basis”;
    • in a telephone conversation on 29 May 2009 the applicant advised a departmental staff member that “his primary residence was a DHA home in Bicton and that he visited [the Coondle Drive property] on weekends”. (T13)
22. On 9 June 2009 a DVA officer wrote to the applicant (at his address in View Terrace, Bicton) as follows:

“ I refer to your application for loan subsidy (sic) under the Defence Home Ownership Assistance Scheme (DHOAS) received by the Department on 5 December 2008, and your advice of 29 May 2009.
DECISION
You are not entitled to payment of the DHOAS subsidy at this time as you do not meet the Scheme’s criteria under S32 of the  Defence Home Ownership Assistance Scheme Act  (the Act).
 S32  requires you to occupy the home over which you have the DHOAS loan, as a condition of the subsidy commencing. As you are currently living in a Defence Housing Australia provided home located at ... View Terrace, Bicton, I do not consider that you are occupying the home at ... Coondle Dr, Coondle.
Accordingly, under  S44(2)(c)  of the Act, I must revoke authorisation for payment of subsidy under your Subsidy Certificate, number 12058.
...” (T7)

23. By letter dated 30 June 2009 the applicant sought an internal review of the decision of 9 June 2009 as follows:

“ ...
The home at ... Coondle Drive TOODYAY is my primary residence; I physically built it myself and have all my personnel (sic) effects there.
A brief history leading up to my situation; This house was built between 1998 and completed (sic) in 2000. I was living in Toodyay with my family when I reenlisted in Nov 2002. I took a posting to Singleton (unaccompanied) for 2 years. On my return to Perth I commuted to Swanbourne. I have a young family and the travel/time on deployment was impacting our relationship so we decided to move to Perth as my home is outside the reasonable travel range, and I was entitled to service accommodation.
I deployed to Afghanistan in 2007 and on my return I found myself separated. I am now divorced, and needed to refinance as part of the settlement. I spoke to the bank and refinanced my home.
I am forced to retain the unit at ... View Tce BICTON so that I have a Perth residence for my children when they are in my care. In a fortnight I spend 6/8 nights in Toodyay, approximately 4 at my girlfriend’s place in North Perth and about 3 in Bicton. The BICTON unit is unoccupied approx 10 out of 14 days. I would like to let Bicton go but that would be impractical as I need to maintain 2 bedrooms for my children, and my girlfriend and I are not yet at a stage were (sic) we would be comfortable living together as husband and wife.
...” (T8)

24. On 26 October 2009 a delegate of the respondent wrote to the applicant (at his address in View Terrace, Bicton) as follows:

“ I refer to your letter of 30 June 2009 to the Department of Veterans’ Affairs (DVA) in which you requested a review of the DVA’s decision to revoke the authorisation of the payment of the loan subsidy under  Section 44  of the  Defence Home Ownership Assistance Scheme Act 2008  (DHOAS Act). Your letter was forwarded to the Department of Defence on 8 July 2009 for its consideration.
Background
DVA determined that you were not entitled to the loan subsidy as you did not meet the 12 month occupancy requirement as provided under Section 32 of the Defence Home Ownership Assistance Act (sic) 2008 (DHOAS Act).
In your letter to DVA you maintained that you reside at your primary residence located in Toodyay approximately six to eight days each fortnight. You also advised that you are divorced and that you maintain a unit in Bicton, Perth for use when your children are in your care.
Review of DVA’s Decision
In reviewing DVA’s decision and based on your advice that you reside in your Toodyay property six to eight days each fortnight, I have determined that you do not meet the 12 month occupancy requirement, and concur with DVA’s decision to revoke the authorisation of the payment of subsidy. A condition for subsidy to become payable under Section 32 of the DHOAS Act is that a subsidised borrower occupies a house as a home for 12 months from the time their DHOAS loan is drawn down. In support of this decision, Defence Housing Authority (DHA) has confirmed that you relocated your family from your Toodyay address to a Service Residence at Bicton, and that you are currently occupying the Service Residence.
...” (T1, pp 4–5)

THE APPLICANT’S EVIDENCE

25. The applicant’s oral evidence may be summarised as follows:
    • he bought the land in Coondle Drive, Toodyay in 1996 and then built a house on that land;
    • he and his family moved into the Coondle Drive property in 2000;
    • when he re-enlisted in November 2002 they were living in the Coondle Drive property and he commuted to the Swanbourne Army Barracks in Perth;
    • he was then posted to Singleton in New South Wales and his wife and two children remained in the Coondle Drive property;
    • in 2005 he was posted back to Swanbourne in Perth;
    • his wife wished to move from the Coondle Drive property back to Perth and he then organised rental accommodation for himself and his family in a 3-bedroom home unit in Bicton (“the Bicton property”) near Perth and they moved into the Bicton property in 2006;
    • he deployed to Timor in 2006 and to Afghanistan in 2007;
    • while he was away his wife and children continued to reside at the Bicton property until August 2007 when they moved out after his wife decided that she wanted a divorce;
    • he returned from Afghanistan in September 2007 and resided alone at the Bicton property;
    • he then had a serious motorcycle accident and was in “rehab” for 12 months and he continued to reside at the Bicton property;
    • in December 2008 when he applied for the subsidy certificate he was living in the two residences, namely, the Coondle Drive property from which he commuted to Swanbourne, and the Bicton property which he regarded as a “squat” for the times when his children stayed with him every second weekend;
    • these living arrangements continued until November/December 2009 when he gave up the rental of the Bicton property because of financial reasons, and from that time he has lived “exclusively” at the Coondle Drive property;
    • the Bicton property is privately owned and is leased by the Army and he rented it from the Army at a below-market rental;
    • even during the period 2005–2007 when his family was living in the Bicton property, he did “not really” regard that property as his family home;
    • he always intended the Coondle Drive property to be “home” and he has kept all his possessions and equipment there and he always “got back” there whenever he could;
    • his “personnel documents, personal and family photos ... tools, hobby equipment and vehicles” are kept at the Coondle Drive property;
    • his “firearms have always been licensed to, and stored at”, the Coondle Drive property;
    • he has never “rented out” the Coondle Drive property;
    • he has, at all material times, been listed on the electoral roll in the electorate in which the Coondle Drive property is situated;
    • if he had known that he would have to give up the Bicton property before he could be eligible for the DHOAS subsidy he would have done so, but his Army Liaison Officer was aware of his living arrangements and did not see any problem, and he used the Bicton property as his mailing address in his application for a DHOAS subsidy and he was never informed by the DVA that he would have to move out of that property.

THE EVIDENCE OF MICHELLE UNKLES

26. Ms Unkles was called as a witness by the respondent for the purposes of giving evidence regarding the departmental telephone calls to the applicant referred to in paragraph 21 above.
27. An affidavit of Ms Unkles, dated 12 October 2010, was tendered in evidence by the respondent (Exhibit R3). The contents of that affidavit are as follows:

“ 1. I am employed by the Department of Veterans’ Affairs (Department) as Team Support Officer, Defence Home Ownership Assistance Scheme (DHOAS).

2. In my role as Team Support Officer, I process applications for subsidy payment and review the work of others. I also look after our Change in Circumstance forms and manage the process for Appeals and Special Requests. I offer support to the team with regards to advice surrounding issues that arise on a daily basis.
3. I spoke with Mr Peter Sides by telephone on 20th of May 2009 because the letter sent to his Coondle address that informed him that he was eligible to receive payment of the subsidy was returned to the Department. Mr Sides informed me that his postal address was a PO Box at Toodyay and that no postal service delivered to Coondle. ...
4. The phone call on the 20 May 2009 prompted me to query the member’s primary address. On 29 May 2009, I telephoned Mr Sides to confirm that his primary residence was the property to which his subsidy payment for DHOAS was to be paid.

...

6. During the phone call, Mr Sides informed me of his living arrangements. He said words to the effect of ‘I drive home to Coondle on weekends’ and ‘I need the home in Bicton so I can see my children during the week’. I asked the client if he received DHA assistance on his home in Bicton and he responded that he did.
7. Based on this conversation I was not satisfied that Mr Sides’ primary residence was his Coondle home because Mr Sides had confirmed that he lived in his Bicton home during the week and his Coondle home only on weekends.

...”

28. Ms Unkles confirmed that she had signed the abovementioned affidavit and that she adhered to its contents. The applicant did not seek to cross-examine Ms Unkles although, in his evidence, he denied that he had told Ms Unkles that he saw his children “during the week” – that is, on weekdays – and he reiterated that he had access to his children only on weekends.

ADDITIONAL EVIDENCE

29. The applicant tendered in evidence a bundle of documents (Exhibit A1) including the following:
    • the cover pages of his tax returns for the years 2004/2005, 2005/2006, 2006/2007 and 2007/2008, on all of which his postal and home address is a PO Box at Toodyay;
    • a letter dated 1 November 2010 from Carey Williamson, addressed “To whom it may concern”, which states as follows:

“ In January 2006 my former husband Peter Sides and I took residence of Defence rental accommodation in View Tce Bicton. This became necessary in our situation of Peter’s work at Campbell barracks and my need to aid my elderly parents living in the Fremantle area.
As lot ... Coondle Drive in Toodyay was well established as our primary home and the need to reside in the metropolitan area was considered temporary, we moved only essentials (some clothes, children’s toys and play equipment) to the new address. We left our furniture and most of our belongings in our home in Toodyay and bought new basic furnishings and appliances for the rental. We continued to spend as much time as possible maintaining our home in Toodyay.
Today my children’s home in Toodyay with their father remains a very important part of their lives. They have early childhood memories there through to the present. Their father has built them a wonderful home and provides a happy, adventure filled lifestyle that they look forward to and love.”;

• a letter dated 1 November 2010 from Greg Downie, addressed “To whom it may concern”, which states as follows:

“ I have known Peter Sides for around 12 years. During the majority of this time he has resided at lot ... Coondle Dve, Coondle/Toodyay.
I am aware that during this time there have been periods where Peter has been overseas and away from Toodyay undertaking training or personal business. Notwithstanding these periods Peter has maintained his property at the above address and returned to it as often as possible.
From 1998 to 2001 I operated as a plumber and undertook various plumbing jobs at the above address while Peter was building his house and living there. From 2001 to now Peter has maintained an active account at the hardware store I operate with my wife. Monthly purchases during this time are typical of most residents in the area and Peter rarely has a month with nil transactions.”.

The Tribunal notes that Mr Downie’s address, as stated in the abovementioned letter, is in Toodyay and his email address is at “toodyayhardware”. The respondent did not require either Ms Williamson or Mr Downie for cross-examination and the abovementioned letters were tendered by consent.

30. The respondent tendered in evidence a bundle of documents (Exhibit R2) comprising the following:
    • copy of the applicant’s application to National Australia Bank (“NAB”), dated 19 August 2008, for a loan to be secured by the Coondle Drive property;
    • copy of the applicant’s Home Loan contract with NAB in respect of a “NAB Defence Force Home Loan – Variable Rate”, dated 19 March 2009;
    • copy of a letter (undated) from NAB to the applicant confirming that the funds provided by the abovementioned NAB Defence Force Home Loan had been distributed in accordance with his instructions.

ANALYSIS

31. It is common ground that, when the applicant applied for the relevant subsidy certificate on 5 December 2008, he was “eligible” (as defined in s 7(a) and s 8 of the DHOAS Act) and he did not then hold a subsidy certificate that was in force, within the meaning of s 17(1) of that Act.
32. It is also common ground that the preconditions for a subsidy becoming payable, specified in paras (a) and (b) of s 28(1), s 29 and para (d) of s 30(1) of the DHOAS Act, were satisfied in the applicant’s case.
33. The decision under review in the present case is an “internal review decision”, made under s 75(2) of the DHOAS Act, confirming a “reviewable decision” to revoke an authorisation of the payment of subsidy under s 44(2) of that Act.
34. The exercise of the power conferred by s 44(2) of the DHOAS Act to revoke an authorisation of the payment of subsidy is conditional upon the decision-maker’s being satisfied that either para (a), para (b) or para (c) of that subsection is fulfilled. The Tribunal will now consider whether any of those paragraphs is fulfilled in the circumstances of the present case.

Ought the subsidy certificate not to have been given to the applicant (s 44(2)(a))?

35. Section 16(1) of the DHOAS Act provides that s 16 applies if a person applies for a subsidy certificate in accordance with s 14. It is common ground that, on 5 December 2008, the applicant applied for a subsidy certificate in accordance with s 14. Section 16 therefore applies in the present case.
36. Pursuant to s 16(2) of the DHOAS Act a subsidy certificate “must” be given to the applicant if s 17, s 18, s 19 or s 20 applies. It is common ground that s 17 applies in the present case (see paragraph 31 above). In accordance with s 16(2), therefore, the respondent was obliged to give a subsidy certificate to the applicant in the present case.
37. It follows that it cannot be said that the subsidy certificate, which was given to the applicant on 26 February 2009 in response to his application of 5 December 2008, “ought not to have been given” (within the meaning of s 44(2)(a) of the DHOAS Act) to him.
38. Accordingly, the Tribunal is not satisfied that para (a) of s 44(2) of the DHOAS Act is fulfilled in the present case.

Was the subsidy certificate only given to the applicant “because of a false or misleading statement by the subsidised borrower (or anyone else)” (s 44(2)(b))?

39. It is common ground that the applicant is the relevant “subsidised borrower” within the meaning of s 44(2)(b) of the DHOAS Act.
40. The respondent submitted that the applicant’s statement, in his application for a subsidy certificate on 5 December 2008, to the effect that he was currently occupying a “rental accommodation property”, and (by implication) was not then occupying a “Service Residence” (see paragraph 18 above), was a false or misleading statement because the Bicton property, which he was then occupying, was a “Service Residence”.
41. The applicant’s evidence was that the Bicton property is privately owned and is leased by the “Army” and that, as at 5 December 2008, he was renting it from the “Army” at a subsidised rental. The respondent did not dispute that evidence, and the Tribunal accepts it. The applicant submitted that the Bicton property was appropriately described as a “rental accommodation property”, although he now accepts that it was a “Service Residence”.
42. Even if, however, the applicant made a false or misleading statement in his application for a subsidy certificate by indicating that he was currently occupying a “rental accommodation property” and not a “Service Residence”, it cannot be said that the subsidy certificate was only given to him because of that false or misleading statement, for the purposes of para (b) of s 44(2) of the DHOAS Act. As previously stated, the subsidy certificate was given to the applicant on 26 February 2009 in accordance with the obligation imposed by s 16(2) of the DHOAS Act. That statutory obligation was not affected by the abovementioned statement of the applicant. Indeed, the fact that the applicant was occupying a “Service Residence” at the time when he applied for a subsidy certificate under the DHOAS Act was irrelevant to the making of a decision to give, or to refuse to give, a subsidy certificate to him under s 16 of that Act.
43. Accordingly, the Tribunal is not satisfied that para (b) of s 44(2) of the DHOAS Act is fulfilled in the present case.

Was “payment of subsidy [to the applicant] at any time during the entitlement period ... only made (or continued) because of a false or misleading statement by the subsidised borrower (or anyone else)” (s 44(2)(c))?

44. The abovementioned statement of the applicant regarding the nature of the premises occupied by him at the time when he applied for a subsidy certificate on 5 December 2008 is likewise irrelevant to the subsequent payment of subsidy to him on and from 1 June 2009. The identification of any other “false or misleading statement”, for the purposes of s 44(2)(c) of the DHOAS Act, is somewhat problematic.
45. It seems to the Tribunal that, in the “reviewable decision” of 9 June 2009 (see paragraph 22 above), the allegedly false statement, on the basis of which that decision to revoke the authorisation of the payment of subsidy to the applicant was apparently made, was a statement to the effect that the applicant was “occupying the home at ... Coondle Dr, Coondle (Toodyay)”, when in fact he was “currently living in a Defence Housing Australia provided home located at ... View Terrace, Bicton”. Similarly, in the “internal review decision” of 26 October 2009 (see paragraph 24 above), it was noted that the applicant “maintained” that he resided at his “primary residence located in Toodyay (Coondle) approximately six to eight days each fortnight”, whereas the Defence Housing Authority had confirmed that he had “relocated [his] family from [his] Toodyay address to a Service Residence at Bicton”, and that he was “currently occupying the Service Residence”.
46. At the hearing the parties presented their respective cases on the basis that the critical question for the Tribunal to decide was whether, on and from 1 June 2009 (being the date on which payment of subsidy to the applicant commenced), the applicant was “occupying” the Coondle Drive property “as a home”. It is common ground that, if that question is answered in the affirmative:
    • subsidy was payable to the applicant under s 28(1) of the DHOAS Act (see also ss 32(2) and 39(2), (3) of that Act);
    • payment of subsidy to him was properly authorised in accordance with s 27(1) of that Act; and
    • there was no basis for revoking that authorisation of payment of subsidy under para (c) of s 44(2) of that Act.
47. The words “occupies” and “home” are not defined in the DHOAS Act and, in the Tribunal’s opinion, there is no reason to suppose that the legislature intended each of those words to bear other than its ordinary meaning. It is appropriate, therefore, to have regard to dictionary definitions of those words.
48. In Macquarie Dictionary (5th ed), the noun “home” is appropriately defined as follows:

“1 a house, or other shelter that is the fixed residence of a person, a family, or a household”

and the verb “occupy” is appropriately defined as follows:

“5 to be resident or established in (a place) ... ”

In Moses v Western Australia [2007] FCAFC 78; (2007) 241 ALR 268 the Federal Court of Australia (Full Court) said (at 317):

“ The word ‘occupy’ ... has a common meaning of being established in a place.”

49. The applicant’s evidence was that, at all material times up until November/December 2009, he was living in the two relevant residences – namely, the Coondle Drive property from which he commuted to the Swanbourne Army Barracks, and the Bicton property which he regarded as a “squat” for the times when his children stayed with him every second weekend. In the applicant’s letter of 30 June 2009 (see paragraph 23 above), whose contents he reiterated in his oral evidence, he stated:

“ In a fortnight I spend 6/8 nights in Toodyay, approximately 4 at my girlfriend’s place in North Perth and about 3 in Bicton.”

He also said that he has never “rented out” the Coondle Drive property and that he has always intended it to be “home” and that he has always kept his personal effects and documents, family photographs, tools and equipment and other possessions at that property.

50. As regards Ms Unkles’ evidence (see paragraph 27 above) that, on the basis of her telephone conversation with the applicant on 29 May 2009, she formed the opinion that the Coondle Drive property was not his “primary residence” and that his “primary residence” was the Bicton property, the Tribunal is of the opinion that the contents of that conversation were somewhat vague and lacking in detail and constituted an inadequate basis for the formation of that opinion. Accordingly, the Tribunal does not regard Ms Unkles’ evidence as of assistance in this matter and it attaches little weight to it.
51. The Tribunal accepts the applicant’s evidence as summarised in paragraph 49 above, and the contents of Ms Williamson’s letter of 1 November 2010 set out in paragraph 29 above. Indeed, the respondent did not seek to dispute that evidence at the hearing but rather submitted that the applicant’s evidence that “he only occupied the [Coondle Drive property] as little as six to eight days in a fortnight” supported its contention that that property “was not the applicant’s home (main residence)”.
52. The respondent’s abovementioned reference to “home (main residence)” – which, the Tribunal notes, is similar to Ms Unkles’ reference to “primary residence” – is consistent with the Explanatory Memorandum relating to the Defence Home Ownership Assistance Scheme Bill 2008 (being the Bill for the DHOAS Act) which was cited by the respondent in its statement of contentions in this matter. In relation to clause 32 of that Bill (see s 32 of the DHOAS Act) the Explanatory Memorandum states (at para 55):

“ This clause provides that the house must be occupied by the subsidised borrower or their family in order for subsidy to become payable. The clause, in combination with clause 39, places a minimum time period of one year on the occupancy. The clause is intended to ensure that the home is the person’s main residence and not an investment property. ...”

53. Neither s 32(2) nor s 39(2) of the DHOAS Act, however, refers in terms to occupation of the relevant house by the subsidised borrower as their “main residence” or “primary residence”. Each of those subsections instead refers to occupation of the relevant house “as a home”. In the Tribunal’s opinion neither s 32(2) nor s 39(2) of the DHOAS Act is ambiguous or obscure and it is unnecessary, and indeed inappropriate, to have regard to the abovementioned Explanatory Memorandum for the purpose of interpreting and applying those provisions: see s 15AB(1) of the Acts Interpretation Act 1901 (Cth). As mentioned above, each of those provisions – in particular, the words “occupies” and “home” – should be interpreted literally in accordance with its ordinary meaning.
54. In the present case the Tribunal is satisfied that at all material times – including in and from May 2009 – the applicant has “occupied”, within the meaning of ss 32(2) and 39(2) of the DHOAS Act, the Coondle Drive property in the sense that he has resided there and been established there throughout that period, albeit that he has regularly spent approximately 3–4 nights each week away from that property. The applicant, furthermore, has had exclusive control of that property throughout that period.
55. The Tribunal is also satisfied that at all material times – including in and from May 2009 – the applicant has “occupied” the Coondle Drive property “as a home”, within the meaning of ss 32(2) and 39(2) of the DHOAS Act, in the sense that he has, throughout that period, occupied (as described above) that house as a fixed residence.
56. Although neither s 32(2) nor s 39(2) of the DHOAS Act refers to occupation of the relevant house as a “main residence” (compare, for example, s 118.110 of the Income Tax Assessment Act 1997 (Cth)), the Tribunal will, having regard to the reference to “main residence” in the abovementioned Explanatory Memorandum and to the respondent’s contentions, consider that issue. On the basis of the applicant’s evidence, the Tribunal is satisfied, and finds, that the Coondle Drive property has at all material times – including in and from May 2009 – been occupied by the applicant as his main home or residence. The Tribunal accepts that the applicant also resided at the Bicton property in the period from May 2009 until November/December 2009 but, in its opinion, the Coondle Drive property, rather than the Bicton property, was his main home or residence throughout that period. In forming that opinion, the Tribunal has had particular regard to the following evidence (which it accepts) given by the applicant:
    • he spent approximately twice as many nights per fortnight at the Coondle Drive property (“6/8”) than at the Bicton property (“about 3”);
    • he kept his important personal papers, personal effects, possessions and equipment at the Coondle Drive property;
    • he provided a PO Box in Toodyay (where the Coondle Drive property is situated) as the address for the mailing of accounts and taxation papers to him;
    • he continued to be listed on the electoral roll in the electorate in which the Coondle Drive property is situated;
    • he has at all times intended the Coondle Drive property to be his “home” and regarded it as “home”, whereas he has never regarded the Bicton property as “home” but rather regarded it as a “squat”.

The Tribunal also notes that, at all material times, the applicant was the registered proprietor of the Coondle Drive property, whereas he was a lessee of the Bicton property. The Tribunal accepts the applicant’s evidence that he has never “rented out” the Coondle Drive property.

57. Having regard to the whole of the evidence before it, the Tribunal is of the opinion that there is no basis on which it might be satisfied that “payment of subsidy [to the applicant] at any time during the entitlement period was only made (or continued) because of a false or misleading statement by the subsidised borrower [namely, the applicant] (or anyone else)”, within the meaning of s 44(2)(c) of the DHOAS Act.
58. Accordingly, the Tribunal is not satisfied that para (c) of s 44(2) of the DHOAS Act is fulfilled in the present case.

CONCLUSION

59. The Tribunal concludes, therefore, that the power, conferred by s 44(2) of the DHOAS Act, to revoke the authorisation of the payment of subsidy is not enlivened in the applicant’s case and, accordingly, the decision under review must be set aside.
60. Before parting with this case, however, it is appropriate that the Tribunal also comment on the following matters.
61. The respondent submitted, relying on Chapter 7 of Defence Determination 2005/15 made under s 58B of the Defence Act 1903 (Cth), that the applicant “cannot contemporaneously receive from his employer the benefit of both service accommodation and the DHOAS subsidy”. The respondent submitted that the applicant’s simultaneously receiving Defence housing assistance by way of the provision of a Service Residence (namely, the Bicton property) at a subsidised rental and, in addition, payment of subsidy under the DHOAS Act in respect of the Coondle Drive property, would constitute “double dipping” which is not permissible. The Tribunal notes, however, that the applicant’s entitlement to the payment of subsidy under the DHOAS Act is entirely governed by the provisions of that Act and the Regulations , and there is no provision in that Act or the Regulations which expressly precludes the applicant from becoming entitled to the payment of subsidy under that Act merely by reason of his simultaneously receiving the abovementioned form of Defence housing assistance. Whether, on the other hand, the payment of subsidy under the DHOAS Act to the applicant might affect his entitlement to continue to receive Defence housing assistance under Chapter 7 of Defence Determination 2005/15 is not a matter for the Tribunal’s consideration in the present case.
62. Finally, the Tribunal has reservations regarding the appropriateness of the respondent’s seeking to rely on s 44(2) of the DHOAS Act for the purpose of making a decision regarding the applicant’s entitlement to the payment of subsidy under that Act in the circumstances of the present case.
63. It seems to the Tribunal that if (as in the present case) the respondent is satisfied that an overpayment of subsidy has been made to a subsidised borrower, either in circumstances where subsidy had not become payable under Subdivision B of Division 1 of Part 4 of the DHOAS Act, or in circumstances where subsidy had stopped being payable under Subdivision C of Division 1 of Part 4 of that Act, the appropriate action for the respondent to take is to make a decision to recover the “due amount” under s 68(1) of that Act. Such a decision will be a “reviewable decision” under s 71 of that Act.
64. As discussed above (see paragraphs 34–58), the power to revoke an authorisation of the payment of subsidy, conferred by s 44(2) of the DHOAS Act, may only be exercised upon satisfaction of the circumstances referred to in para (a), para (b) or para (c). The mere fact that payment of subsidy has been made in circumstances where subsidy had not “become payable” or had “stopped being payable”, under, respectively, Subdivision B or Subdivision C of Division 1 of Part 4 of the DHOAS Act, does not of itself enliven the power conferred by s 44(2) of that Act (contrary to the apparent view of the maker of the “reviewable decision” of 9 June 2009 (T7) and the maker of the “internal review decision” of 26 October 2009 (T1, pp 4–5 ) in this matter).

DECISION

65. For the above reasons the Tribunal sets aside the decision under review and, in substitution therefor, decides that:
    • subsidy became payable to the applicant under ss 28(1) and 32 of the DHOAS Act with effect from May 2009;
    • payment of subsidy to the applicant was properly authorised by the respondent in accordance with s 27(1) of the DHOAS Act;
    • subsidy did not stop being payable to the applicant under ss 36 and 39 of the DHOAS Act;
    • the power to revoke the authorisation of the payment of subsidy, conferred by s 44(2) of the DHOAS Act, is not enlivened in the applicant’s case.
      

I certify that the 65 preceding paragraphs are a true copy of the reasons for the decision herein of Deputy President S D Hotop

Signed: ...............[sgd D Brodie]........................

Associate

Dates of Hearing 30 August, 29 November 2010

Date of Decision 23 December 2010

Representative of the Applicant Self-represented

Counsel for the Respondent Mr M Palfrey

Solicitor for the Respondent Clayton Utz