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Rowan v Commissioner of State Revenue QCAT 151
QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL
Rowan v Commissioner of State Revenue  QCAT 151
Commissioner of State Revenue
General administrative review matters
7 June 2019
8 March 2019
The decision of the Commissioner of State Revenue made on 10 May 2018 is confirmed.
TAXES AND DUTIES – LAND TAX – LIABILITY FOR LAND TAX – Review of a decision of the Commissioner of State Revenue pursuant to section 69(2)(b) of the Taxation Administration Act 2001 (Qld) – where land tax assessment by the Commissioner is calculated on the basis that the applicant was an ‘absentee’ pursuant to section 31 of the Land Tax Act 2010 (Qld) – whether the applicant was ‘an absentee’ pursuant to section 31 of the Land Tax Act 2010 (Qld)
Land Tax Act 2010 (Qld)
Queensland Civil and Administrative Tribunal Act 2009 (Qld)
Taxation Administration Act 2001 (Qld)
The Commissioner of Taxation v Miller (1946) 73 CLR 93
Commissioner of Inland Revenue v Lysaght  AC 234
Gregory v Deputy Federal Commissioner of Taxation (WA) (1937) 57 CLR 774
Hafza v Director Generals of Social Security (1985) 6 FCR 444
Harding v Commissioner of Taxat ion (2018) FCA 837
Harding v Commissioner of Taxation (2019) FCAFC 29
Levene v Commissioners of Inland Revenue (1928) AC 217
Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355
Re Taylor; Ex parte Natwest Australia Bank Limited (1992)
37 FCR 194
Shah v Barnet London Borough Council (1983) 1 All ER 226
Shaw v Commissioner of Land Tax (1986-1987) 11 QLCR 4
APPEARANCES & REPRESENTATION:
S Lancaster, solicitor, of Cooper Grace Ward Lawyers
G Hartridge of Counsel
REASONS FOR DECISION
- On 10 August 2017, the Commissioner of State Revenue (“Commissioner”) issued a Land Tax Assessment Notice (“Assessment Notice”) to Mr Rowan for the 2017/2018 financial year regarding his land holdings in Queensland as at 30 June 2017 (“the Relevant Date”). The land tax assessment (“Assessment”) was calculated by the Commissioner on the basis that Mr Rowan was an ‘absentee’ pursuant to section 31 of the Land Tax Act 2010 (Qld) (“LTA”).
- In January 2017, Mr Rowan sent an email to the Commissioner attaching a completed Office of State Revenue Form LT 16 Land Tax absentee/resident notification together with other material. In this email, Mr Rowan requested the Commissioner to reassess the applicant as a ‘permanent’ resident for land tax purposes. On 31 January, the Commissioner notified Mr Rowan that his claim to be assessed as a ‘natural resident’ had been denied.
- By an email dated 6 February 2018, BDO (Qld) Accountants (“BDO”) for Mr Rowan lodged an objection to the Assessment (“Objection”) on the basis that Mr Rowan was a “natural resident”. This Objection consisted of a letter from BDO dated 5 February 2018, a formal submission and annexures (Part of Exhibit 1).
- The Commissioner responded to the Objection by way of an email dated 6 February 2018. In this email the Commissioner noted that the Objection was lodged outside the 60 day time limit (that is, 60 days from the date of the Assessment Notice as set out in section 65(1) of the Taxation Administration Act 2001 (Qld) (“TAA”)). Notwithstanding this issue, the Commissioner extended the time to lodge the Objection until 6 February 2018 pursuant to section 65(2) of the TAA.
- By an email dated 7 March 2018, the Commissioner wrote to BDO requesting further information. BDO provided a response to the Commissioner’s request by way of an email dated 21 March 2018 containing a letter dated 21 March annexing copies of certain documents (part of Exhibit 1).
- On 10 May 2018, the Commissioner wrote to BDO advising that the Commissioner has decided to disallow the Objection (part of Exhibit 1). It is this decision (“Decision”) that is the subject of these proceedings.
- Mr Rowan was born in Australia and is an Australian citizen.
- Mr Rowan at all relevant times was the owner of a property situated at 21 Gloria Street, South Golden Beach, New South Wales. It is referred to as ‘his home’ in his affidavit filed on 6 December 2018 (Exhibit 3).
- Mr Rowan built the home himself using recycled material between 1981 and 1989.
- Mr Rowan is also the owner of 5 house properties in Queensland. These properties are rented and managed by real estate agents and are the subject of the Assessment Notice.
- In his affidavit (Exhibit 3), Mr Rowan refers to his first wife and a daughter who was born in 1990. Mr Rowan separated from his first wife in 2009. Mr Rowan’s daughter lived in the home until 2010 when she left to attend university. She no longer lives in the home.
- Mr Rowan’s rental properties in Queensland supplement Mr Rowan’s employment income and support his family and lifestyle.
- Mr Rowan has a diploma in advanced education from North River College in Lismore, New South Wales and a Bachelor’s Degree and Masters Degree from Deakin University. During his working life, Mr Rowan worked at various jobs and he has a strong interest in early childhood development and he has written four books on this subject.
- From 1995 to 2000, Mr Rowan travelled overseas to various destinations with his first wife and daughter. Part of the time spent overseas was dedicated to providing assistance in children’s homes.
- From 1990, Mr Rowan leased the whole downstairs floor of his home to various tenants. Helen Stickley, in her affidavit filed on 19 December 2018 (Exhibit 5), says that the downstairs area of the home can be described as a separate apartment with its own security. The downstairs area of the home was rented during all relevant times and during the financial year 2016/2017.
- Ms Stickley in her affidavit (Exhibit 5) says that since 2008 she has been a tenant of part of the upstairs area of the home. The upstairs area is separated by a landing and can be separately secured.
- Part of the upstairs area of the home consists of Ms Stickely’s bedroom, another bedroom which Ms Stickely uses as a wardrobe/storage area and another room which Ms Stickley uses as an office. This area can be secured. Mr Rowan has a small bedroom and office which can also be secured. The upstairs area also has a kitchen, lounge/dining area, separate toilet and bathroom. It is not clear from Ms Stickley’s affidavit; however it appears that these facilities can be used by both Mr Rowan and Ms Stickley.
- Ms Stickley says that there is no formal lease arrangement with Mr Rowan and the upstairs area contains Mr Rowan’s furniture, documents and personal belongings. It is also used to store some of the belongings of Mr Rowan’s daughter. Ms Stickley says she also has some of her own furniture and belongings.
- It is apparent from Ms Stickley’s affidavit that she has access to Mr Rowan’s office and bedroom and she has used these facilities, on occasions, when Mr Rowan was overseas. Further, Ms Stickley says that when Mr Rowan was overseas she would collect his mail, and scan and email official-looking correspondence to him. The telephone service was in Mr Rowan’s name and Ms Stickley says that she would redirect certain calls to him.
- Ms Stickley also says in her affidavit that on occasions she accessed documents for Mr Rowan from his office and filing cabinets and emailed copies of these documents to him.
- Ms Stickely says in her affidavit that the living and tenancy arrangements set out above had been ongoing on the same basis from 2008 to 2018.
- Mr Rowan’s daughter does not live in the home but does visit the home on occasions to recover her belongings.
- In 2010, Mr Rowan purchased an ‘Around-the-World’ ticket and travelled to various destinations. He travelled to Brazil to volunteer at a spiritual healing centre. It was here that he met his current wife (Sarah), in 2010, and formed a relationship. Mr Rowan and Sarah married in May 2014.
- In June 2011, Mr Rowan and Sarah travelled to the USA to visit Sarah’s mother who died shortly after their arrival. It was around this time that Sarah commenced litigation with her sisters regarding her mother’s estate which was worth some $USD100 million. The litigation was complex and Sarah used five firms of lawyers in the USA. The litigation is still not resolved and Sarah has spent substantial sums of money paying her lawyers’ fees.
- Mr Rowan stayed in the USA to support Sarah in her litigation. It was their intention to return to Australia when the litigation in the USA was resolved.
- While Mr Rowan was in the USA, he mainly stayed in motels, hotels, inns and AirBnBs. He also at times travelled to Brazil. Mr Rowan also says that he and Sarah stayed for approximately six months in a house owned by Sarah’s mother. Mr Rowan says in paragraph 70 of his affidavit (Exhibit 3) that they eventually stayed in a condominium (condo) in California.
- In May 2015, Mr Rowan returned to Australia where he stayed in Brisbane and the home to do some work to his rental properties and replace a deck at his home.
- In June 2015, there was tension in the marriage, so Mr Rowan returned to the USA where he initially stayed in an AirBnB to be close to the condo where Sarah was living. Mr Rowan moved into the condo with Sarah at Christmas of that year.
- Mr Rowan stated in his oral evidence that, at times, Sarah would be living with him when he stayed at AirBnBs and motels.
- Mr Rowan returned to Australia in November 2017 because he says that he was concerned at the risk of being assessed as an ‘absentee’ for land tax purposes.
- Mr Rowan says that he purchased very few assets or property while he was in the USA and only travelled with his personal possessions and clothes. He always intended to return to Australia and to his home. When Mr Rowan was returning to Australia he always marked his immigration card as being a resident returning to Australia.
- While Mr Rowan was in the USA, Mr Rowan travelled to Brazil to volunteer for spiritual healing. Whilst in Brazil Mr Rowan stayed in low cost hotels and hostels.
- Around 2015, Mr Rowan obtained a USA Conditional Permanent Resident Card ‘green card’. He says he obtained this green card merely to make his entry into USA much easier.
- Mr Rowan says that at all relevant times he maintained the following in Australia:
- (a)bank accounts and credit cards;
- (b)Medicare card;
- (c)New South Wales Driver’s licence; and
- (d)his name on the electoral roll and continued to participate in Australian elections.
- Mr Rowan has also lodged income tax returns with the Australian Taxation Office as an Australian resident
- On 13 November 2018, the Applicant filed an application for directions with this Tribunal. This application sought to introduce new evidence. The evidence was an affidavit of the Applicant sworn on 4 December 2018 and filed on 6 December 2018 (Exhibit 3) and an affidavit of Helen Marjorie Stickley filed on 19 December 2018 (Exhibit 5). The Respondent filed a response to this application on 15 January 2019 (Exhibit 8). On 18 February 2019, Member Kanowski made an order as set out below:
- (a)The affidavit of Helen Marjorie Stickley filed on 19 December 2018 will be allowed as new evidence in the proceeding.
- (b)Peter Rowan is to ensure that Helen Marjorie Stickley is available for cross-examination by telephone during the hearing on 8 March 2019.
- (c)The affidavit of Peter Rowan filed on 6 December 2018, other than the portions identified in paragraph 20a of the submissions of the Commissioner of State Revenue filed on 15 January 2018 (‘the identified portions’) will be allowed as new evidence in the proceeding.
- (d)The question of whether the identified portions will be allowed as new evidence in the proceeding is to be decided by the Tribunal on 8 March 2019.
- (e)Peter Rowan is to file in the Tribunal two (2) copies and give one (1) copy to Commissioner of State Revenue of any available supporting documents for the evidence given in paragraphs 66 and 90 of his affidavit filed on 6 December 2018, by: 4:00pm on 5 March 2019.
- (f)The question of whether any documents provided under direction 5 are allowed as new evidence in the proceeding is to be decided by the Tribunal at the hearing on 8 March 2019.
- (g)Commissioner of State Revenue may cross-examine Peter Rowan at the hearing on 8 March 2019.
- The Respondent notified the Tribunal that Ms Stickley was not required for cross-examination. Accordingly Member Kanowski made an order on 7 March 2019 that Direction 2 of the order referred to in the previous paragraph is vacated and Ms Stickley is excused from appearing for cross-examination at the hearing on 8 March 2019.
Material for the Hearing
- The following is a list of the documents presented to the Tribunal:
- (a)Mr Rowan’s Application and material filed on 9 July/2018 (Exhibit 1).
- (b)Commissioner’s Response filed on 4 September 2018 (Exhibit 2).
- (c)Affidavit of Peter Rowan sworn on 4 December 2018 and filed on 6 December 2019 (Exhibit 3).
- (d)Affidavit of Peter Rowan sworn on 5 March 2019 and filed on 6 March 2019 (exhibit 4).
- (e)Affidavit of Marjorie Stickley sworn on 10 December 2019 and filed on 19 December 2019 (Exhibit 5).
- (f)Mr Rowan’s Preliminary submissions filed on 4 October 2018 (Exhibit 6).
- (g)Commissioner’s Preliminary Submissions filed on 19 September 2018 (Exhibit 7).
- (h)Commissioner’s Response to Applicant’s miscellaneous Application to allow new evidence filed on 15 January 2019 (Exhibit 8).
- (i)Mr Rowan’s Supplementary Submissions dated on 3 October 2018 (Exhibit 9).
- These proceedings were commenced on 9 July 2018 by Mr Rowan by way of application for a review of the Decision pursuant to section 69(2)(b) of the TAA (“Application”).
- Pursuant to section 69(1)(b) of the TAA Act there is a requirement for the amount of the land tax payable under an assessment to be paid before a taxpayer has a right of review of the Commissioner’s decision. In this case, the Commissioner has confirmed that Mr Rowan has paid the land tax of $14,404.60 owing under the Assessment Notice and confirmed in the Decision. Counsel for the Commissioner has confirmed that there are no jurisdiction issues preventing the review of the decision by QCAT.
- Section 71 off the TAA provides:
71 QCAT to decide review on evidence before the commissioner
(1) This section applies to a proceeding for a review by QCAT of a decision of the commissioner on an objection.
(2) The grounds on which the application for review is made are limited to the grounds of the relevant objection, unless QCAT otherwise orders.
(3) QCAT must—
- (a)hear and decide the review of the decision by way of a reconsideration of the evidence before the commissioner when the decision was made, unless QCAT considers it necessary in the interests of justice to allow new evidence; and
- (b)decide the review of the decision in accordance with the same law that applied to the making of the original decision.
(4) If QCAT decides, under the QCAT Act , section 139 , that the proceeding should be reopened, the issues in the proceeding that are reheard must be—
- (a)heard and decided by way of a reconsideration of the evidence given in the proceeding for the review of the decision; and
- (b)decided in accordance with the same law that applied to the making of the original decision.
(5) In this section—
“new evidence” means evidence that was not before the commissioner when the decision on the objection was made.
“original decision” means the assessment or reassessment that was the subject of the relevant objection.
“relevant objection” means the objection to which the decision of the commissioner relates.
- Pursuant to section 71(2) of the TAA, the grounds that QCAT can review are limited to the grounds contained in the Objection, unless QCAT otherwise orders. The central issue of the Objection and the Application is whether at the Relevant Date Mr Rowan was an ‘absentee’ pursuant to section 31 of the LTA. There are no additional grounds raised by Mr Rowan in the application for review by QCAT.
- Section 71(3) of the TAA states that:
QCAT must hear and decide the review by way of a reconsideration of the evidence before the Commissioner, unless QCAT considers it necessary in the interests of justice to allow new evidence.
- I have discussed this earlier and note that Member Kanowski made an order on 18 February 2019 and I have decided to allow this further evidence. This evidence is not critical and does not affect my decision.
- Sections 7, 8 and 9 of the LTA provide:
7 When a liability for land tax arises
A liability for land tax for a financial year arises at midnight on 30 June immediately preceding the financial year.
8 Who is liable to pay land tax
The owner of taxable land when a liability for land tax arises is liable to pay the tax.
9 Meaning of taxable land
Taxable land is land in Queensland that—
- (a)has been alienated from the State for an estate in fee simple; and
- (b)is not exempt land.
Acts Interpretation Act 1954, schedule 1 —
land includes messuages, tenements and hereditaments, corporeal or incorporeal, of any tenure or description, and whatever may be the interest in the land.
- Section 17 of the LTA provides:
17 Land Valuation Act value
The “Land Valuation Act value”, of land for a financial year, is its value under the Land Valuation Act when a liability for land tax arises for the financial year.
- Section 31 of the TAA provides:
31 Time for payment of late payment interest
Late payment interest is payable on the date it accrues.
- Pursuant to section 73 of the TAA, Mr Rowan has the onus of proving his case. Also, this is relevant to the wording of section 31(2)(a) of the LTA where an absentee includes a person who ‘cannot satisfy the Commissioner that he or she ordinarily resides in Australia’.
- The LTA imposes liability for land tax on taxable land on 30 June of each financial year. Further, a taxpayer’s liability is assessed on the total taxable value of all taxable land owned when the liability arises. This framework is set out in sections 6 to 8 inclusive and section 19 of the LTA.
- Section 32 of the LTA sets out the rate of land tax generally, and refers to various rates set out in the schedules to the LTA. If a taxpayer is assessed as an ‘absentee’ then that taxpayer pays a higher rate of land tax.
- The central issue in these proceedings is whether Mr Rowan ‘ordinarily resided’ in Australia on the Relevant Date pursuant to sections 31(1) or 31(2) of the LTA.
- Section 31(3) of the LTA does not apply to Mr Rowan as he is not a ‘public officer’ or ‘an employee absent in the performance of the employee’s duty for his or her employer.’
- Therefore a close examination of section 31(1) and 31(2) of the LTA is required. Section 31(1) of the LTA provides the basic definition of ‘absentee’. That is, ‘an absentee is a person who does not ordinarily reside in Australia’.
- Section 31(2) of the LTA sets out a framework of what is considered to be an ‘absentee’:
31 Meaning of absentee
- (2)An “absentee” includes a person who—
- (a)cannot satisfy the commissioner that he or she ordinarily resides in Australia; and
- (b)when ownership of the person’s land is decided for this Act—
- (i)is absent from Australia; or
- (ii)has been absent from Australia for more than half of the 12 month period ending when the ownership is decided.
- Section 31(2) of the LTA sets out a further refinement of the basic test of what is an ‘absentee’. That is, an ‘absentee’ is a person who cannot satisfy the Commissioner that he or she ordinarily resides in Australia and who is absent from Australia on the relevant date (i.e. 30 June of a particular year), or has been absent for the six month period leading up to the relevant date (i.e. 1 January to 30 June of a particular year). The criteria used by the Commissioner to determine whether a person ordinarily resides in Australia must be the same criteria used to make a determination in section 31(1) of the LTA. The further refinement in section 31(2) of the LTA is that the onus is on the person to satisfy the Commissioner. The test to satisfy the Commissioner involves an analysis of the facts and circumstances that I will discuss later, and the Commissioner must exercise this function reasonably and according to law. In my opinion, section 31(2) of the LTA is a means or a tool for the Commissioner to administer the LTA.
- Section 31(2) of the LTA can be used by the Commissioner to seek information from a taxpayer when the taxpayer who is not in Australia on 30 June or has not been in Australia for the six month period leading up to 30 June of any year. In these cases, the onus is on the taxpayer to prove to the Commissioner that the taxpayer ordinarily resides in Australia.
- In these proceedings the Relevant Date is 30 June 2017 and the six month period is 1 January 2017 to 30 June 2017.
- The Respondents contend that subsections 31(1) and (2) of the LTA should be read together to give full effect to the legislation. Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 (“Project Blue Sky”) is authority for this principle. In that case, the Court held at -:
The primary object of statutory construction is to construe the relevant provision so that it is consistent with the language and purpose of all the provisions of the statute. The meaning of the provision must be determined “by reference to the language of the instrument viewed as a whole”. In Commissioner for Railways (NSW) v Agalianos, Dixon CJ pointed out that “the context, the general purpose and policy of a provision and its consistency and fairness are surer guides to its meaning than the logic with which it is constructed”. Thus, the process of construction must always begin by examining the context of the provision that is being construed.
A legislative instrument must be construed on the prima facie basis that its provisions are intended to give effect to harmonious goals. Where conflict appears to arise from the language of particular provisions, the conflict must be alleviated, so far as possible, by adjusting the meaning of the competing provisions to achieve that result which will best give effect to the purpose and language of those provisions while maintaining the unity of all the statutory provisions. Reconciling conflicting provisions will often require the court “to determine which is the leading provision and which the subordinate provision, and which must give way to the other”. Only by determining the hierarchy of the provisions will it be possible in many cases to give each provision the meaning which best gives effect to its purpose and language while maintaining the unity of the statutory scheme.
Furthermore, a court construing a statutory provision must strive to give meaning to every word of the provision. In The Commonwealth v Baume Griffith CJ cited R v Berchet to support the proposition that it was “a known rule in the interpretation of Statutes that such a sense is to be made upon the whole as that no clause, sentence, or word shall prove superfluous, void, or insignificant, if by any other construction they may all be made useful and pertinent”. [Footnotes omitted].
- The principle in Project Blue Sky only applies when there is inconsistency, ambiguity or there is conflict in the legislation. In sections 31(1) and 31(2) of the LTA, the legislation is clear. Section 31(1) of the LTA sets out the basic definition of what is an ‘absentee’. Section 31(2) sets out a special category or a prima facie test of what is an ‘absentee’. That is if a person is not in Australia on 30 June or for the 6 months period leading up to the 30 June then the Commissioner can make enquiries with that taxpayer to provide information/documentation to the Commissioner to show that the taxpayer ordinarily resides in Australia.
- Mr Rowan was not in Australia in the 2016/2017 financial year. Accordingly, as at the Relevant Date Mr Rowan was prima facie an ‘absentee’ unless the facts and law show that he was an ordinary resident of Australia on the Relevant Date.
- Mr Rowan has the onus of proving that he was an ordinary resident of Australia on the Relevant Date. This is the case when a person lodges an objection to a land tax assessment (section 66 of the TAA Act), reviewed by QCAT (section 73 of the TAA) and, in section 31(2)(a) of the LTA.
- The questions I have to answer are:
- (a)Did Mr Rowan ‘ordinarily reside’ in Australia as at the Relevant Date (section 31(1) of the LTA)?
- (b)Or, given Mr Rowan was not in Australia on 30 June 2017, and not in Australia from 1 January 2017 to 30 June 2017, did Mr Rowan satisfy the Commissioner that he was an ordinary resident of Australia on 30 June 2017 (section 31(2) of the LTA)?
- The questions require an examination of the facts, the relevant legislation and authorities. There is no definition of the phrase ‘ordinarily reside’ in the LTA. Further, there is no assistance in the Explanatory Notes of the Land Tax Bill 2010.
- The wording of section 31 of the LTA is similar to section 3 of the Land Tax Act 1915 (Qld) which was superseded by the LTA. Section 3 of the Land Tax Act 1915 (Qld) uses the words ‘an absentee is a person who does not ordinarily reside in Australia…’ Further, in the superseded legislation there is a provision similar to section 31(2) of the LTA except that in the superseded legislation there is no mention of being in Australia on 30 June of any year and this legislation does not mandate that the 6 month period has to be the 6 month period immediately prior to 30 June of any year.
- There are no direct authorities on the interpretation of section 31 of the LTA. In Shaw v Commissioner of Land Tax (1986-1987) 11 QLCR 4, the Land Court of Queensland examined the words ‘absentee’ and ‘ordinarily resides’ in respect of the Land Tax Act 1915. This case is instructive and the Land Court referred to Levene v Inland Revenue Commissioners (1928) AC 217 (“Levene”) and Commissioner of Inland Revenue v Lysaght  AC 234 (“Lysaght”), the leading English authorities on this issue.
- Because there is no definition of ‘ordinarily resides’ in the LTA, it takes its ordinary meaning. The Oxford Dictionary definition of ‘reside’ is ‘to dwell permanently or for a considerable time, to have one’s settled or usual abode, to live in or at a particular place.’
- The authorities show that the concept of ‘residence’, place of abode and domicile are different from ‘ordinary residence’. The Commissioner of Taxation v Miller (1946) 73 CLR 93 (“Miller”) is a leading authority on this issue where the Court accepted the principle of ‘residence’. In Miller, the High Court accepted the principles outlined in Lysaght and Levene should be applied. In Miller, Latham CJ held at 99 that the word ‘reside’ has the meaning ‘to dwell permanently or for a considerable time, to have one’s settled or usual abode, to live in a particular place’. This describes a place where someone lives or calls home. In the current proceedings, Mr Rowan’s residence or place of abode is his home in New South Wales.
- The authorities also state that a person can be ‘resident’ in more than one place. It is really a question of fact and degree. In Levene, the Court held at 223-224:
But a man may reside in more than one place. Just as a man may have two homes – one in London and the other in the country – so he may have a home abroad and a home in the United Kingdom, and in that case he is held to reside in both places and to be chargeable with tax in this country. Thus, in Cooper v Cadwalader, an American resident in New York who had taken a house in Scotland which was at any time available for his occupation, was held to be resident there, although in fact he had only occupied the house to two months during the year; and to the same effect is the case of Loewenstein v de Salis. The above cases are comparatively simple, but more difficult questions arise when the person sought to be charged has no home or establishment in any country but lives his life in hotels or at the houses of his friends. If such a man spends the whole of the year in hotels in the United Kingdom, then he is held to reside in this country; for it is not necessary for that purpose that he should continue to live in one place in this country but only that he should reside in the United Kingdom. But probably the most difficult case is that of a wanderer who, having no home in any country, spends a part only of his time in hotels in the United Kingdom and the remaining and greater part of his time in hotels abroad. In such cases the question is one of fact and degree, and must be determined on all the circumstances of the case: Reid v Inland Revenue Commissioners. If, for instance, such a man is a foreigner who has never resided in this country, there may be difficulty in holding that he is resident here. But if he is a British subject the Commissioners are entitled to take into account all the facts of the case, including facts such as those which are referred to in the final paragraph above quoted from the case stated in this instance. Further, the case may be different, and in such a case regard must be had to r. 3 of the General Rules applicable to all the Schedules of the Income Tax Act, which provides that every British subject whose ordinary residence has been in the United Kingdom shall be assessed and charged to tax notwithstanding that at the time the assessment or charge is made he may have left the United Kingdom, if he has so left the United Kingdom for the purpose only of occasional residence abroad. [Footnotes omitted].
- In Levene, the Court held at 225 that the term ‘ordinary resident’ ‘…connotes residence in a place with some degree of continuity and apart from accidental of temporary absences’.
- In Lysaght, the Court held at 248 that ‘…if residence be once established ordinarily resident means in my opinion no more than the residence is not casual but that the person held to reside do so in the ordinary course of life’.
- The English authority of Shah v Barnet London Borough Council (1983) 1 All ER 226 (“Shah”) is also instructive. In this case the Court examined the meaning of “ordinary resident of the United Kingdom”. There, the Court held at 235:
… ordinary resident refers to a man’s abode in a particular place or country which he has adopted voluntarily and for settled purposes as part of the regular order of his life or for the time being, whether of short or long duration.
- The issue of intention has been raised by Mr Rowan as an important element of the term ‘ordinary residence’. In Shah, the Court held at 236 that intention is not important provided the residence has been adopted voluntarily. The Court also held at 235 that for ordinary residence ‘…there must be a degree of settled purpose. The purpose may be one or there may be several. The purpose may be specific or general.’
- It is also clear that the test for ‘ordinary resident’ is more objective and less subjective than the concept of domicile or ‘real home’. This is stated in Shah at 236. Therefore, the test is one of looking at past events.
- Mr Rowan contends that a person can be a ‘resident’ in two or more places and cites the authority of Gregory v Deputy Federal Commissioner of Taxation (WA) (1937) 57 CLR 774 (“Gregory”). I agree that a person can be a ‘resident’ of two or more places. However, Gregory involved an interpretation of the term ‘resident’ in the context of income tax legislation and not the term ‘ordinary resident’. Therefore this authority does not assist Mr Rowan.
- Mr Rowan has also referred to Re Taylor; Ex parte Natwest Australia Bank Limited (1992) 37 FCR 194, a case which involved the interpretation of ‘ordinary residence’ in the Bankruptcy Act 1966. The Court held at 198 that:
…a person may have two places of residence; for example a city flat and country residence. He may regularly live in each. He cannot be physically present in both but he may be resident (or ordinarily resident) in each at the same time. People may come and go from the place in which they are ordinarily resident in a large variety of circumstances and on various occasions. It is always a question of fact and degree.
- Further, the presiding judge, Lockhart J, has adopted the comments on the expression ‘ordinarily resident’ as set out in the cases of Levene and Lysaght. This authority relates to the law of bankruptcy and should be viewed in that context.
- The authorities of Hafza v Director Generals of Social Security (1985) 6 FCR 444, the authority of Harding v Commissioner of Taxation (2018) FCA 837, and on appeal in Harding v Commissioner of Taxation (2019) FCAFC 29, have been raised by Mr Rowan as supporting his position that intention to return to a country is important or that a person does not necessarily cease to be a resident because he or she is physically absent. These authorities do not assist Mr Rowan. As I previously discussed, the issue of intention does not have a strong impact on whether a person ‘ordinarily resides’ in a country. Further, these authorities relate to the definitions of ‘resident’ and ‘usual place of residence’ contained in the Income Tax Assessment Act 1936 (Cth) and the Social Security Act 1947 (Cth), which are both Commonwealth Acts.
- I find that a person resides where he or she lives or dwells permanently for a considerable time. It is a person’s settled or usual abode. It is the person’s home.
- I find that the meaning of ‘ordinarily resides’:
- (a)is a term that should be given its ordinary and natural meaning;
- (b)connotes residence in a place with some degree of continuity and apart from accidental or temporary absences;
- (c)means residence that is not casual and uncertain but that the person held to reside so in the ordinary course of life;
- (d)refers to a man’s abode in a particular place or country which he has adopted voluntarily and for a settled purpose/s as part of the regular order of his life for the time being, whether short or long duration;
- (e)is a question of fact and degree, which involves a consideration of past events;
- (f)is more objective and less subjective than domicile or the concept of real home; and
- (g)does not include intention as an important factor in determining the question of ordinary residence.
- On the material before me at the Relevant Date, Mr Rowan did not ordinarily reside in Australia (section 31(1) of the LTA) and the Commissioner cannot be satisfied that Mr Rowan ordinarily resided in Australia (section 31(2) of the LTA). I am of this view because:
- (a)Mr Rowan has been away from Australia since 2010. He returned to Australia in 2015 for some 30 days. He was absent for the whole 12 months of the financial year 2016/2017 and was absent on the Relevant Date.
- (b)Mr Rowan returned to Australia on 29 November 2017.
- (c)Mr Rowan married his wife Sarah outside of Australia on 29 May 2014 and it appears there were tensions in the marriage when Mr Rowan returned to Australia in 2015. Mr Rowan returned to the USA in an attempt to save the marriage. Mr Rowan says that when he returned to the USA in 2015 he initially stayed in inns, motels and AirBnbs but moved into a condo with Sarah around Christmas 2015.
- (d)While Mr Rowan was in the USA he also travelled to Brazil, at times for up to 3 weeks, to volunteer for spiritual healing. When he was in Brazil he stayed at low cost hotels and hostels.
- (e)In 2015, Mr Rowan obtained a green card from the USA from migration authorities. Mr Rowan says this was to allow him easier access while entering the USA border.
- (f)Mr Rowan’s home was rented out except for a couple of rooms. Mr Rowan’s tenant, Ms Stickley, had access and use of these rooms on occasions. Also, at times, Ms Stickley sent documents, correspondence, emails and directed telephone calls to Mr Rowan while he was overseas.
- (g)Mr Rowan’s rental properties in Queensland were managed by real estate agents.
- (h)Mr Rowan managed his business and personal affairs from overseas.
- (i)Mr Rowan’s principle purpose in travelling to the USA in 2015 was to save his marriage and to support Sarah in complex and difficult litigation regarding her mother’s estate.
- (j)Another purpose of Mr Rowan being overseas was to assist in spiritual healing in Brazil from time to time.
- (k)Although Mr Rowan moved around while he was overseas, the regular order of his life was in the USA or Brazil. The regular order of his life was not in Australia.
- (l)Mr Rowan maintained a connection with Australia. He had family, bank accounts, a Medicare card, a home and property in Australia. He also was a ‘resident’ of Australia for income tax purposes and he always intended to return to Australia. These factors are not sufficient to displace the objective facts which point to Mr Rowan not being an ordinary resident of Australia.
- (m)Mr Rowan was staying in temporary accommodation whilst in the USA and elsewhere. Mr Rowan confirmed that at times he was staying in this accommodation and a condo with his wife. This was the case in the 2016/2017 financial year.
- (n)The exceptions set out in section 31(3) of the LTA do not apply to the applicant.
- I therefore make the following order:
The decision of the Commissioner of State Revenue made on 10 May 2018 in respect of the Objection of Peter Rowan to the land tax assessment notice dated 10 August 2017 for 2017/2018 financial year is confirmed.
- Published Case Name:
Rowan v Commissioner of State Revenue
- Shortened Case Name:
Rowan v Commissioner of State Revenue
 QCAT 151
07 Jun 2019