Weidman and Secretary, Department of Housing and Construction [1986] AATA 502 (20 June 1986)

Last Updated: 21 January 2008

ADMINISTRATIVE APPEALS TRIBUNAL.

Housing and Construction - application for First Home Owners Grant -applicant's name on Certificate of Title - whether applicant previously owned a dwelling which was his principal place of residence - whether presumption of advancement rebutted to create resulting trust.

First Home Owners Act 1983 ss. 4, 5, 9, 14, 15(1), 16, 27,
First Home Owners Act Amendment Act 1985

Clapham and The Secretary, Department of Housing and Construction (21) November 1985)
Davies v National Trustees Executors & Agency Co. of Australia Ltd & Ors. [1912] VicLawRp 73; 1912 VLR. 397
Martin v; Martin [1959] HCA 62; (1959) 110 CLR 297.

DECISION AND REASONS

Re : ANDREW LEON WEIDMANN
(Applicant)

And : SECRETARY, DEPARTMENT OF HOUSING AND CONSTRUCTION
(Respondent)

T86/2
AAT Decision No 2712

Tribunal : Deputy President R.C. Jennings Q.C.，

Date: 20 June, 1986.

ADMINISTRATIVE APPEALS TRIBUNAL )
) T86/2 GENERAL ADMINISTRATIVE DIVISION )

Re: ANDREW LEON WEIDMANN

(Applicant)

And: SECRETARY DEPARTMENT OF HOUSING AND CONSTUCTION

(Respondent)

DECISION

Tribunal : Deputy President R.C. Jennings Q.C.,

Date : 20 June, 1986.

The decision under review is set aside and the matter remitted to the respondent for reconsideration in accordance with the direction that Andrew Leon Weidmann was, on 3 October 1983, a person to whom sub-section 14(2) of the First Home Owners Act 1983 applied in relation to the dwelling situated at and known as 61 Newdegate Street, Nest Hobart.

Sgd R.C. Jennings Presiding Member

ADMINISTRATIVE APPEALS TRIBUNAL )
) T86/2 GENERAL ADMINISTRATIVE DIVISION )

Re: ANDREW LEON WEIDMANN

(Applicant)

And: SECRETARY, DEPARTMENT OF HOUSING AND CONSTRUCTION

(Respondent)

REASONS FOR DECISION

This is an application made under Section 27 of the First Home Owners Act 1983 ("the Act") for review of a decision of a delegate of the Secretary to the Department of Housing and Construction ("the Department") affirming a decision that the applicant was not entitled to receive financial assistance under the Act.

The Tribunal had before it the T documents lodged by the respondent pursuant to Section 37 Administrative Appeals Tribunal Act 1975. Evidence was given at the hearing by the applicant, and by his parents Rose Weidmann and Gerard Weidmann.

The object of the Act is set out in Section 3 which reads:

"The object of this Act is to encourage and assist persons to purchase or build their own homes, and, in the construction and the administration of this Act, regard shall be had to that object."

What might be termed the operative provisions of the Act are sub-section 15(1) and Section 16 which read:

"15.(1) Where the person, or each person, who is a prescribed person in relation to a dwelling is a person to whom sub-section 14(2) applies in relation to the dwelling, an application for assistance in respect of the dwelling may be made in accordance with this section."

"16. Subject to this Act, the Secretary may pay, on behalf of the Commonwealth, financial assistance in accordance with this Act in respect of a dwelling to the applicant or applicants, as the case may be, for the assistance."

Sub-section 15(1) and Section 16 require the examination of a number of other provisions for their elucidation. A "'a prescribed person', in relation to a dwelling" is defined in sub-section 4(1) as "a person who is a prescribed person in relation to that dwelling by virtue of sub-section 14(1), other than a person in respect of whom a direction under section 5 is in force in relation to that dwelling". The relevant part of sub-section 14(1) reads:

"Where, on or after 1 October, 1983, a person (in this section referred to as the 'home acquirer') has -

(a) entered into a contract for the purchase of a dwelling situated in Australia;

then, subject to section 5 -

(d) the home acquirer

is, for the purposes of this Act, a prescribed person in relation to the dwelling."

Section 5 has no application to the present matter.

On 3 October 1983 the applicant entered into a contract for the purchase of a dwelling situate at 61 Newdegate Street, West Hobart. Accordingly, he is a prescribed person in relation to that dwelling by virtue of sub-section 14(1) and thereby satisfies the first of the two requirements in sub-section 15(1) for eligibility to apply for financial assistance. The question in issue is whether the applicant was, on 12 January 1984, the date on which he applied for financial assistance under the Act in respect of that dwelling, "a person to whom sub-section 14(2) applies in relation to the dwelling", so as to satisfy the second of those requirements.

Sub-section 14(2) provides, so far as relevant:

"Where a person is a prescribed person in relation to a dwelling and -

(a)

(b) before the date of the contract ... the prescribed person -

(i) had not owned a dwelling in Australia and -

(ii) ....

either alone or together with another person or other persons, the prescribed person is, for the purposes of section 15, a person to whom this sub-section applies."

Sub-section 14(5) is also relevant, and reads:

"For the purposes of paragraph (2Kb), a person or persons shall be taken not to have owned a dwelling, or been a party or parties to a contract for the purchase of a dwelling, during any period during which the dwelling was not the principal place of residence of the person or persons."

The decision under review is, in effect, that the applicant before the date of the contract which he entered into for the purchase of the dwelling, had owned a dwelling in Australia, being his principal place of residence for part of the time when he owned it. Accordingly, he was not a person to whom sub-section 14(2) applied and thus was not eligible to apply for financial assistance pursuant to sub-section 15(1).

In order to ascertain the meaning of the expression "owned a dwelling" in the Act, it is necessary to turn to sub-sections 9(1) and (2) which read, so far as relevant:

"9. (1) A reference in this Act to purchase, or to ownership, in relation to land or an undivided share in land, shall be read as a reference to purchase or ownership, as the case may be, otherwise than as trustee, of an approved interest in the land or in the undivided share, as the case may be.

(2) A reference in this Act to purchase, or to ownership, in relation to a dwelling, shall be read as a reference to purchase or ownership, as the case may be, otherwise than as trustee, of -

(a) the land on which the dwelling is ... erected."

"Approved interest" is given a number of meanings by sub-section 4(1). The only relevant meaning for present purposes is "An estate in fee simple".

A number of these provisions was amended by the First Home Owners Act Amendment Act 1985, but those amendments, by virtue of Section 14 of that Act, apply in relation to an application in respect of which the prescribed date (i.e. for present purposes, the" date of the contract, as to which see sub-section 4(1)) is a date later than 16 April, 1985. Accordingly, those amendments have no application to the present matter.

I accept the evidence given by the applicant and his parents and therefore find the facts I will now outline.

In 1981 the applicant was living with his parents, but decided that he would prefer to live away from home. His parents decided they would purchase a home unit at 13 Battery Square, Battery Point and permit their son and a friend to occupy it as their tenants. They had funds of about $22,000 for this purpose and arranged a loan of $14,000 to complete the purchase. They asked the applicant who is a solicitor to attend to the conveyancing.

Mrs Weidmann said that as her son was to be living in the unit she and her husband agreed to have his name put on the title so that he could "get involved with looking after the place". Mr. Weidmann confirmed this. They thought he would be more involved by being on the title.

They both made it plain that he made no financial contribution towards the purchase money and that they did not intend him to acquire any financial interest in the property. They also said that they could not have afforded to do that, and in any event they would not have done for one son what they could not have done for their other two sons.

The applicant paid rent during the whole of the time he lived at Battery Square and his friend who joined him a few months later paid the same amount direct to Mr and Mrs Weidmann. The total rent was a reasonable commercial rent and sufficient to meet annual outgoings, including payments on the mortgage.

When the property was sold in January 1984, the whole of the net proceeds was received by Mr. and Mrs. Weidmann.

Acting on his parents' instructions at the time of purchase the applicant prepared a transfer which had the effect when registered of placing the title in the joint names of himself and his parents as tenants in common in equal shares.

In the application for financial assistance which he signed on 24 October 1983 he revealed that he had had an interest in the property at Battery Square. On 21 October he had made a statutory declaration as to the circumstances in which he said, amongst other things:

"At the time that the contract for the purchase of the flat was signed, my parents offered to let me become a part owner of the flat to the extent that my name would appear on the Certificate of Title as a registered proprietor thereof. There was no real reason for such offer and it was solely made to the best of my knowledge and belief, as a gesture to me. At no time was any other situation envisaged than that above, that is to say, that I was to pay rent to them, that I would derive no benefit from the property, that they would be responsible for land tax and rates and that I did not have to pay any money whatsoever for the purchase of that property. It is in this sense that I state that I was in no way (in the real sense of the term) a part owner of the property at Battery Square, Battery Point".

The applicant based his case on a decision of this Tribunal of Clapham and The Secretary. Department of Housing and Construction (21 November 1985).

In that case one of the applicants had lent his father $1,0000 when he was 16. As a means of securing that loan the father requested his solicitor to put his son's name on the title. He thus became a tenant in common with his father.

He successfully contended that although he was registered as the proprietor of an estate in fee simple in an equal undivided half share in the land on which a dwelling was erected, he held that share as a trustee and not beneficially. Accordingly, it was said by virtue of the words "otherwise than as trustee" in sub-sections 9(1) and (2) he was not an owner of the land within the meaning of those sub-sections. Therefore, it was said, if he had not owned a share in the dwelling he came within sub- paragraph 14(2) (b)(i) and was thus a person to whom sub-section 14(2) applied so that he satisfied the second requirement of sub-section 15(1).

The applicant referred to paragraph 18 of the decision in Clapham which begins thus:

"Mr. Clarice emphasised that the Act should be interpreted in such a way as to promote its object which is set out in section 3. The whole of the purchase price on the original purchase of the property was in fact paid by Mr. Clapham Senior, albeit with the assistance of a loan from his son Gregory, which was fully repaid. The circumstances gave rise to a presumption of advancement in favour of the son: which presumption was, in its, turn rebuttable by evidence of. the intention of the parties, so as to create a resulting trust for the father".

The Tribunal then cited two passages from Davies v The National Trustees Executors and Agency Co. of Australasia Ltd [1912] VicLawRp 73; 1912 VLR 397 and noted that they had been approved by the High Court in Martin v Martin [1959] HCA 62; (1959) 110 CLR 297.

The High Court (at pages 304-5) cited two passages from the decision of Cussen J. in Davies case and made a comment of its own which is pertinent to the present cases

"... Cussen J. said:-

'It is impossible to try to arrange into certain sets of categories certain facts, and say beforehand they will or will not become decisive or immaterial. The attention must be kept steadily fixed on the one fact in issue - What was at the time the intention of the purchaser or transferor? Anything which is relevant to that issue is admissable. You may have the evidence of the purchaser or transferor himself, if he is alive, as to his mental condition in the past, and though in some circumstances such evidence should be received with caution, yet it may be accepted.'

His Honour's judgment, which contains a very clear formulation of the principles involved, makes it entirely a question of fact. The burden of proof is firmly placed upon the person asserting that a trust was intended but the issue depends upon the intention with which the property was purchased by the parent in the name of the child or the husband in the name of the wife or as the case may be.

'If on the whole of the evidence the Court is satisfied that the husband or father did not intend at the time of the purchase that his wife or child 3hould take by way of advancement, the rule of law is that there is a resulting trust for the husband or father. Similar rules apply where a transfer or assurance of property is made without consideration by a husband or father to a wife or child. It has been suggested in some cases that the presumption in favour of advancement is stronger in the case of a transfer than it is in the case of a purchase; but although this may be so in some circumstances, I think that no substantial distinction applicable universally can be drawn'."

In my opinion the evidence of the purchasers (Mr and Mrs Weidmann) has discharged the burden of establishing a resulting trust and rebutting a presumption of advancement.

Some reliance was placed by counsel for the respondent on inferences which he said should be drawn from the manner in which the parties treated the Battery Square property for income tax purposes. He also sought to draw an inference against a resulting trust in favour of the parents from the words used by the applicant in the statutory declaration made on 21 October 1983, namely "the offer was .... made ... as a gesture to me".

Neither of these matters displaces the firm conclusions I have arrived at upon consideration of the direct, reliable and truthful evidence of the applicant's parents as to their intentions at the time of purchase.

The decision under review will be set aside and the matter remitted to the respondent for reconsideration in accordance with an appropriate direction.