Reed and Minister for Immigration and Multicultural and Indigenous Affairs

[2004] AATA 335

Administrative

Appeals

Tribunal

 

DECISION AND REASONS FOR DECISION [2004] AATA 335

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No Q2003/586

GENERAL ADMINISTRATIVE  DIVISION		)
Re		JOHN REED

Applicant

And MINISTER FOR IMMIGRATION, MULTICULTURAL AND INDIGENOUS AFFAIRS

Respondent

DECISION

Tribunal Senior Member B J McCabe

Date31 March 2004

PlaceBrisbane

Decision The decision under review is set aside. 

.................Sgd.........................

Senior Member

CATCHWORDS

IMMIGRATION AND CITIZENSHIP – Visas – applicant held Subclass 128 Business Skills Visa - applicant failed to satisfy requirements of Migration Act 1958 - whether Minister should exercise residual discretion not to cancel visa on the facts – decision set aside

Migration Act 1958 (Cth)

Kim v Minister for Immigration Multicultural and Indigenous Affairs [2004] FCA 31

REASONS FOR DECISION

31 March 2004 Senior Member B J McCabe        

1.      John Reed and his family are from South Africa. They wish to migrate to Australia where other members of their extended family are living. John Reed, the applicant, obtained a business migration visa on 16 April 1999. His wife and children were also given visas. They had three years in which to establish themselves in this country. But events overtook them. Mrs Reed became ill and the applicant was forced to delay the move from South Africa. Mr Reed says his wife is now better, and the family is ready to migrate and start a new life here. The Minister proposes cancelling the visa. The applicant has asked the Tribunal to review that decision.

2. This case requires me to consider the operation of s 134 of the Migration Act 1958. An appeal to the Federal Court in Kim v Minister for Immigration Multicultural and Indigenous Affairs [2004] FCA 31 has raised questions about the correct approach to these cases.

3. After reviewing the facts and the relevant law, I am satisfied the Minister ought to exercise his residual discretion under s 134(1) not to cancel the visa. Mr Reed and his family ought to be permitted to enter the country and start their new life, notwithstanding the delay. I will explain my reasons below.

Material before the Tribunal

4. The Tribunal was provided with the documents required under s37 of the Administrative Appeals Tribunal Act 1975. The applicant provided copies of his correspondence with the department.  He also provided a statement from his wife, Janet Reed, psychologist bills, a brief medical report concerning his wife’s condition, and statements written by his family’s minister of religion. The respondent provided me with the criteria applied to assess applicants for the subclass of business skills visa that was granted to Mr Reed.

5.      The applicant represented himself. He remains in South Africa, so he conducted his case over the telephone. The respondent was represented by Mr Peek of the Australian Government Solicitor.

The facts

6.      There is no real dispute as to the facts. Mr Reed and his family reside in South Africa. He has been a senior executive or chief executive of a number of large corporations in that country. After discussions with his family, he decided to migrate to Australia. He thought there would be plenty of opportunities here for someone with his skills. He was also worried about political instability in South Africa. Other members of his extended family had already moved to this country.

7. Mr Reed applied for a business visa though a migration agent. The criteria for business visas require the applicant to obtain (or make genuine efforts to obtain) “a substantial ownership interest in an eligible business in Australia”. Those criteria are reflected in s134, which also refers to participating in the senior management of such a business. Mr Reed says he explained in his application that he anticipated satisfying the criteria by arranging for the allocation of shares and share options as part of his remuneration package from his employer, whoever that might be. He said his migration agent said that should be acceptable, and the respondent was apparently satisfied that Mr Reed’s application satisfied the relevant criteria. (Mr Reed says he is now aware the respondent’s attitude towards executive remuneration packages may have changed.)

8.      Events moved quickly. He was granted a Business Skills visa (subclass 128) on 16 April 1999. His wife Ingrid and daughters Hayley and Cara were also granted visas. He was under the impression when he applied for the visas that he would have at least  a year to move if he was successful. He was mistaken. He was told he had to move within three months. He said that was not convenient as his daughters were in school. He arranged to sell his home at short notice and resigned his job. He travelled to Australia on 11 July 1999, and his wife and children arrived a week later.

9.      The applicant said he planned to stay in Australia and look for a new job and establish a base while his wife returned to South Africa with his daughters to finish the school year. His plans went awry when his wife became ill. It was unclear when her illness commenced, but it soon became clear to the applicant that he needed to return to South Africa to be with her. There is evidence on the file of opinions from counsellors and medical practitioners confirming the nature and extent of her illness. I have no doubt after hearing the applicant that he felt genuinely compelled to return to his home and put off moving the family in the short term. I also accept he genuinely regarded it as only a temporary delay. I accept he planned to make a permanent move as soon as his wife was able.

10.     It soon became clear Mrs Reed was more gravely ill than her husband first thought. He decided to resume working in South Africa. He found a job working for a multinational company. He put his efforts to find a job in Australia on hold.

11.     Mrs Reed is now better. The family is ready to move. But the respondent says the applicant has not satisfied the requirements of the visa because he has not acquired a substantial interest in a business here, nor has he participated in the management of such a business. The response also says Mr Reed has not made a genuine effort to satisfy these requirements.

The requirements of the Act

12. Section 134 says the Minister may cancel a visa if certain things are not done. The Minister is not obliged to cancel the visa in those circumstances. He is obliged to consider whether he should exercise the residual discretion even if the applicant has not met the criteria in s134(1): see Kim v Minister for Immigration Multicultural and Indigenous Affairs [2004] FCA 31. The Minister may not cancel the visa if the applicant has nonetheless made a genuine but unsuccessful effort to do the things he is required to do: s134(2).

13. The applicant has not acquired a substantial ownership interest in an eligible business. He has not participated in the management of such a business either. It follows he has not satisfied the criteria in s134(1), and the Minister’s discretion is enlivened. Has he satisfied s 134(2) by engaging in a genuine attempt to do those things in circumstances where he was prevented from doing anything in a practical sense by the extenuating circumstances of his wife’s illness? I do not think he can be said to have made a genuine effort, which requires evidence of positive acts like those referred to in s 134(3). He has good reasons for his inaction, but I think that is a matter to be considered by the Minister in his exercise of the discretion under s 134(1) not to cancel the visa.

14.     A question arose in relation to the applicant’s claim that receiving shares and share options in a large company constitutes the acquisition of a substantial ownership interest within the meaning of the Act. I note the applicant says he was told his plans satisfied the requirements of the Act, and he says the respondent did not raise any objection when his application was processed. The respondent is unable to dispute the applicant’s account as the original application appears to have been lost.

15. The acquisition of shares is clearly an ownership interest (see s134(10)), but the Act requires a substantial interest. The respondent says the legislation contemplates the visa holder should own the whole or a large part of a business before he or she can be said to have satisfied the test. There is an assumption that the business in question will probably be a small business. Mr Reed was never likely to own a large percentage of the shares in a large company that employed him, but his interest might nonetheless be very valuable.

16.     In Tillmans Butcheries Pty Ltd v Australasian Meat Industry Employees Union (1979) 27 ALR 367, Deane J said (at 382) the word substantial:

“…is not only susceptible to ambiguity; it is a word calculated to conceal a lack of precision.”

17.     His Honour went on to explain (at 382) the expression could mean:

“real or of substance as distinct from ephemeral or nominal. It can also mean large, weighty or big.”

18.     In the same case, Bowen CJ opined (at 374) that the expression was “quantitatively imprecise.” I think that approach must be taken in this case. As Senior Member Allen explained in Ong and Minister for Immigration, Multicultural and Indigenous Affairs [2003] AATA 178 at paragraph 26, it was:

“a question of fact and degree having regard to the business entity involved, and not simply mathematics.”

19.     I am inclined to accept one might have a substantial ownership interest without acquiring a large percentage of the shares in the company in question. There are limits to that proposition: one could not ordinarily satisfy the requirements simply by acquiring a few shares in a large publicly listed company. But even a relatively small number of shares in a large company might represent a sizeable investment that should be taken into consideration.

20.     I am satisfied the Minister’s personnel reached that view when they were considering Mr Reed’s application for a visa. I am satisfied they were able to do so in the circumstances, although it would remain to be seen how big an ownership interest Mr Reed actually acquired.

21. Should the Minister exercise his residual discretion under s 134(1) not to cancel the visa even though the applicant has not met the criteria set out in s 134? The Act does not offer any guidance as to what should be considered, and there have been few cases. In Haman and Minister for Immigration, Multicultural and Indigenous Affairs [2002] AATA 1113, Deputy President Hotop referred to a range of matters set out in a pro forma “Notice of Intention to Cancel Business Skills Visa” as a starting point.

22.     I think the Minister should not cancel the visa in all the circumstances. The applicant is still keen to come to Australia with his family, and they are now ready to do so. His capacity to make a contribution has not diminished since his application was approved. The delays he experienced were not of his own making, but were the product of unforeseen illness. The illness has now been resolved. All this was explained to the Minister: see Kim v Minister for Immigration Multicultural and Indigenous Affairs [2004] FCA 31 at paragraph 21. I note the Minister’s officers appear to have had a change of view about whether the applicant could acquire a substantial ownership interest by acquiring shares as part of his remuneration as an executive. I do not think that should be held against the applicant now.

23.     The applicant said at the hearing that his wife and children would not resist cancellation of their visas if his application to the Tribunal was unsuccessful. Given I am satisfied the Minister should exercise his discretion not to cancel the applicant’s visa, I see no reason why the visas of his wife or children should be cancelled either.

Conclusion

24.     The decision of the respondent is set aside. The applicant’s visa, and that of his wife and children, should not be cancelled.

I certify that the 24 preceding paragraphs are a true copy of the reasons for the decision herein of Senior Member B J McCabe

Signed:         ......................................Sgd..........................................
  Associate: Thomas Ritchie

Date/s of Hearing: 2 February 2004
Date of Decision: 31 March 2004
The Applicant represented himself.           
The Respondent was represented by Mr Peek, of the Australian Government Solicitor.