PARISI v Minister for Immigration

[2005] FMCA 218

FEDERAL MAGISTRATES COURT OF AUSTRALIA

PARISI & ANOR v MINISTER FOR IMMIGRATION [2005] FMCA 218

MIGRATION – Review of Migration Review Tribunal decision – Business Entry Visa – meaning of ‘employment’ – relevant considerations in determining whether business ‘contributes to the creation or maintenance of employment’.
MIGRATION – Review of Migration Review Tribunal decision – meaning of ‘demonstrated record of or commitment towards training’ – relevant considerations.
MIGRATION – Review of Migration Review Tribunal decision – meaning of sufficient assets ‘adequate to conduct the business’ – failure to make relevant findings of fact.

Migration Act 1958 (Cth)

Shead v Minister for Immigration and Multicultural Affairs [2001] FCA 933
Nice Shoes Australia Pty Ltd v Minister for Immigration and Multicultural and Indigenous Affairs [2004] FCA 252
Chiang v Minister for Immigration and Multicultural Affairs [2001] FCA 542
Masuoka & Anor v Immigration Review Tribunal & Anor (1996) 67 FCR 49 2
Minister for Immigration and Multicultural Affairs v Wu Shan Ling (1996) 185 CLR 259

Applicants:

DOMENICO PARISI &

RAFFAELA METE

Respondent: MINISTER FOR IMMIGRATION & MULTICULTURAL & INDIGENOUS AFFAIRS

File No: MLG 338 of 2004

Delivered on: 3 March 2005

Delivered at: Melbourne

Hearing date: 6 December 2004

Last submissions due: 25 January 2005

Judgment of: Riethmuller FM

REPRESENTATION

Counsel for the Applicant: Mr Morfuni

Solicitors for the Applicant: Joseph Italiano & Associates

Counsel for the Respondent: Mr Mosley

Solicitors for the Respondent: Australian Government Solicitor

ORDERS

(1)That a writ of certiorari issue, quashing the decision of the Migration Review Tribunal made on 2 December 2003.

(2)That a writ of mandamus issue, requiring a differently constituted Migration Review Tribunal to determine the matter according to law.

(1)The respondent do pay the applicant’s costs fixed in the sum of $6,000.00.That a writ of mandamus issue, requiring a differently constituted Migration Review Tribunal to determine the matter according to law.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
MELBOURNE

MLG 338 of 2004

DOMENICO PARISI &

RAFFAELA METE

Applicants

And

MINISTER FOR IMMIGRATION &
MULTICULTURAL & INDIGENOUS AFFAIRS

Respondent

REASONS FOR JUDGMENT

1.The applicant in this matter is a national of Italy born on 24 July 1953. The applicant applied for a Temporary business Entry (Class UC) visa on 15 March 2002.  Included in the application was his wife Raffaela Mete born on 7 June 1953 (a secondary visa applicant).  The delegate of the respondent refused to grant the visa on 17 February 2003.  On
24 February 2003 the applicant lodged an application for review by the Migration Review Tribunal (‘the MRT’). The MRT heard the applicant and witnesses on his behalf on 9 October 2003 before making a decision on 2 December 2003.

2.The MRT affirmed the delegate's decision, finding that the applicant was not entitled to the grant of Temporary Business Entry (class UC) visa.  The applicant has held a variety of visas enabling him to stay and work in Australia since 23 February 1995.  He has not held a substantive visa since the expiration of his Sub-class 457 visa on
18 March 2002, as a result of the refusal of the Minister’s delegate to grant the applicant a visa, the decision the subject of this application.

3.The applicant is a director and shareholder of two companies which sell fabric in Australia: New Line Fabrics Pty Ltd and Mandarisi Australia Pty Ltd.  The applicant works with another director and shareholder in Mandarisi Australia Pty Ltd, Ms Pietrina Mandarano. Ms Mandarano gave evidence before the MRT.  The applicant also called his accountant Ms Linda Luzza-Gatto.

Relevant criteria for visa

4.It was agreed that the criteria in issue in this case is set out in subclause 457.223(7A) which provides as follows:

(a)either:

(i)   the applicant holds a Subclass 457 visa granted on the basis that the applicant met with the requirements of subclause (7) or Subdivision 457.32; or…

(b)on the day on which the application is made:

(i)   the applicant has been conducting the business in Australia as a principal for at least 15 months; or…

(c)the Minister is satisfied that:

(i)   the business is of benefit to Australia; and

(ii)    the applicant has a genuine and realistic commitment:

(A)to maintain an ownership interest in the business; and

(B)to maintain a direct and continuous involvement in the management of the business; and

(C)to make decisions that affect the overall direction and performance of the business from day to day; and

(iii) nothing adverse is known to Immigration about the applicant’s business background; and

(iv)  the applicant has net assets of:

(A)not less than AUD250,000; or

(B)a lesser amount that is adequate;

to conduct the business; and

(v)     the applicant has demonstrated that there is a need for the applicant to be temporarily resident in Australia to conduct the business.

5.The relevant criteria that are in issue are 457.223(7A)(c)(i), and (iv).

6.In order to determine whether or not a ‘business is of a benefit to Australia’ the MRT was required to have regard to the definition in regulation 457.111(2) which provides as follows:

For the purposes of this Part, a business activity is of benefit to Australia if:

(a) the conduct of the activity contributes to:

(i) the creation or maintenance of employment for Australian citizens or Australian permanent residents; or

(ii)expansion of Australian trade in goods or services; or

(iii) the improvement of Australian business links with international markets; or

(iv) competitiveness within sectors of the Australian economy; and

(b) the operator of the business:

(i) introduces to, or utilises or creates in, Australia new or improved technology or business skills; or

(ii) has a satisfactory record of, or a demonstrated commitment towards, training Australian citizens and Australian permanent residents in the business in Australia.

7.It appears from reading this definition that the applicant must satisfy one of the criteria in paragraph (a) and one of the criteria in paragraph (b). In this case the applicant argues that he satisfies criteria (a)(i) and (b)(ii).

Creation or maintenance of employment

8.As a result the MRT was required to determine whether or not the conduct of the activity contributes to the creation or maintenance of employment for Australian citizens or Australian permanent residents.

9.On this issue the MRT made the following findings:

35. In his submissions, the visa applicant claimed that he had provided valuable services to his customers and had subsequently formed a second business, Mandarisi Australia Pty Ltd, to deal with the increased demand and diversity of products to Australian retailers and manufacturers (D1, f. 15-17). However the evidence contained in the financial statements or business activity statements relating to Mandarisi Australia Pty Ltd shows that it has no employees to whom wages are paid and there are no employees for New Line Fabrics Pty Ltd. The visa applicant confirmed in his evidence that New Line Fabrics Pty Ltd has no employees.

36. The evidence before the Tribunal does not demonstrate that the business has created or maintained employment for Australian citizens or Australian permanent residents and subclause 457.111(2)(a) is not met.

10.It appears clear on the face of paragraph 35 that the MRT member approached the question of whether or not the business contributed to the creation or maintenance of employment in Australia simply from the perspective of whether or not the business employed employees on wages.

11.It was never the applicant’s case that the business created or maintained employment through employing Australian citizens or residents on wages.  The true nature of the applicants case (in summary form) is recounted at paragraph 25 of the MRT members decision in the following terms:

25. The visa applicant stated that the other shareholder in Mandarisi Australia Pty Ltd was Pietrina Mandarano but he could not remember how many shares he owned in the company. He said that the company had six employees all of whom worked on a commission basis with no salary component. He said that he is involved with company business on a day-to-day basis handling the box preparing accounts ordering stock photocopying material for staff. He stated that Pietrina Mandarano was also involved on a day-to-day basis.

12.In addition to the provision of commission work to a number of persons the applicant put his case on the basis that his business created employment indirectly through the supply of cloths to Australian outlets and therefore it was argued creating employment for Australian’s in the retail industry.

13.The extent to which the business actively involved the agents can be seen from evidence given at the MRT hearing such as:

MEMBER: What do you do?

MR PARISI: What do I do? Well first of all we need to explain what’s the (indistinct), all about it, and then they need to know (indistinct) phrase, how to sell and then that’s with everything internal. And then monthly we have a meeting, just for that to show as new product and to put it through into the market. Explaining the product is, phrases and composition of fabrics, whatever there is.

MEMBER: Do you want to add to that?

MS MANDARANO: Yes, basically what Domenic says, we do do that and also the girls come out on training parties and Domenic is quite good at coaching the girls, giving them inspiration as well so that’s all part of getting them quite excited to get out there and sell. So it’s training, product knowledge and they do come in once a month for a meeting but we find that weekly or twice a week they may need help from Domenic or myself to just go through new products that may come in in between that month. So there’s always ongoing communication and training.

14.In addition there was evidence that agents were working exclusively for the business, and a marketing plan which relied heavily upon the agents (albeit a relatively brief document) (see page 150 of the court book) and evidence that the agents received 20 percent as a commission (see court book at page 323).  In Shead v Minister for Immigration and Multicultural Affairs [2001] FCA 933 Kiefel J had cause to consider this provision. Her Honour stated:

9.The Tribunal found:

“The migration agent representing Mr Shead the sponsor submitted, that Mr Verma has implemented an innovative strategy to recruit new staff for `CLUB DP' which, he claims, has proven successful, with the appointment of six (6) new staff, which he states, "proves clearly that the employment of Mr Verma by the sponsor has contributed to the creation or maintenance of employment for Australian citizens". The migration agent submits further that, as Manager of `CLUB DP', "Mr Verma is contributing toward the creation or maintenance of employment whether one focuses directly on the business itself, or adopts a broader view, having regard to the sheer number of people employed through the business". As well the Tribunal notes that it was indicated that Mr Verma introduced new employment methods and that 2 recruitment employees worked to him. It was further indicated that Mr Shead was planning to open another club in Toowoomba and that this will lead to the employment of more people. However the Tribunal notes that Mr Shead stated that the Club business had a high turnover of staff given the nature of the business. As well the business has expanded and more people have been employed as Mr Shead now has an interest in 4 clubs. Any further expansion and employment will no doubt result from an expansion of the business similar to that which has already occurred, rather than as a direct result of the employment of Mr Verma. In other words it is not the employment of Mr Verma per se that contributed or will contribute to the creation or maintenance of employment of Australian citizens or permanent residents. Consequently the Tribunal finds on balance that the employment of Mr Verma would not contribute to the creation or maintenance of employment for Australian citizens or permanent residents as referred to in paragraph 1.20D(2)(a)(i) of the Regulations. It appears that the industry as such has on the evidence of a high turnover of staff and the increase of staff has resulted in large part from the expansion that Mr Shead referred to. His businesses have a number of managers and staff on a permanent and non-permanent basis.”

11. The ultimate finding of the Tribunal was one which, according to the words of the subsection, held that Mr Verma's employment would not contribute to the creation or maintenance of employment. The reasons given for that conclusion reflect the Tribunal's view of the construction of the subsection and its requirements. There was some debate at the hearing about what was intended to be conveyed by the Tribunal in the two or three sentences which are critical to its determination. Whilst I am conscious of not reading the reasons in such a way as to unduly emphasise particular words so as to distort the overall meaning conveyed, here the words chosen have particular meaning in context and must, I consider, be given effect to. It seems to me that the Tribunal provided two views. In the first place it appears to view the statutory requirement as one requiring a direct, and not an indirect link between the visa-holder's employment and any increase in employment. In this respect it determined that the expansion of the business was the cause. If this stood as a finding of fact which excluded Mr Verma's employment as having any effect, that would be an end to the matter. The question posed by the statute would have been answered. That does not however reflect the balance of the Tribunal's reasoning, which held that his employment had not or would not "per se" contribute to the creation or maintenance of employment; and that the increase of staff had resulted "in large part" from the expansion of the business or businesses. That is to say, in legal language, the Tribunal considered the visa-holder's employment needed to be the direct and only cause. The question which it has not posed and answered is whether the employment would contribute to the employment of others in a real or meaningful way, even if there are other factors leading to the creation or maintenance of that employment and the effect of the visa-holder's employment is indirect. [emphasis added]

15.It would be fanciful to suggest that large direct marketing companies were not providing a significant contribution to the creation and maintenance of employment of Australian citizens simply because persons working in those industries were commission agents and not employees in the sense that the term is used in industrial law.  In the context of the particular regulation the term ‘employment’ must be read as referring to engagement in income producing activity rather than as engagement in a contractual employer/employee relationship for wages or salary.  To provide any other reading to the phrase would significantly limit the breadth of the regulation for no apparent purpose. It would also provide a meaning that would be more appropriate for a section that simply read ‘employing Australian citizens…’ rather than ‘the creation or maintenance of employment for Australian citizens…’.’

16.It is also clear, however, that the provision is not to be read as meaning that any employment or economic benefit no matter how small is sufficient to fulfil the criteria.  This is because the earlier part of the regulation requires the MRT to consider whether or not the business is ‘of benefit to Australia’. Clearly businesses that provide only hypothetical or minimal economic activity may not be of benefit to Australia when other factors are considered.  The appropriate test is to set out by Kiefel J in Shead as follows:

…whether the employment would contribute to the employment of others in a real or meaningful way, even if there are other factors leading to the creation or maintenance of that employment and the effect of the visa-holder's employment is indirect

17.However, this highlights the second defect in the manner in which the MRT has approached this particular question.  Not only did the MRT fail to identify the case being put by the applicant (that the business was employing commission agents), but it also failed to properly consider the real question required under the regulations: whether or not the business would contribute to the employment of others in a real and meaningful way.

18.Rather, the MRT member applied a limited test of requiring the applicant to demonstrate simply that the business has created or maintained employment of Australian citizens in the sense of wages employees with the applicant’s company. In the circumstances the MRT has failed to consider whether or not it had any jurisdiction to reverse the delegate’s decision.

19.However, as the applicant must satisfy a number of criteria it is also necessary for the applicant to show a similar error with respect to the MRT’s decision with regard to the other two disputed criteria elements. If the applicant is unable to do so the application would be bound to fail in any event.

Satisfactory record of or a demonstrated commitment towards training

20.The MRT concluded that the applicant did not have a satisfactory record of or a demonstrated commitment towards training Australian citizens and Australian residents in the business in Australia.

21.With respect to this consideration the MRT findings are limited to the following:

38. The alternative requirement of subclause 457.111(2)(b)(ii) requires a satisfactory record of or demonstrated commitment towards training Australians. The only evidence of the training of Australians, or comment towards training Australians that has been provided is contained in the evidence of the visa applicant when he stated that the commission agents were provided with information relating to the products that they are selling. It is reasonable to expect that the commitment to training Australians would be clearly evident in the financial records or detailed training plans and recruitment policies even though they are a small company. In accordance with the Federal Court decision in Masuoka, training should be aimed at ensuring that there is not an ongoing need for the employment of non-Australians. The Tribunal finds that subclause 457.111(2)(b)(ii) is also not met.   

22.There are a number of serious difficulties with the manner in which the MRT has approached the task of considering this particular element:

a)The MRT member clearly took the view that it was a requirement that training be aimed at ensuring that there is not ‘an ongoing need for the employment of non Australians’, applying Masuoka & Anor v Immigration Review Tribunal & Anor (1996) 67 FCR 49 2, a decision of the Full Court of the Federal Court under a differently worded provision. There is no requirement in the relevant conditions applicable to this case that training be aimed at ensuring there is not an ongoing need for the employment of non Australians. The MRT therefore failed to ask it the correct question and therefore failed to exercise its jurisdiction.

b)The MRT member has stated that ‘the only evidence of the training of Australians…that has been provided is contained in the evidence of the visa applicant’. It is clear from the material set out above with respect to the commission agents that the visa applicant and the other company director gave evidence to the MRT with respect to training. In addition there is a letter from the company at page 231 of the court book referring to training and some references to training in the business plan at page 150 of the court book. This is not a case where the MRT has referred to only part of the evidence (or arguably the significant part of the evidence), but rather a case where the tribunal member has stated that the evidence referred to is ‘the only evidence’ on this topic. This is a clear indication that the MRT member has failed to take into account relevant evidence before the MRT.

c)The MRT member also stated that it is reasonable to expect the training to be evident in ‘financial records or detailed training plans or recruitment policies even though they are a small company’. It is difficult to determine whether the MRT has misconstrued the law in this regard. It is clear that informal training can be sufficient. In Nice Shoes Australia Pty Ltd v Minister for Immigration and Multicultural and Indigenous Affairs [2004] FCA 252 Branson J said:

16. The Macquarie Dictionary (Rev 3^rd ed, 2001) relevantly defines ‘satisfactory’ as meaning ‘affording satisfaction; fulfilling all demands or requirements’. The New Oxford Dictionary of English (1998) may indicate a lesser standard. It relevantly defines ‘satisfactory’ as meaning ‘fulfilling expectations or needs; acceptable, though not outstanding or perfect’. The difficulty that attends the use of the term ‘satisfactory’ to qualify the record of training to which reg 1.20D(2)(c)(ii) refers is that the Migration Regulations 1994 provide no measure or standard against which a record of training is to be assessed in determining whether it affords satisfaction or is acceptable albeit not perfect. In the circumstances the necessary measure or standard must be found by implication from reg 1.20D read as a whole. Seen in that context, in my view, a ‘satisfactory record’ of training is a record that demonstrates that the applicant provides training to Australian citizens and Australian permanent residents to a degree reasonably commensurate with the nature and extent of its business operations in Australia. To put it in ordinary language, that the applicant makes a reasonable contribution to the training of the Australian workforce having regard to the nature and extent of its business operations in Australia.

The MRT appears to have assumed that more informal forms of training were necessarily insufficient, rather than considering the nature of the training and whether it was sufficient.

d)_In an attempt to support the argument that the MRT’s findings were sufficient the Respondent relied on Chiang v Minister for Immigration and Multicultural Affairs [2001] FCA 542. In Chiang very brief findings, limited to 3 sentences (see [5]) and described by North J as ‘cryptic’ (at [7])) were sufficient. However, North J made clear (also at [7]) that the Tribunal’s treatment of the subject (in that case) followed from the way in which the case was put before the Tribunal. Here the applicant’s case was not put in a way that would justify such minimal findings. In the present case the evidence before the Tribunal was that there was ongoing training being carried out by the applicant, even if at an informal level, and that the training was essential to the commission agents capacity to perform their duties. The Tribunal erred in that it has made the assumption that training which merely pertains to products and sales could not satisfy the relevant provision. It now appears clear that the law in this area is rather more substantive.

e)The Tribunal, in rejecting the applicants claim ought to have turned it’s mind to the actual training that was occurring, not simply looked for evidence of training in the form of ‘financial records’ or ‘detailed training plans’ (although they may well be evidence of the extent of training, at least in larger companies).

23.Whilst the MRT did not have the advantage of the decisions in Nice Shoes or the more recent MM International, it would appear clear the Tribunal misconstrued the training provisions under reg 1.20D(2)(c)(ii) in that it failed to apply the appropriate test, more over it applied an irrelevant test, and failed to have regard to the relevant considerations in this case with respect to this particular visa requirement. In the circumstances of this case I find that this amounts to a jurisdictional error on the part of the MRT.

sufficientSufficient assets adequate to allow the applicant to conduct the business

24.The final disputed visa requirement is that the applicant haveapplicants have assets of $250,000.00 or sufficient assets adequate to allow the applicant to conduct the business.

1.The applicant relied upon his interest in a block of land, the title of which is held by his wife in Italy, and his interest in their two companies and furniture, claimed to have a value of $45,000.00.

1. 26.With respect to the assets of the applicant the MRT said:

   40. Subclause 457.223(7A)(c)(iv) which is the criterion in dispute requires the visa applicant to either have net assets of not less than $250,000 or if the net assets are a lesser amount, that lesser figure should be adequate to conduct the business. The Tribunal notes that the visa applicant has claimed in the letter from his migration agent dated 11 September 2003 to have net assets totalling $277,338 (T1, f. 126). However that claim is not supported by the evidence. The visa applicant has no interest in the individual assets of the two companies. His interest is as a shareholder in the net assets of the company and accordingly his interest in Mandarisi Australia Pty Ltd at 30 June 2003 is $695 debit and in New Line Fabrics Pty Ltd $17,401 credit. There is evidence in the accounts that the visa applicant has loaned to Mandarisi Australia Pty Ltd the sum of $16,572 but there is also evidence that the visa applicant has borrowed from New Line Fabrics Pty Ltd the sum of $15,801. The net equity of the visa applicant in the two companies is $17,477.

   41. The visa applicant has also claimed furniture to the value of $45,000. The Tribunal does not accept this asset as it cannot be quickly redeemed for cash nor can it be used as security for a loan. It is also not clear whether this claimed value is replacement value or is a realistic estimate of the sale price.

   42. The visa applicant has also claimed to own property in Italy to the value of the $220,000. The Tribunal notes from the evidence given by the visa applicant and also by the sale deed that the property is not owned by the visa applicant but by his wife. In addition the Tribunal has considerable doubt about the value of the property. It was allegedly sold to the visa applicant's wife for euro50,000 but 10 days later is valued at euro120,339. Even with the knowledge that the sale was between brother-in-law and sister-in-law the difference between the sale price and the valuation is so great that the Tribunal has considerable doubt about the genuine nature of the sale or the valuation. Even if the Tribunal is prepared to accept the valuation figure the visa applicant is not the owner of the property and therefore cannot claim the full valuation. At best it might be argued that he is a joint owner with his wife in which case he could claim one half of the value of the property approximately $110,000. The Tribunal finds that the visa applicant does not satisfy subclause 457.223(7A)(c)(iv)(A).

   27.The calculations of the MRT member in paragraph 40 come from the financial documents provided by the applicant.  To the extent that the applicant seeks to challenge any of the findings in that paragraph it appears clear that this is an attack on findings of fact, which is not available under judicial review.

   28.With respect to paragraph 41 it is not clear to me why the MRT would have concluded that furniture is not an asset simply because it cannot be ‘quickly redeemed for cash’ or ‘used as security for a loan’.  Indeed, I do not understand why furniture can’t be sold like any other asset or used as security. It is an item regularly taken into account by financiers in determining business’ assets. However the MRT member’s finding ultimately rests on the proposition that the MRT member was not satisfied of the true value of that property.  In a case such as this it is incumbent upon the MRT to make a determination as to the value of property claimed to be an asset, even if that formal determination is that the MRT is not satisfied that the property has any identifiable value as a result of the lack of evidence of valuation.  In this case, however, the MRT member has raised concerns with respect to the nature of the property and its usefulness as an asset for the functioning of the business, but not gone further to make any specific findings.

   29.With respect to the real property, the title of which is held by the applicant’s wife, the MRT made a number of observations but failed to make a specific finding.  It was argued by the applicant that he has an equitable interest in the property, which was not taken into account by the MRT.  Unfortunately the MRT member did not clearly determine this issue at paragraph 42, although noting the possibilities of such an interest and setting out that ‘at best it might be argued that he is a joint owner with his wife in which case he could claim one half of the value of the property for approximately $110,000.00’.

   30.Whilst (in the context of this case) the MRT did not necessarily have to make specific findings of value as to each item of property in order to conclude that the totality of the property would not exceed the $250,000.00 threshold in any event, the same was not true with respect to the second limb of the test: That is, whether or not the evidence established that the assets available to the applicant were adequate for the conduct of the business.

   31.At paragraph 43 the MRT concluded that:

   43. There was evidence from the accountant that the visa applicant did not need a large amount of capital to operate the business and the visa applicant did not need $250,000 as suggested by paragraph (A). The evidence establishes that the assets available to the visa applicant do not exceed $20,000. The Tribunal is not satisfied that this lesser amount is adequate to conduct the business. The Tribunal finds the alternate requirement of subclause 457.223(7A)(c)(iv)(B) is not met.

   32.The figure of $20,000.00 referred to in paragraph 43 cannot be readily identified from the material, other than to assume that it is a generous rounding up of the value of the companies as referred to in paragraph 40 of the decision.  Given the task that the MRT was confronted with it was necessary for it to make specific findings with respect to the property in order to determine whether or not a further sum should be added to the value of the companies.  It is argued by the respondent that the terms of paragraph 43 make it clear that the MRT has, in effect, undertaken its task and rejected as a matter of fact the proposition that the applicant has any further assets.  I have had regard to the comments in MIMIA v Wu Shan Ling (1996) 185 CLR 259 (at 272) that ‘The reasons for the decision under review are not to be construed minutely and finely with an eye keenly attuned to the perception of error.’ Bearing this in mind I am not satisfied that this, in isolation, is a reviewable error rather than an awkwardly worded finding of fact

   33.More important, however, is the fact that the MRT member has not discussed any of the other evidence that goes to the proposition of the applicant that his modest financial resources are adequate to conduct the business. The MRT’s findings in this regard are effectively a one sentence finding in the following terms: ‘The tribunal is not satisfied that this lesser amount [$20,000.00] is adequate to conduct the business’.

   34.There was evidence before the MRT that the business had been operating since 1998 (see para.33 of the Tribunal’s decision). There was also evidence that the business did not carry any significant stock, operating on a cash on delivery basis. There was evidence from the applicant’s accountant at the hearing that there were sufficient funds for the business to continue to operate adequately.  This evidence was set out in the transcript of the hearing at pages 19 to 21. The following appeared:

   MEMBER:  These two companies, Mandarisi and Nuline, are they companies that need a lot of capital, a lot of money being put into them.

   MS LUZZA-GATTO: I think that I could probably answer that bit. Being the type of trade they’re in, no they don’t, because what you are doing is basically on a sales basis, you don’t actually have to hold much other than stock on hand and even then you can sell without actually having it on hand. So the amount of capital required to run it is more than sufficient and they’ll still be able to do quite well and – sorry – we usually don’t recommend that there is too much held in the company because, you know, once you’ve put it in you’ve got to sort of think about how you’re going to get it back out so you don’t really (indistinct) you just go?

   MR ITALIANO: With too much stock you become dated.

   MS LUZZA GATTO: Yes.

   MEMBER: Are you able to buy on credit from your suppliers?

   MR PARISI: Yes we are. All of it…

   MEMBER: So what are you buying on, 60 days, 30 days?...

   MS MANDARANO. Normally it’s – sorry, OK, it’s 30 days but we receive the statements (indistinct) two weeks, so it’s about 45 days and so we’ve been quite successful in being able to do that with them

   ….

   MEMBER: So you’re not extending credit?

   MS LUZZA GATTO: You don’t have debtors is what he’s asking?

   MS MANDARANO: No

   MS LUZZA GATTO: People owe you money/

   MS MANDARANO: No, thanks God, no, thanks God.

   MEMBER: so if you’re lucky you’ve managed to sell this product before you’ve had to pay for it?

   MS MANDARANO: Yes, yes. What we (indistinct) we can do.

   MS MANDARANO: As long as the consumer agrees to it and is willing to – that’s only on credit, like we (indistinct) that’s when it’s sold.

   MS MANDARANO: Yes, yes.

   MEMBER: So do you actually deliver the goods at the time of these parties or take orders and deliver ex your warehouse later?

   MS MANDARANO: Yes, we take orders from the ladies, in the book, and then we deliver them because sometimes they want five to six weeks and deliver them in that time.

   MEMBER: And they don’t get delivery until you’ve got the money?

   MS MANDARANO: Well COD – well, it’s not all COD but you see it’s – I thinks it’s great because a lot of the customers we have out there actually pay us upfront with credit and that which is – I mean it’s a good feeling and they’re fine about it so yes, basically – and then if there’s any balance left over it’s like the money’s got to be there before we dispatch the goods to them.

   MS LUZZA-GATTO: That’s COD, the whole lot ?lot?

   MR MANDARANO: Yes

   35.In addition the MRT had a number of financial statements of the business (which appear at page 151 onwards in the court book).

   36.The absence of appropriate reasons of the MRT member to support the finding that the assets available to the applicant were not adequate to allow him to conduct the business must be seen, in the context of this case, as evidence of a failure to properly consider the nature of the case and the question that had to be determined.  In the absence of explanation it is difficult to understand how the MRT could conclude that the applicant did not have sufficient assets that were adequate to conduct the business given that the business had been conducted since 1998 (see transcript excerpt above). It appears that the MRT based its considerations on the value of the financial resources and has not addressed the real question of whether or not those resources were adequate to conduct this particular business having regard to the nature of the particular business.

   37.In the circumstances I find that the MRT has failed to properly determine whether or not it should exercise its jurisdiction in this case.  It is therefore appropriate to allow the applicant’s application by making an order for certiorari setting aside the decision of the MRT, and granting a writ of mandamus, remitting the matter for determination by a differently constituted tribunal according to law.

   I certify that the preceding thirty- seven (37) paragraphs are a true copy of the reasons for judgment of Riethmuller FM

   Associate: 

   Date: