Malcov and Minister for Immigration and Multicultural and Indigenous Affairs

[2005] AATA 244

Administrative

Appeals

Tribunal

 

DECISION AND REASONS FOR DECISION [2005] AATA 244

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No  N2004/1455

GENERAL ADMINISTRATIVE DIVISION		)
Re		Simion Malcov

Applicant

And Minister for Immigration and Multicultural and Indigenous Affairs

Respondent

DECISION

Tribunal Professor GD Walker, Deputy President

Date22 March 2005

PlaceSydney

Decision An extension of time is granted.

(Sgd) Professor GD Walker  ..........................................

Deputy President  

CATCHWORDS

IMMIGRATION – business visa – cancellation of business skills visa – cancellation of family unit member visa holders – examination of whether applicant has a substantial ownership interest in an eligible business in Australia, he has utilised his skills in that business, and whether he intends to continue to hold a substantial ownership and continue to utilise his skills – examination of the effects of cancellation on the family unit –found applicant did not know of decision until shortly before he lodged his application to the tribunal, the prejudice to the respondent would not be significant, whilst it is doubtful that the applicant will succeed at a substantive hearing, he is entitled to such a hearing – held extension of time for the lodging of an application to the tribunal is granted.

Migration Act 1958 ss 134(1), 134(1)(a), (b) and (c), 134(2), 134(10)

Hunter ValleyDevelopments Pty Ltd and Others v Minister for Home Affairs and Environment (1984) 58 ALR 305

REASONS FOR DECISION

22 March 2005	Professor G D Walker, Deputy President
Summary

1.      The applicant, Simion Malcov, aged 44, a citizen of the Republic of Moldova, came to Australia in 1999 with his wife, Mariana Malcova, and daughters, Ana Malcova and Alena Malcova.  On 6 April 1999, he lodged an application for a subclass 127 business skills visa.  On 7 February 2000, a business skills visa was granted to Mr Malcov with secondary visas to his family.

2.      On 29 July 2003, the respondent cancelled Mr Malcov’s business visa on the grounds that he does not have a substantial ownership interest in an eligible business in Australia, he does not utilise his skills in participating in that business, and he does not intend to continue that business in the future.  (The delegate also cancelled the secondary visas held by Mr Malcov’s family.)  That is the decision to be reviewed by the tribunal.

Background

3.      Mr Malcov, who was born in Orhei, Republic of Moldova, on 25 October 1960 and is aged 44, and his wife, Mariana Malcova, who was born in Taraklia, Republic of Moldova, on 14 October 1960 and is aged 44, have two daughters:  Ana Malcova who was born on 17 December 1984 and is aged 20, and Alena Malcova who was born on 23 April 1991 and is aged 13.  Mrs Malcova and her daughters are listed as family members in respect of Mr Malcov’s business skills visa.

4.      On 6 April 1999, Mr Malcov applied, through his migration agent, Michael Ryvchin, of Rykono Translating Interpreting and Migration Services, of Sydney, for a subclass 127 business skills visa as the director-general of Zikos Production, a biscuit manufacturing company of which he owned 40 percent of the shares as at August 1996 (T5 p49 and T8 p211).  His responsibilities as director-general were stated to be:  (a) to co-ordinate and develop the factory’s financial turnover, (b) make directions for a production trading system, (c) increase profits from manufacturing production, (d) develop production including growth and new directions, (e) arrange shareholders’ meetings, and (f) represent the company in dealings with the republic and foreign organisations and firms (T p212).  On 7 February 2000, he was granted a business skills visa and a secondary business visa was granted to his wife covering their two daughters (who were both under 18 years at that time) (T9 p213).  The visas were valid for three years from the date of entry into Australia.  Mr Malcov entered Australia in June 2000.  The exact date does not appear from the documents before the tribunal.

5.      By email sent from the Department of Immigration, Multicultural and Indigenous Affairs (“DIMIA”), Moscow office, on 7 February 2000, Mr Malcov’s migration agent was informed that he must ensure  that his client, upon his arrival in Australia, lodged a form 922 (notification of change of address) with DIMIA in Canberra (Sup T2 p2).  By email of 11 February 2000, his migration agent “guaranteed” that his client would comply (Sup T3 p3).  That form was never received by the department.

6.      By letter from DIMIA dated 24 May 2002, Mr Malcov was asked to complete a “Survey of Business Skills Migrant – 24 Months (form 1010)”, returnable to the department by 12 July 2002 (T11 p225).  Mr Malcov did not respond to that letter. 

7. On 2 April 2003, DIMIA notified Mr Malcov of its intention to cancel his business visa under s 134 of the Migration Act 1958 (“the Act”) for failure to meet the requirements of his business skills visa, including that he did not respond to the 24-month survey concerning his business activities which he had previously acknowledged was a requirement of his visa; he had not obtained a substantial ownership interest in an eligible business in Australia; had not utilised his skills in actively participating in that business at a senior level on a day-to-day basis;  and did not intend to continue holding a substantial interest in an eligible business and using his skills in that business (T12 p226). He was invited to respond to the Department’s intention and provide evidence in support of his claim by 9 May 2003.  The letter was addressed to Mr Malcov at 44/7 Elliott Street, Surfers Paradise, QLD 4217 (T p226) and a copy sent CC: 1 Laurel Court, Sorrento, QLD 4217 (T p228).  On the same day, DIMIA also notified Mrs Malcova of its intention to cancel her business skills visa and that of her daughter Alena and inviting her to respond by 9 May 2003 (T16 p235).  That letter was also addressed to 44/7 Elliott Street, Surfers Paradise, QLD 4217 (T p226) and a copy sent CC: 1 Laurel Court, Sorrento, QLD 4217 (T16 p235).  A similar letter was also sent to Ana Malcova (T14 p232).

8.      On 29 July 2003, a delegate of the respondent decided to cancel Mr Malcov’s business skills visa on the grounds that he had failed to comply with his visa requirements by completing the 24-month business skills survey and that in the absence of that survey, the delegate was not satisfied that the applicant had obtained a substantial ownership interest in an eligible business in Australia, or that he was utilising his skills in participating at a senior level in the day-to-day running of that business and that he did not intend to continue to have a substantial ownership or participate in the day-to-day running of the business (T2 p12).  That letter was forwarded to Mr Malcov at 44/7 Elliott Street, Surfers Paradise, QLD 4217.  On the same day, the business skills visas of Mrs Malcova, Ana and Alena were also cancelled. 

9.      On 9 November 2004, the solicitor for Mr Malcov, Christopher Levingston, of Christopher Levingston & Associates, solicitors, lodged an application for a review of this decision by the tribunal (T p4).  Mr Levingston also lodged with the application a letter advising that his client had received only oral notification of the cancellation of his visa on 1 November 2004 and that neither Mr Malcov nor his wife had ever received the written decision record.  He stated that he had contacted the director of the business skills unit of DIMIA on 2 November 2004 requesting a copy of the written decision and that it would be filed with the tribunal as soon as it was received.  On 9 November 2004, the tribunal informed the applicant’s solicitor that unless the tribunal received the written decision, the application could not be accepted.  On 17 January 2005, Mr Levingston lodged an application for an extension of time for the lodging of an application for review.  DIMIA was advised of this application on 20 January 2005.  On 31 January 2005, the solicitor for the respondent, Stella Koya, of Phillips Fox solicitors, lodged a notice opposing the application on the ground that “the application for review was lodged almost 18 months after the decision to cancel his visa. The applicant has had ample opportunity within that time to lodge the application for review.  There are no special circumstances warranting an extension of time in which to apply for review”.

10.     On 18 March 2005, the matter came on for hearing of an application for extension of time.

Applicable Legislation

11. Section 134 of the Act empowers the Minister to cancel a business visa in certain circumstances. The relevant provisions in Mr Malcov’s case are as follows:

134.     Cancellation of business visas

(1) Subject to subsection (2) and to section 135, the Minister may cancel a business visa (other than an established business in Australia visa, an investment-linked visa or a family member's visa), by written notice given to its holder, if the Minister is satisfied that its holder:

(a) has not obtained a substantial ownership interest in an eligible business in Australia; or

(b) is not utilising his or her skills in actively participating at a senior level in the day-to-day management of that business; or

(c)does not intend to continue to:

(i)hold a substantial ownership interest in; and

(ii)utilise his or her skills in actively participating at a senior level in the day-to-day management of;

an eligible business in Australia.

(2)The Minister must not cancel a business visa under subsection (1) if the Minister is satisfied that its holder:

(a) has made a genuine effort to obtain a substantial ownership interest in an eligible business in Australia; and

(b) has made a genuine effort to utilise his or her skills in actively participating at a senior level in the day-to-day management of that business;and

(c) intends to continue to make such genuine efforts.

(3) Without limiting the generality of matters that the Minister may take into account in determining whether a person has made the genuine effort referred to in subsection (2), the Minister may take into account any or all of the following matters:

(a)       business proposals that the person has developed;

(b)       the existence of partners or joint venturers for the business proposals;

(c) research that the person has undertaken into the conduct of an  eligible business in Australia;

(d) the period or periods during which the person has been present in Australia;

(e) the value of assets transferred to Australia by the person for use in obtaining an interest in an eligible business;

(f) the value of ownership interest in eligible businesses in Australia that are, or have been, held by the person;

(g) business activity that is, or has been, undertaken by the person;

(h) whether the person has failed to comply with a notice under section 137;

(i)if the person no longer holds a substantial ownership interest in a particular business or no longer utilises his or her skills in actively participating at a senior level of a day-to-day management of a business:

(i) the length of time that the person held the ownership interest or participated in the management (as the case requires); and

(ii) the reasons why the person no longer holds the interest or participates in the management (as the case requires).

12. Section 134(10) of the Act includes the following definitions:

eligible business means a business that the Minister reasonably believes is resulting or will result in one or more of the following:

(a) the development of business links with the international market;

(b) the creation or maintenance of employment in Australia;

(c)the export of Australian goods or services;

(d)the production of goods or the provision of services that would otherwise be imported into Australia;

(e)       the introduction of new or improved technology to Australia;

(f)an increase in commercial activity and competitiveness within sectors of the Australian economy.

established business in Australia visa means a business visa a criterion for whose grant:

(a)       relates to the applicant having an established business in Australia; or

(b)is that the applicant is a member of the family unit of the holder of a visa a criterion for whose grant is as mentioned in paragraph (a)

…

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.

13. In the case of Mrs Malcova and her daughters, ss 134(4), (5) and (6) are relevant:

(4)       Subject to subsection (5) and to section 135, if:

(a) the Minister cancels a person's business visa under subsection (1) or (3A);and

(b) a business visa is held by another person who is or was a member of the family unit of the holder of the cancelled visa; and

(c)the other person would not have held that business visa if he or she had never been a member of the family unit of the holder of the cancelled visa;

the Minister must cancel the other person's business permit or business visa by giving written notice to that person.

(5) The Minister must not cancel the other person's business visa under subsection (4) if the cancellation of that visa would result in extreme hardship to the person.

(6) The Minister is taken not to have cancelled a person's business visa under subsection (4) if the Administrative Appeals Tribunal has set aside the decision of the Minister to cancel the business visa of the relevant person to whom paragraph (4)(a) applied.

Evidence

14.     In a statutory declaration made on 17 March 2005 (the day before the hearing), Mr Malcov stated that at all times throughout the processing of his business owner (subclass 127) visa, he was represented by a registered migration agent, Michael Ryvchin.  All correspondence relating to the application was addressed to Mr Ryvchin, who corresponded with the department by letter and email.

15.     Following the grant of his visa on 7 February 2000, he entered in Australia in about June 2000.  He has no recollection of completing a form 922 informing the department of his change of address in Australia, but he maintained contact with his agent and from time to time telephoned him to inform him of his whereabouts.  Subsequently, in September 2002, he went into business with Mr Ryvchin in a partnership to operate a restaurant called The Russian Coachman, in Bourke Street, Surry Hills.  He says that the business had an average turnover of $400,000 per year,  that it was purchased for $272,000 and was sold again on 30 March 2004 for $272,000.

16.     Mr Malcov further declares that in April 2004 he entered into negotiations for the purchase of another business, which commenced operation on 13 November 2004.  The purchase price of $80,000 included a 10 year lease over the premises. Since November 2004 Mr Malcov and his family have continuously operated the business, which is a restaurant named Giardinetto located in Stanley Street, Darlinghurst.   In November 2003, he purchased the property at 40 Wark Avenue Pagewood, New South Wales, for a total price of approximately $1,040,000 including stamp duty. 

17.     Mr Malcov did not revoke his appointment of Mr Ryvchin as his migration agent until he received oral advice on 1 November 2004 that his visa had been cancelled.  He received no correspondence from the department concerning a business skills survey, or a notice of intention to cancel the visa.  He believes that if any such correspondence had been directed to his authorised agent, Mr Ryvchin would have informed him immediately. 

18.     Having learned on 1 November 2004 when he approached the department to apply for citizenship that his visa had been cancelled, Mr Malcov immediately instructed his present solicitor, who lodged an application for review of the cancellation decision with the tribunal on 9 November 2004. 

19.     The statutory declaration does not attempt to explain what Mr Malcov was doing in the two years before he purchased “The Russian Coachman” in September 2002, nor does it give the name of the vendor from whom he and Mr Ryvchin purchased it, nor of the purchaser to whom they sold it in 2004.  Nor does he account for the fact that there was not one effective address on any of the three successive passenger cards that he completed and on which the department relied when addressing its correspondence to him. 

Submissions

20.     It was argued that the case would turn on the question of notice, though it was conceded by the applicant that the form 922 notification of address had not been lodged with the department as required. 

21.     While the notification of the grant of the visa had been sent to the applicant’s migration agent as the authorised recipient, all subsequent correspondence, including the skills survey form dated 24 March 2002, the notice of intention to cancel the visa dated 2 April 2003 and the notice of cancellation dated 29 July 2003, was all mailed to the applicant personally at addresses obtained from three successive passenger cards.  The applicant said that he received none of those communications and did not become aware that he had failed to meet his obligations, or that his visa had been cancelled, until he sought to apply for citizenship on 1 November 2004.   Thereupon he took prompt action to institute the present appeal.

22. Mr Levingston argued that where a person has been appointed as authorised recipient, as Mr Ryvchin was in this case, the Minister must send all documents to the authorised recipient, though she may also send a copy of the document to the applicant personally. Mr Malcov had never revoked the appointment of his authorised recipient, nor was it appropriate that he should, as the regulations on business visas contemplate an ongoing relationship with the department in which the migration agent could be expected to represent the applicant. The respondent’s assumption that the appointment had ceased was the cause of the problem, as the applicant would have been apprised of the correspondence if it had been sent to Mr Ryvchin. The respondent’s primary obligation was that set out in s 494D of the Migration Act, which must necessarily prevail over regulation 2.55, which on its face authorises the Minister to send documents to the last address known to her.

23. Further, he argued, there was evidence that Mr Malcov had in fact conducted a business and could satisfy the discretionary test in s 134.

24. The respondent contended that the tribunal could exercise its powers in ss 29(7) and (8) of the Administrative Appeals Tribunal Act 1975 (Cth) only if the applicant could provide reasons for the delay and demonstrate an appropriate case for an extension of time within the principles enunciated by Wilcox J in Hunter ValleyDevelopments Pty Ltd and Others v Minister for Home Affairs and Environment (1984) 58 ALR 305 at 310-311. The applicant did not dispute that those principles applied in the present case.

25.     As regards notification, the respondent submitted that she was entitled to rely on regulation 2.55 and was under no obligation to take any further steps to locate the applicant.  Once the visa had been granted, she was entitled to assume that the retainer to Mr Ryvchin was at an end.  The applicant had an obligation to keep the department informed of his whereabouts and he had failed in that obligation despite having engaged the services of a migration agent. 

26.     As regards the merits of the application, there was no indication that Mr Malcov had conducted any kind of business before September 2002 and the purchase of the second business in 2004 took place after the decision to cancel the visa. 

Consideration

27.     The first criterion laid down in Hunter Valley Developments (supra) to be applied in relation to extension of time is that the applicant should offer an acceptable explanation for the delay. Mr Malcov says that he did not receive any of the three material communications from the department and that as his appointment of Mr Ryvchin as authorised recipient had not been revoked, the department was obliged by s 494D to send the documents to Mr Ryvchin. If it had done so, he would have received notice of them. Once he did become aware that his visa had been cancelled, he took prompt action to retain a solicitor and commence the appeal.

28. The second criterion looks at the action taken by the applicant, other than by applying for review under the Act. The respondent contends that the applicant rested on his rights and that the respondent was entitled to believe that the matter had been concluded. On the other hand, the applicant’s answer under the first criterion above would, if accepted, be an answer to this criterion also.

29.     The third matter to consider is any prejudice to the respondent, and here the respondent conceded that the prejudice to it, if any, is not significant.

30.     The fourth criterion is whether any public policy considerations should be taken into account.  The respondent argued that there were, but did not elaborate on the point.

31. The fifth consideration is the merits of the substantive application. The applicant’s contention concerning the relationship between s 494D and regulation 2.55 is a novel point and one which I think is reasonably arguable. If accepted, it might also affect the validity of the visa cancellation by reason of s 134(9). The evidence concerning the businesses in which the applicant had been involved since September 2002 also raises an arguable point as to whether the applicant has in fact made a genuine effort to comply with the conditions of his visa.

32.     The final consideration to be taken into account is the question of fairness as between the applicant and other persons in a similar position.  The respondent argues that granting an extension of time in this case would be unfair to diligent applicants who meet their visa obligations.  The applicant’s arguments about notice would, however, if accepted, be sufficient to satisfy that criterion. 

33.     Although I consider that the applicant has offered an acceptable explanation for the delay and has shown a reasonably arguable case both in law and on the facts, there is no doubt, even on the facts as so far alleged, that he will have some explaining to do at the substantive hearing.  For example, he will need to give an account of his business activities, if any, before September 2002.  He may need to offer some explanation for the fact that the purchase price of The Russian Coachman in September 2002 was exactly the same as its sale price in March 2004, a circumstance that might prima facie cast some doubt on the genuineness of the transaction.  Nevertheless, for the reasons given above, I think the applicant is entitled to a substantive hearing. 

34.     If I may add a seventh criterion to those enunciated by Wilcox J, I think it is more efficient that the matter be fully argued in the tribunal at this stage rather than run the risk that refusal of an extension of time could see the matter further debated in the Federal Court and remitted to the tribunal for a substantive hearing in any event.

35.     The extension of time sought should be granted.

I certify that the 35 preceding paragraphs are a true copy of the reasons for the decision herein of Professor GD Walker, Deputy President

Signed:          (Glenda Heggen)

Associate

Date/s of Hearing  18 March 2005
Date of Decision  22 March 2005    

Solicitor for the Applicant          Mr C Levingston, Christopher Levingston & Associates

Solicitor for the Respondent     Ms S Koya, Phillips Fox