Kraues v Migration Agents Registration Authority

Case [2018] FCA 664

FEDERAL COURT OF AUSTRALIA

Kraues v Migration Agents Registration Authority [2018] FCA 664

Appeal from: Kraues v Migration Agents Registration Authority [2016] AATA 1086
File number: NSD 82 of 2017
Judge: PERRY J
Date of judgment:

11 May 2018
Catchwords: ADMINISTRATIVE LAW – application for review of decision by Administrative Appeals Tribunal affirming cancellation of registration of migration agent by the Migration Agents Registration Authority –where miners working in Australia on temporary working visas made substantial payments to the applicant, a registered migration agent, but received no services in return – where Tribunal found applicant was not a person of integrity and had not complied with the Code of Conduct for Migration Agents – whether Authority and Tribunal had jurisdiction to investigate complaints and cancel registration - whether power to cancel under s 303, Migration Act, limited to cases where immigration assistance is given by virtue of s 316(1)(d) –where applicant conflated functions and powers under the Act - whether “retainer” agreements were not “in relation to immigration assistance” but only for the applicant to be available - whether applicant denied procedural fairness – whether no evidence of client/agent relationship between the applicant and miners – construction of “client” under the Code of Conduct - whether no evidence of receipt of monies for immigration assistance – whether Tribunal made correct or preferable decision as at the time of its decision – appeal dismissed
Legislation:

Acts Interpretation Act 1901 (Cth) s 15AA

Administrative Appeals Tribunal Act 1975 (Cth) ss 43, 44

Migration Act 1958 (Cth) ss 276, 280, 281, 290, 303, 306C, 316

Migration Agents Regulations 1998 (Cth) Sch 2

Cases cited:

Allesch v Maunz [2000] HCA 40; (2000) 203 CLR 172

Australian Broadcasting Tribunal v Bond (1990) 170 CLR 321

Codelfa Construction Pty Ltd v State Rail Authority of New South Wales (1982) 149 CLR 337

Cunliffe v The Commonwealth (1994) 182 CLR 272

Davies v Australian Securities Commission (1995) 59 FCR 221

Gill v Minister for Immigration and Border Protection [2017] FCAFC 51; (2017) 250 FCR 309

Hanna v Migration Agents Registration Authority [1999] FCA 1657; (1999) 94 FCR 358

Haritos v Commissioner of Taxation [2015] FCAFC 92; (2015) 233 FCR 315

Hartnett v Migration Agents Registration Authority [2004] FCAFC 269; (2004) 140 FCR 388

Hudson v Migration Agents Registration Authority [2004] AAT 1007

Hughes and Vale Pty Ltd v State of New South Wales (No. 2) (1955) 93 CLR 127

Issa v Migration Agents Registration Authority [2015] AATA 451; (2015) 67 AAR 6

Kostas v HIA Insurance Services Pty Ltd [2010] HCA 32; (2010) 241 CLR 390

Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24

Minister for Immigration and Ethnic Affairs v Pochi [1980] FCA 85; (1980) 31 ALR 666

O’Grady v The Northern Queensland Company Limited (1990) 169 CLR 356

PMT Partners Pty Limited (In Liquidation) v Australian National Parks and Wildlife Service (1995) 184 CLR 301

Rawson v Commissioner of Taxation [2013] FCAFC 26;

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AGLC
Kraues v Migration Agents Registration Authority [2018] FCA 664
Case
[2018] FCA 664
Decision Date

CaseChat Overview and Summary

In Kraues v Migration Agents Registration Authority, the applicant, a registered migration agent, challenged the decision of the Administrative Appeals Tribunal (AAT) to affirm the cancellation of his registration by the Migration Agents Registration Authority (MARA). The dispute arose from allegations that the applicant had accepted substantial payments from miners working in Australia on temporary working visas but provided no immigration assistance in return. The Tribunal found that the applicant was not a person of integrity and had not complied with the Code of Conduct for Migration Agents. The applicant argued that the MARA and the Tribunal lacked jurisdiction to investigate the complaints and cancel his registration, claiming that the power to cancel under s 303 of the Migration Act was limited to cases where immigration assistance was provided under s 316(1)(d). He further argued that the retainer agreements were not "in relation to immigration assistance" and that he was denied procedural fairness. The court had to determine whether the Authority and Tribunal had jurisdiction to investigate complaints and cancel registration, and whether the Tribunal made the correct or preferable decision.

The court held that the Authority and Tribunal did have jurisdiction to investigate complaints and take disciplinary action against registered migration agents. The court rejected the applicant's argument that the power to cancel was limited to cases where immigration assistance was provided, finding that the terms of s 303 and the definition of "immigration assistance" in s 276 did not support such a limitation. The court also held that the retainer agreements were indeed "in relation to immigration assistance" as they were intended to make the applicant's services available for immigration assistance. Furthermore, the court found that the Tribunal did not deny procedural fairness to the applicant and that there was sufficient evidence to support the Tribunal's findings. The Tribunal's decision to affirm the cancellation of the applicant's registration was considered correct and preferable at the time it was made.

The appeal was dismissed, and the applicant was ordered to pay the respondents' costs as agreed or taxed. The court's decision underscores the importance of registered migration agents complying with their obligations and the Code of Conduct, as well as the jurisdiction of the MARA and the AAT to investigate complaints and take appropriate disciplinary action against registered migration agents.

Orders

Orders of the court

1. The appeal on questions of law under s 44 of the Administrative Appeals Tribunal Act 1975 (Cth) from the decision of the second respondent, the Administrative Appeals Tribunal made on 23 December 2016 is dismissed.

2. The applicant is to pay the first respondents costs as agreed or taxed.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

Finally, notice of a decision made under s 303 must be given to the migration agent and must set out the reasons for the decision: s 305. The Authority is also required to make a statement about the decision available in the prescribed way under s 305A of the Act, and may inform clients of the migration agent under s 305B. Particulars of cancellation or suspension must also be kept by the Authority and are available for inspection by the public: subs 287(3). These provisions emphasise the point earlier made that the disciplinary powers are ultimately directed at protecting the public.4. BACKGROUND4.1 The complaint to the Authority The circumstances in which the complaint was made on 27 November 2012 to the Authority by Mr Karu and 14 other miners may be summarised as follows. On 23 November 2012, Corestaff notified the miners that due to “the severe downturn in the mining industry our client has advised CoreStaff your services are no longer required”, that Corestaff’s efforts to find the miners another position had been unsuccessful, and that Corestaff was therefore cancelling their nominations. As the miners’ subclass 457 visas were conditional on employment in Australia, the complainants had no basis on which to remain in Australia and were no longer eligible to apply for permanent residency. By this time, the complainants had paid, collectively, more than $200,000.00 by way of payroll deductions to Kraues Law Client Trust Account pursuant to a “Retainer Agreement” to “[make] available the services of Kraues Law to provide immigration assistance under the Regional Sponsored Migration Scheme”. Shortly after receiving Corestaff’s letter, Mr Karu and other complainants met with Mr Kraues. They advised him they were terminating their agreements with him and asked him to refund the fees they had paid. Mr Kraues declined to do so. Mr Karu then instituted the complaint to the Authority, on behalf of both himself and the other miners. The complaint to the Authority alleged: [Corestaff] had been advised by Kraues Law to start deducting money to cover our [permanent residency] Application. This was done with $825 up front and 78 weekly payments of $82.50. As we have had no communication from Kurt Kraues during our stay in Australia, we have decided to terminate our agreement with Kurt and deal with the local Agent. We have all contacted Kurt via email, text message, phone, and in person but Kurt has ignored our attempts at communication. We have met with Kurt once to organise our monies repaid but he refused to answer our direct questions. Our Sponsorship in Australia has now been terminated and we’ll be going back to PNG. The money we have paid to Kurt would help us repatriate. … The complainants attached Mr Karu’s retainer agreement with Mr Kraues, which was headed “Terms and Schedule of Fees: Migration Agent Regulations (1998)”. Under the heading “Agreement and Fee Type” the agreement was described as a “Retainer Agreement – Single Sum Fixed Fee”. On 11 December 2012, Mr Kraues sent letters to each complainant stating there appeared to be “some confusion about the nature of our agreement” and further that:The total retainer fee, although structured to be paid weekly, is fully payable by you under the agreement. Termination of this agreement by you … does not extinguish the outstanding balance. Please refer to the terms of engagement for Item 4(j)(v).

Evidence

Evidence Before The Court

The Tribunal concluded that it was satisfied that Mr Kraues was not a fit and proper person to give immigration assistance for the reasons that:105. … In his dealings with Mr Karu and others, he has failed to act in the legitimate interests of his clients. He has demonstrated an apparent disregard for the professional ethics and conduct and the regulatory framework by which registered migration agent[s] [sic] operate, and he had engaged in conduct contrary to the Code of Conduct in his dealings with the complainants in this matter and in the management of their monies. The nature and extent of his failure to comply with the Code of Conduct makes him, in my view, not a person of integrity and not a fit and proper person to give immigration assistance.5. THE APPLICATION TO ADDUCE FURTHER EVIDENCE By an application made on 10 July 2017, the applicant seeks an order “Pursuant to Federal Court Rules 2011 Part 33.29 that the report of Mr Darrel Hughes dated 4 7 2017 be admitted on the appeal…” (Mr Hughes’ report). By orders made on 26 July 2017 Mr Hughes’ report was admitted on the appeal subject to an order limiting its use in evidence to “the purpose only of proving what the applicant would or may have provided to the Tribunal if he had been afforded, on his case, a reasonable opportunity to be heard.”6. CONSIDERATION OF THE QUESTIONS OF LAW 6.1 Did the Authority and the Tribunal on review lack jurisdiction to take action against the applicant?6.1.1The applicant’s submissions The applicant’s argument that the Authority and therefore the Tribunal lacked jurisdiction relies upon the terms of subs 316(1) of the Act which provides that the functions of the Authority relevantly include: (c) to investigate complaints in relation to the provision of immigration assistance by registered migration agents; and(d) to take appropriate disciplinary action against registered migration agents or former registered migration agents …(emphasis added) The phrase “immigration assistance” is defined in s 276 of the Act relevantly to mean:(1) For the purposes of this Part, a person gives immigration assistance if the person uses, or purports to use, knowledge of, or experience in, migration procedure to assist a visa applicant or cancellation review applicant by:(a) preparing, or helping to prepare, the visa application or cancellation review application; or(b) advising the visa applicant or cancellation review applicant about the visa application or cancellation review application; or(c) preparing for proceedings before a court or review authority in relation to the visa application or cancellation review application; or(d) representing the visa applicant or cancellation review applicant in proceedings before a court or review authority in relation to the visa application or cancellation review application.(2) For the purposes of this Part, a person also gives immigration assistance if the person uses, or purports to use, knowledge of, or experience in, migration procedure to assist another person by:(a) preparing, or helping to prepare, a document indicating that the other person nominates or sponsors a visa applicant for the purposes of the regulations; or(b) advising the other person about nominating or sponsoring a visa applicant for the purposes of the regulations; or(c) representing the other person in proceedings before a court or review authority that relate to the visa for which the other person was nominating or sponsoring a visa applicant (or seeking to nominate or sponsor a visa applicant) for the purposes of the regulations.(emphasis original)

Decision

Reasons for decision

On 24 October 2014, the Authority cancelled Mr Kraues’ registration under s 303(1)(a) of the Act. The Authority was satisfied for the purpose of subs 303(1)(f) and (h) that Mr Kraues was not a person of integrity, or was otherwise not a fit and proper person to give immigration assistance, and that he had not complied with multiple clauses of the Code. In accordance with s 292 of the Act, that cancellation is in effect for a period of five years from the date of the decision.4.3 The Tribunal’s decision4.3.1The application for review The applicant applied to the Tribunal for review of the Authority’s decision on 5 November 2014. On review, the Tribunal is required to make the correct or preferable decision on the material before it and in the circumstances as they exist at the time of its decision: see Shi at [35] (Kirby J) and [98] (Hayne and Heydon JJ). In this case, as in Shi, the Tribunal was engaged in a review on the merits of the Authority’s decision to cancel Mr Kraues’ registration under s 303(1) of the Migration Act. In reviewing the Authority’s decision, s 43(1) of the AAT Act empowered the Tribunal to exercise all of the powers and discretions conferred by the Migration Act on the Authority. As such, the questions for the Tribunal were whether it was satisfied that the grounds in subparagraphs (f) or (h) of s 303(1) of the Act were established; and, if so, whether the Tribunal should exercise the powers conferred by s 303(1) to cancel or suspend Mr Kraues’ registration, or to caution him.4.3.2Mr Kraues’ case before the Tribunal At the core of Mr Kraues’ application for review was the allegation that the Authority (and by extension, also the Tribunal) lacked jurisdiction “as the scheme for registration and regulation of migration agents is restricted to the provision of immigration assistance not conduct preparatory to or in anticipation of ‘immigration assistance’, as defined.” In addition, Mr Kraues alleged that he was not aware of the retainer agreement and was “totally ignorant” of the meaning ascribed to it by the complainants, he “fairly ascribed an entirely different meaning to the retainer”, and he did not provide immigration assistance but rather was paid a retainer (Tribunal reasons at [66]). 4.3.3Evidence before the Tribunal While he made extensive submissions, Mr Kraues did not provide any written or oral evidence to the Tribunal despite being invited to do so (Tribunal reasons at [61]-[62]). The evidence led by the Authority before the Tribunal included oral evidence from: Mr Karu, the initial complainant; Mr McKenzie, Recruitment Manager for the miners’ ultimate employer; Mr Ushorof, International Recruitment Consultant for Corestaff from 2011 to September 2012; and Mr Siegel, General Manager of the Western Australian operations of Corestaff. 4.3.4The Tribunal’s finding as to jurisdiction In its reasons, the Tribunal first considered Mr Kraues’ submission that it lacked jurisdiction (Tribunal reasons at [39]). This was identified as the central issue by the applicant and, as indicated above, was apparently based upon the submission that the Authority had no power to cancel Mr Kraues’ registration because he did not provide (and was not asked to provide) immigration assistance to the miners (Tribunal reasons at [41]-[42]).

Ratio Decidendi

Legal Principle Established

Nor can the concept of a fit and proper person be divorced from the office to which the inquiry relates. As Toohey and Gaudron JJ held in Australian Broadcasting Tribunal v Bond (1990) 170 CLR 321 at 380, the expression “fit and proper person”: … takes its meaning from its context, from the activities in which the person is or will be engaged and the ends to be served by those activities. The concept of “fit and proper” cannot be entirely divorced from the conduct of the person who is or will be engaging in those activities. However, depending on the nature of the activities, the question may be whether improper conduct has occurred, whether it is likely to occur, whether it can be assumed that it will not occur, or whether the general community will have confidence that it will not occur. The list is not exhaustive but it does indicate that, in certain contexts, character (because it provides indication of likely future conduct) or reputation (because it provides indication of public perception as to likely future conduct) may be sufficient to ground a finding that a person is not fit and proper to undertake the activities in question.(See also e.g. Davies v Australian Securities and Investments Commission (1995) 59 FCR 221 at 232-233 (Hill J).)3.3 Obligations imposed on registered migration agents and powers to investigate and discipline Following registration, registered migration agents are subject to ongoing monitoring and regulation by the Authority: Shi v Migration Agents Registration Authority [2008] HCA 31; 235 CLR 286 (Shi) at [149] (Kiefel J). Registration is for a twelve month period only (subs 299(1)) and continued registration is subject to meeting annual requirements for continuing professional development (s 290A) and to maintaining professional indemnity insurance (s 292B). A registered migration agent is also under an obligation to conduct herself or himself in accordance with the prescribed Code by virtue of subs 314(2): see further at [92] below. Further, s 308 arms the Authority with compulsive powers to require a registered migration agent to make a statutory declaration in answer to questions in writing, to appear before the Authority to answer questions, and to provide the Authority with documents or records. That power is in its terms unconfined and therefore subject only to such limitations as may be implied from the subject-matter, scope and purpose of the Act: Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24 (Peko-Wallsend) at 40 (Mason J). Provision is made for disciplining registered migration agents under s 303 relevantly as follows:(1) The [Authority] may:(a) cancel the registration of a registered migration agent by removing his or her name from the register; or(b) suspend his or her registration; or(c) caution him or her;if it becomes satisfied that:…(f) the agent is not a person of integrity or is otherwise not a fit and proper person to give immigration assistance; or…(h) the agent has not complied with the Code of Conduct prescribed under section 314.