Boshoff v Minister for Immigration
[2006] FMCA 1919
•21 December 2006
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| BOSHOFF v MINISTER FOR IMMIGRATION & ANOR | [2006] FMCA 1919 |
| MIGRATION – Application for business skills (residence) visa – whether MRT property applied the test for “ownership” – no jurisdictional error – application dismissed. |
| Migration Act1958 (Cth) |
| SAAP v MIMIA (2005) 215 ALR 162 Videto v MIEA (1986) 69 ALR 342 MIMIA v VSAF (2005) FCAFC 73 |
| Applicant: | CHRISTIAAN JACOBUS BOSHOFF |
| Respondent: | MINISTER FOR IMMIGRATION & MULTICULTURAL AFFAIRS |
| Second Respondent: | MIGRATION REVIEW TRIBUNAL |
| File number: | BRG 87 of 2006 |
| Judgment of: | Baumann FM |
| Hearing date: | 1 August 2006 |
| Delivered at: | Brisbane |
| Delivered on: | 21 December 2006 |
REPRESENTATION
| Counsel for the Applicant: | Ms Julian-Armitage |
| Counsel for the Respondents: | Mr Brady |
| Solicitors for the Respondents: | Clayton Utz |
ORDERS
Leave is granted to join the Migration Review Tribunal as a second Respondent to the Application.
That the Application is dismissed.
That the Applicant pay a contribution to the costs of the First Respondent fixed in the sum of $5000, payable within 30 days.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT BRISBANE |
BRG 87 of 2006
| CHRISTIAAN JACOBUS BOSHOFF |
Applicant
And
| MINISTER FOR IMMIGRATION & MULTICULTURAL & INDIGENOUS AFFAIRS |
First Respondent
| MIGRATION REVIEW TRIBUNAL |
Second Respondent
REASONS FOR JUDGMENT
On 10 February 2006 CHRISTIAAN JACOBUS BOSHOFF (“the Applicant”) filed an application seeking judicial review of the decision of the Migration Review Tribunal (“the MRT”) on 5 December 2005 which affirmed the decision of a delegate of the Respondent Minister not to grant the Applicant a business skills (residence)(Class BH) visa.
As a result of the decision in SAAP v MIMIA (2005) 215 ALR 162, the MRT was joined as a second Respondent, but did not make any submissions.
The Applicant’s claim that the MRT fell into jurisdictional error is founded on the assertion set out in the application that:-
“The Tribunal failed to take into account the assets of the Applicant’s family trust when determining the total assets of the Applicant”.
Background
I adopt and incorporate as a succinct summary of the relevant history paragraphs 1 to 4 of the Applicant’s submissions as follows:-
“1. The Applicant, Christiaan Jacobus Boshoff, a South African citizen, on 21 July 1999, applied for a Business Skills (Residence) (Class BH) visa subclass 840 (Business Owner). His wife, Marlene Boshoff and children, Jana and Jacobus Boshoff were also included in that application. The Delegate refused the application on 2 May 2000 on the basis of the Applicant’s ownership interest.
2. An Application for Review of the decision to refuse was filed on 29 May 2000 in the Migration Review Tribunal (“MRT”). On 29 April 2002, the MRT remitted the decision back to the Department of Immigration and Multicultural and Indigenous Affairs (as it was then) for reconsideration with a direction that the visa applicant meets the criteria of clauses 840.212 and 840.213 for a Business Skills (Residence) (Class BH) visa Subclass 840. The criteria being that the visa applicant had 100% ownership in the business “Caravan and Boat Country and Bikes 4 All” and that his equity in the business exceeds AUD$300,000.00.
3. On 31 March 2003, the Minister’s Delegate once again refused to grant the visa on the basis that the Applicant failed to satisfy clause 840.222 in that he failed to meet the points test contained in Schedule 7 of the Migration Regulations 1994 (“the Regulations”). The visa Applicant filed a further Application for Review to the MRT on 30 April 2003.
4. On 5 December 2005 the MRT affirmed the decision of the delegate finding that the total assets in the visa applicant’s main business of a value equivalent to not less that AUD$750,000.00 in each of any 2 of the 4 fiscal year years immediately preceding the making of the application. The Tribunal refused to take the assets of the visa applicant’s family trust into consideration, thus, no points were awarded to the applicant for total assets under sub-division 1.1.3 of Schedule 7 of the Regulations.”
Preliminary Issue
The Applicant sought to rely at the hearing before me on further affidavits which I regarded as simply going to the merits of the decision and, for the reasons set out in the transcript, I agreed with the Respondent’s objection to such reliance, on the grounds of relevance.
Legislative Framework
Regulation 840.21 of the Migration Regulations under the Migration Act (Cth) 1958 set out the criteria to be satisfied at the time of the application for this visa. Regulation 840.22 sets out the criteria to be satisfied at the time of the decision.
Sub-regulation 840.222(1) required the Applicant’s score on the “business skills points test” to be not less than 105 (as specified by Gazette notice). The Applicant’s score on the test (of 100 points) was the sum of various scores under schedule 7 comprising:-
a)Division 1.1, in particular
- Subdivision 1.1.1 (annual turnover and employee level);
- Subdivision 1.1.2 (labour costs);
- Subdivision 1.1.3 (total assets).
b)Parts 2 (age of the Applicant at time of application); Part 3 (language ability); Part 4 (net assets of the applicant or the Applicant and the Applicant’s spouse).
It is common ground that the only part of schedule 7 relevant for the purpose of this application is subdivision 1.1.3 – total assets. To set the context for the discussion of the submissions which follows I set out the following relevant provisions recalling that the visa application was made on the basis of the Applicant’s ownership interest in a “main business”: Caravan & Boat Country (also known as Caravan and Boat Country/Boats 4 All).
“Main business” is defined in Regulation 1.11 relevantly as:
“(1)For the purposes of these Regulations and subject to sub-Regulation (2), a business is a main business in relation to an application for a visa if:
(a) the applicant has, or has had, an ownership interest in the business; and
(b) the applicant maintains, or has maintained, direct and continuous involvement in management of the business from day to day and in making decisions affecting the overall direction and performance of the business; and
(c) the value of the applicant’s ownership interest, or the total value of the ownership interests of the applicant and the applicant’s spouse, in the business is or was at least 10% of the total value of the business;
(d) the business is a qualifying business.
(2)If an applicant has, or has had, an ownership interest in more than 1 qualifying business that would, except for this sub-regulation, be a main business in relation to the applicant, the applicant must non nominate more than 2 of those qualifying businesses as main businesses.”
“Ownership interest” is defined in s.134(10) of the Act as:
“Ownership interest, in relation to a business, means an interest in the business as:
(a) a shareholder in a company that carries on the business; or
(b) a partner in a partnership that carries on the business; or
(c) the sole proprietor of the business;
including such an interest held indirectly through one or more interposed companies, partnerships or trusts.”
“Beneficial ownership” is defined in Regulation 1.11A, relevantly, as follows:
“(1)Subject to sub-Regulation (4), …ownership by an applicant, or the applicant’s spouse, of an asset, an eligible investment or an ownership interest, includes beneficial ownership only if the beneficial ownership is evidenced in accordance with sub-Regulation (2).
(2)To evidence beneficial ownership of an assets, eligible investment or ownership interest, the applicant must show to the Minister:
(a) a trust instrument; or
(b) a contract; or
(c)any other document capable of being used to enforce the rights of the applicant, or the applicant’s spouse, as the case requires, in relation to the asset, eligible investment or ownership interest;
stamped or registered by an appropriate authority under the law of the jurisdiction where the asset, eligible investment or ownership interest is located.
…”
“Qualifying business” is defined in Regulation 1.03 as:-
“ “Qualifying business” means an enterprise that:-
(a)is operated for the purpose of making profit through the provision of goods, services (other than the provision of rental property) to the public; and
(b) is not operated primarily or substantially for the purpose of speculation or passive investment.”
Tribunal Decision
The reasons for decision of the learned member are contained at pages 563 to 576 of the Relevant Documents (“RD”). The member carefully set out the legislative framework and recorded areas of satisfaction with various criteria under the “business skills points test”. I adopt as an accurate and clear summary of the relevant parts of the member’s reasons paragraphs 16 and 17 of the Respondent’s written submissions as follows:-
“16.The Tribunal found that the primary applicant had not established any beneficial ownership in the Jay Jay Property Trust as that term is defined in Regulation 1.11A (paragraph 47). The Tribunal accepted that the primary applicant was the registered owner of the franchises for the sale of caravans, boats and bikes and traded as a sole proprietor, but it did not accept that the trust’s assets or liabilities should be included in the calculations of the net assets of the main business. The Tribunal did not accept the audited balance sheet of the business for the reasons that the Tribunal did not accepts them as reliable statements of assets and liabilities as they included items that belonged to the Jay Jay Property Trust, in which the primary applicant did not have an ownership interest (paragraph 58). The Tribunal noted that the primary applicant had argued that since the trust was a family trust, its assets should be included with the assets of the main business which he owned. The Tribunal noted that the lawyer who declared on behalf of the applicants that the commercial properties had been transferred to the trust, noted that it was “common practice in South Africa for business to form trusts and to register income producing properties in the name of such a trust, so as to protect the assets from risks that may attach to the business”. The Tribunal found that the primary applicant did not want to retain ownership of the properties in case his business entered into financial difficulties. The Tribunal noted that it is difficult to see therefore how he could benefit now by including the trust’s assets with those of the business (paragraph 60).
17.The Tribunal found that the primary visa applicant was entitled to a total of 100 points Schedule 7. The number of points required at the time of the application and primary assessment was 105. Accordingly, the Tribunal found that the primary applicant’s score on the business skills points test is less than the number of points specified by the relevant Gazette notice. The primary visa applicant therefore did not meet the criterion in Clause 840.222 (paragraph 66). The Tribunal also considered sub-clause 845.213(2) however, in light of its findings regarding the ownership of the assets by Jay Jay Property Trust, the Tribunal found that the claimed net assets of the primary applicant (when excluding the trust assets) were insufficient (paragraph 67).”
The Jay Jay Property Trust (“the Trust”)
The Trust was established on the 23rd April 1993 by a Deed of Trust which is found at pages 459 to 478 (RD). The Applicant is not one of the beneficiaries of the Trust described at paragraph 2.1, although he is one of the “First Trustees” (paragraph 2.3). The Trust Deed sets out powers of the Trustees (paragraph 5) and importantly at paragraph 10 of the Deed makes it clear that the principal objectives of the Trust are:-
a)To preserve the Trust Fund “for the benefit of the Beneficiaries”;
b)To convey the income of the Trust Fund “to the Beneficiaries”;
c)To deliver “to the Beneficiaries at the appropriate time/s, as hereinafter specified, their portions of the Trust Fund”.
No provision in the Deed authorises the Trustees to distribute any part of the income or capital of the fund to the Applicant.
A certificate signed by the Applicant’s South African Attorney, William George Robertson, was before the MRT (Page 482 RD), and confirmed that:-
a)The Trust purchased “certain fixed property” from the Applicant during or about 1993;
b)After the Applicant had sold the fixed property to the Trust “he continued to run his business from the premises and maintained the property and serviced the mortgage with funds generated by that business”;
c)“That it is common practice in South Africa for business men to form Trusts and to register income producing properties in the name of such Trust, so as to protect the asset from risks that may attach to his business”.
Financial Statements for the Trust for the year ended 28 February 1998 begin at page 494 of the RD. Confusingly, further Financial Statements described as being for “CJ Boshoff T/A Caravan and Boat Country and Bikes 4 All (Business Only)” (see page 486 RD) incorporate as part of the fixed assets, the real property vested in the Trust.
Submissions and Discussion
The Applicant concedes that although the MRT has the power to make inquiries and that there is no duty to gather material for the Applicant, “the importance of her decision and the consequences for the visa applicant gave rise to a positive duty to make inquiries in relation to the nature of the Trust.”
It is asserted that the MRT fell into jurisdictional error “based on the differences between South African trust laws and Australian trust laws.”
The Applicant relies upon the remarks of Toohey J in Videto v MIEA (1986) 69 ALR 342 at 352, that failure to consider a relevant consideration tainted the delegates’ decision. The relevant issue in this case is said to be “in relation to the legal ambit of a foreign trust.”
Counsel for the Applicant contended that:-
“The rules of South African trust law, distinct from the Australian system of trusts, are very distinct from the Australian position”
and further that:-
“the South African Trust Property Control Act No 57 of 1988, recognises two types of trusts: one where the trustee is owner, known as the Classic Trust, and one where the beneficiary is owner”
and that
“… the Jay Jay Property Trust, was a classic trust for the purposes of South African law and as such all properties held by the Trust were properties owned by the Trustees.”
I do not accept the force of these submissions and essentially agree with the contentions of the Respondent. I find that:-
a)The Applicant did not place before the MRT any expert evidence to support the proposition that the rights of a Trustee under a Deed of Trust interpreted under the laws of South Africa were not as plainly set out in the Deed or were fundamentally different to how the Deed might be interpreted under Australian law.
b)As the Full Court in MIMIA v VSAF (2005) FCAFC 73 observed, a Tribunal (in that case the RRT), had no obligation to seek information from sources which might be available (see the authorities listed at paragraph 20).
c)
Furthermore, there was no indication or catalyst which could be identified by the Applicant which could be regarded as having reasonably put the MRT on notice (not raised by the unrepresented Applicant) that such an issue even existed.
Ms Julian-Armitage valiantly raised issues such as:
i)The use by the Applicant of the Trust property for security for business loans;
ii)The Trust was the landlord for the business;
iii)The “Main Business” paid the instalments under the mortgages received over the Trust property.
These factors merely demonstrate the support the Trust provided to the main business – nothing more, and in my view, entirely consistent with the view expressed by the MRT, it did not establish “ownership” of the Trust by the Applicant as required by the legislation.
d)It was a question of fact, entirely for the MRT, to decide whether the assets of the Trust should be included in calculations of the net assets of the main business in which the Applicant had clearly an “ownership interest”, namely “Caravan & Boat Country – Bikes 4 All”, (see answer to question 68 in visa application at page 53 RD). The learned member carefully considered the question of whether the Trust assets should be taken into account. I am satisfied that the MRT made a finding open to it; asked the right question; and applied the requirements of the law.
e)If the Trust was part of the “main business” because sub-regulations 1.11(1)(a), (b) and (c) were satisfied (which the MRT found not to be the case), the Trust did not satisfy the definition of a “qualifying business” because its primary role was the provision of rental property.
Conclusion
For the reasons given, I do not detect any jurisdictional error in the process or decision of the MRT. As a result the decision is a privative clause decision for the purposes of s.474(1) of the Act.
I am therefore bound to dismiss the Application.
Costs should follow the event in the usual way and in the sum set out in the Rules. I so order.
I certify that the preceding twenty-five (25) paragraphs are a true copy of the reasons for judgment of Baumann FM
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