Sun & Anor v Minister for Immigration & Anor

[2008] FMCA 180

FEDERAL MAGISTRATES COURT OF AUSTRALIA

SUN & ANOR v MINISTER FOR IMMIGRATION & ANOR [2008] FMCA 180

MIGRATION – Review of Migration Review Tribunal decision – refusal of a skilled independent overseas student visa – visa criteria changed between time of application and time of decision – whether Regulations changing the criteria valid considered.

Commonwealth Constitution
Federal Magistrates Court Rules 2001 (Cth)
Judiciary Act 1903 (Cth), s.78B
Migration Act 1958 (Cth), ss.3B, 31
Migration Amendment Regulation No 3 (2005)
Migration Amendment Regulation No 4 (2006)
Migration Regulations 1994 (Cth)

David Securities Pty Limited v Commonwealth Bank of Australia (1992) 175 CLR 353
Quarm v Minister for Immigration & Anor [2008] FMCA 287

First Applicant: XUN SUN

Second Applicant: JIANYUAN HUANG

First Respondent: MINISTER FOR IMMIGRATION & CITIZENSHIP

Second Respondent: MIGRATION REVIEW TRIBUNAL

File Number: SYG 3776 of 2007

Judgment of: Driver FM

Hearing date: 19 February 2008

Date of last submissions: 14 March 2008

Delivered at: Sydney

Delivered on: 19 March 2008

REPRESENTATION

Counsel for the Applicant: Mr L Karp

Solicitors for the Applicant: Christopher Levingston & Associates

Counsel for the Respondents: Mr G Kennett

Solicitors for the Respondents: Australian Government Solicitors

ORDERS

1. The application is dismissed.

2. The applicants shall pay the first respondent’s costs and disbursements of and incidental to the application in the sum of $5,000, in accordance with rule 44.15(1) and item 1(c) of part 2 of schedule 1 to the Federal Magistrates Court Rules 2001 (Cth).

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
SYDNEY

SYG 3776 of 2007

XUN SUN

First Applicant

JIANYUAN HUANG

Second Applicant

And

MINISTER FOR IMMIGRATION & CITIZENSHIP

First Respondent

MIGRATION REVIEW TRIBUNAL

Second Respondent

REASONS FOR JUDGMENT

Introduction and background

1. This case concerns a confined but important issue concerning the validity of sub clause 880.230(2) of the Migration Regulations (Cth) (“the Migration Regulations”).  In particular, the issue raised is whether the clause is invalid by reason of retrospective operation or constitutional invalidity.  This case is one of a number in the Court involving applicants who applied for an Independent Overseas Student (class DD, subclass 880) visa and who believed they qualified for the visa at the time of application.  However, at the time of decision, the principal applicant in this case ceased to qualify for the class of visa sought because, between the time of application and the time of decision, the visa criteria had been changed.  At the outset, it should be noted that the Minister’s Department took a long time to consider this application.  Mr Sun lodged his application under cover of a letter dated 28 October 2005[1].  He applied on the basis of his nominated position being a “pastry cook” (ASCO code 4512-13)[2].  He had achieved a “certificate III” in food processing (retail baking) – cake and pastry from the “City College of Professional Development”[3].  He had paid the application fee of $1,935 required by clause 1128CA(2) of Schedule 1 to the Migration Regulations[4] as it then stood.

   [1] court book (CB) 1

   [2] CB 13

   [3] CB 67-68

   [4] CB 9

2. It appears from the Tribunal decision[5] that Mr Sun’s application was received by the Minister’s Department on 31 October 2005.  However, it was not until 31 January 2007 that the Minister’s delegate made a decision on the application.  The delegate decided to refuse to grant the visas sought by reference to the then applicable criteria.  The passage of time between receipt of the application and the decision invites speculation whether the Minister’s Department was holding a class of applications to be dealt with after the criteria had been amended.  If there had been evidence of that there would have been an issue of bad faith for the Tribunal to consider.  However, there was no evidence of that either before the Tribunal or this Court.

   [5] CB 165

3. Additional background facts are contained in the applicant’s outline of submissions.  I adopt the following from those submissions with necessary amendments.

4. At the time of lodgement subclass 880 contained the following provisions, as relevant to the application[6]:

   [6] CB 124-125

   880.22Criteria to be satisfied at time of decision

   880.221If regulation 2.27B applies, the applicant provides, for the purposes of the application, the assessment of his or her skills mentioned in subregulation 2.27B (4).

   880.222The applicant has the qualifying score when assessed in relation to the visa under Subdivision B of Division 3 of Part 2 of the Act.

   Note   That Subdivision of the Act provides in sections 92 to 96 for the application of a points system, under which applicants for relevant visas are given an assessed score based on the prescribed number of points for particular attributes, which is assessed against the relevant pool mark and pass mark.  The prescribed points and the manner of their allocation are provided for in Division 2.2 (see regulation 2.26A), and Schedule 6A, of these Regulations.  Pool marks and pass marks are set from time to time by the Minister by notice in the Gazette (Act, section 96).

   880.222A…  

   880.223The applicant has vocational English.

   880.224…

   880.225The applicant satisfies public interest criteria 4001, 4002, 4003, 4004, 4005, 4009 and 4010.

   880.226…

   880.227…

   880.228…

   880.229

   880.230A relevant assessing authority has assessed the skills of the applicant as suitable for his or her nominated skilled occupation.

5. Clause 880.230 was inserted by Migration Amendment Regulation No. 3 of 2005 (“Migration Amendment Regulation No. 3 of 2005”), Schedule 2 item 38. The relevant transitional provision is in Regulation 4, as follows:

   (1)The amendments made by Schedule 2 apply in relation to an application      for a visa made on or after 1 July 2005.

6. Mr Sun had supplied a positive skills assessment (CB 58) to meet the requirements of regulation schedule 2 clause 880.221, the results of an IELTS test to demonstrate his vocational English[7] to meet clause 880.223[8]. He also supplied police clearance certificates in aid of meeting the character requirements in clause 880.225.

   [7] For the requirements of "Vocational English" see Reg 1.15B(3).

   [8] CB 101-2

7. However, by the time the delegate considered the application, clause 880.230 had been amended to read as follows:

   880.230(1)  A relevant assessing authority has assessed the skills of the applicant as suitable for his or her nominated skilled occupation, and no evidence has become available that the information given or used as part of the assessment of the applicant’s skills is false or misleading in a material    particular.

   (2)If the assessment mentioned in subclause (1) is made on the basis of a qualification obtained in Australia while the applicant was the holder of a student visa, the qualification was obtained as a result of full time study of a registered course. (emphasis added)

8. The term, "registered course" is defined in regulation 1.03 as follows:

   registered course means a course of education or training provided by an institution, body or person that is registered, under section 9 of the Education Services for Overseas Students Act 2000, to provide the course to overseas students.

9. These amendments to clause 880.230 (the insertion of sub clause (2) and the renumbering of sub clause (1)) were made by the Migration Amendment Regulations No 4 of 2006, schedule 2, part 2, item 34.  The relevant transitional provision is regulation 4 which states:

   (3)The amendments made by Part 2 of Schedule 2 apply in relation to an application for a visa:

   (a)made but not finally determined (within the meaning of subsection 5 (9) of the Migration Act 1958) before 1 July 2006; or

   (b)made on or after 1 July 2006.

10. It is conceded that the course which Mr Sun undertook, successfully, to obtain his qualification, was not registered.  The effect of the insertion of sub clause 880.230(2), operating on applications made before it was promulgated, was that Mr Sun could not obtain his visa. His fee of $1,935.00 was not refundable.

The application

1. The applicants rely upon a further amended application filed on 11 February 2008.  The ground is:

   The Tribunal asked the wrong question and took into account an irrelevant consideration.

   Particulars

   The Tribunal considered that subclause 880.230(2) of Schedule 2 of the Migration Regulations 1994 applied to the applicant’s application for a Skilled – Independent Overseas Student (Residence) (Class DD) visa in circumstances where either or both,

   (a) subclause 880.230 of Schedule 2 of the Migration Regulations 1994 or

   (b) Reg 4(3)(a) of the Migration Amendment Regulations No. 4 of 2006, (being part of the transitional provisions applying to subclause 880.230)

   are invalid.

   Further particulars

   (i) sub clause 880.230(2), as given effect by Reg 4(3)(a) is uncertain and unreasonable in that subclause 880.230(2) purports to apply from a date prior to the coming into force of subclause 880.230(1), and subclause 880.230(2) can only operate where subclause 880.230(1) is engaged.

   (ii) sub clause 880.230(2), as given effect by Reg 4(3)(a) is repugnant to Section 51(xxxi) of the constitution, in that it is as law with respect to the acquisition of property, being the fee paid by the applicant pursuant to s.46(1)(ba) of the Migration Act, other than on just terms.

   (iii) sub clause 880.230(2), as given effect by Reg 4(3)(a) is ultra vires the Migration Act, in that,

   (a) it is not supported by ss.504, 31(3) or any other provision of that Act, and

   (b) entirely disproportionate to the purpose of that Act.

2. In accordance with s.78B of the Judiciary Act 1903 (Cth) notices were issues to the Attorneys-General of the Commonwealth and the States on 5 February 2008. None of the Attorneys-General chose to intervene.

3. During the course of oral argument in this matter on 19 February 2008 I asked counsel for the applicants if they wished to consider whether the effect of the amendment of the visa criteria was to convert the visa application fee to a tax in its application to the class of visa applicants who were disqualified by reason of the amendment of the criteria.  Counsel accepted the invitation to consider the position but nothing further was received.

The evidence

1. All of the evidence before me is comprised in the court book filed on 17 January 2008.

Submissions

1. The applicants relevantly submit as follows:

   The applicant's argument is as follows;

   (a)The transitional provision governing the date of application of subparagraph 880,230(2) - Reg 4(3)(a) of the Migration Amendment Regulations No. 4 of 2006 - states very clearly that subpara (2) is to apply to visa applications made but not finally determined before 1 July 2006.

   (b)Subpara 880.230(2) depends for its effect on an assessment being made under sub (1).

   (c)But sub (1) (although not the numbering thereof) applies for a visa application made on or after 1 July 2005.

   (d)The result is that subpara (2) may apply to a visa application made before subpara (1) has come into force. This is impossible because subpara (2) can only apply when subpara (1) is engaged.

   A regulation will be liable to be declared invalid by a Court if no reasonable person could have devised it (Re Minister of Primary Industries and Energy v Austral Fisheries Pty Limited (1993) 40 FCR 381, 401, per Beaumont and Hill JJ, Lockhart J agreeing at 382-3), or if it is a, "fantastic and capricious law", in the words of Starke J in Williams v Melbourne Corporation (1933) 49 CLR 142, 150; or if it is not, "certain, reasonable and not repugnant to the general law", again in the words of Starke J in Brunswick v Stewart (1941) 65 CLR 88, 94 (cf Williams J at 99).

   In King Gee Clothing Pty Ltd v The Commonwealth (1945) 71 CLR 184, 195 Dixon J, as he then was, held that regulations, "… [stand] on the same ground as an Act of Parliament and [are] governed by the same rules of construction". His Honour eschewed the idea that 'uncertainty' was an independent requirement of delegated legislation, and held that the degree of certainty required of a power arose for the nature of the power. In that case, which involved a regulation purporting to fix prices, the fixing of a price under some regulations involved a matter which was not ascertainable. His Honour held that such elements of the relevant regulations were invalid because the regulation making power had not been properly exercised (71 CLR at 199-200)[9].

   [9] cf Cann's Pty Ltd v Commonwealth (1946) 71 CLR 210.

   The applicant submits that para 880.230(2) is not a lawful exercise of the regulation making power. It is invalid because the ambiguity of having a regulatory provision that applies before the coming into force of another provision upon which it depends cannot have been intended by parliament.

   An alternative argument, upon which the applicant relies, is that the transitional provision, Reg 4(3)(a) of the Migration Amendment Regulations No. 4 of 2006 is invalid, as striking down that regulation in itself would cure the absurdity or ambiguity without striking down the substantive provision.

   In either case the offending provisions may be severable, as either Reg 880.230(2), or the transitional provision in Reg 4(3)(a) of the Migration Amendment Regulations No. 4 of 2006, can be expunged without changing the meaning of remaining provisions or having them operate in a different way (see s 46(1)(b) Acts Interpretation Act, 1901 (Cwth)).

   In neither case however can they be read down to be within power. For to read down the provision the Court would have to in effect change the meaning of the transitional provision in Reg 4(3)(a) of  Migration Amendment Regulations No. 4 of 2006. This would be an impermissible act of judicial legislation (e.g. Pidoto v Victoria (1943) 68 CLR 87, 110).

(ii)  Constitutional Inconsistency

The Constitution of the Commonwealth of Australia provides that,

51. The Parliament shall, subject to thisConstitution, have power to make laws for the peace, order, and good government of the Commonwealth with respect to:

…

(xxxi)  the acquisition of property on just terms from any State or person for any purpose in respect of which the Parliament has power to make laws;

In Mutual Pools and Staff Pty Ltd v Commonwealth (1994) 179 CLR 155, 177, Brennan J described this provision as having a dual effect;

First, it confers power to acquire property from any State or person for any purpose for which the Parliament has power to make laws and it conditions the exercise of that power on the provision of just terms.  Second, by an implication required to make the condition of just terms effective, it abstracts the power to support a law for the compulsory acquisition of property from any other legislative power (citations omitted).

Section 51(xxxi) therefore provides the Commonwealth with a qualified power to acquire property. In the present case there is no doubt that Parliament has the power to make laws with respect to Immigration. 

It is also beyond doubt that the visa application fee of $1,935.00 paid by the applicant to the Commonwealth was and is "property" (Australian Tape Manufacturers Association v Commonwealth (1993) 177 CLR 480, 509[10]).

[10] Per Mason CJ, Brennan, Deane, Gaudron JJ. cf   Mutual Pools and Staff Pty Ltd v Commonwealth (1994) 179 CLR 155, 184 per Deane & Gaudron JJ. The contention of Dawson & Toohey JJ in Mutual Pools at 196-7 that money is not property for the purposes of s 51(xxxi) is a minority view.

Was the relevant law one, "with respect to the acquisition of property"? In Grannall v. Marrickville Margarine Pty Ltd (1955) 93 CLR 55, 77, four justices of the High Court said,

The words "with respect to" ought never be neglected in considering the extent of a legislative power conferred by s 51 or s 52. For what they require is a relevance to or connection with the subject assigned to the Commonwealth Parliament, a conception very different from those which have been employed in the exposition of s 92.

Turning to the case before the Court, visa application is only valid if "any fees payable in respect of it under the regulations have been paid;" (s 46(1)(ba) Migration Act). The payment of the fee is thus an integral part of the visa application process.

The fee payable pursuant to s 46(1)(ba) may be characterised as a payment for access to the visa determination process. If so characterised it is not a "requisition" (to use the term adopted by the Privy Council in John Cooke & Co v Commonwealth (1924) 34 CLR 269, 282). You pay your money and you take your chance, but at least you have the capacity to ascertain what your chances may be at the time that you apply.

However, as a matter of practical reality the fee in the current case changed character with the advent of sub para 880.230(2). That provision took away any chance of the applicant succeeding, and so the value of his access to the process was negated. In other words the amendment combined with the transitional provision and s 46(1)(ba), turned the payment of the fee into an ex post facto expropriation. That is, apart from any other character that they might have[11], s 46 and the regulations made under s 31(3) Migration Act giving effect to it, became laws "with respect to" the acquisition of property.

[11] A law can have several characters - Mutual Pools at 188 per Deane & Gaudron JJ.

Was the acquisition on "just terms"? In the applicant's submission it cannot have been so. The visa application fee was non refundable. In normal circumstances an applicant pays his money and receives a right to have his visa application considered. That application may be successful, or it may not. If an applicant pays his money and does not meet a criterion for the relevant visa that exists at the time of application, he cannot complain. But here the only reason that the applicant failed was because the law has changed to ensure that he could not win. The change in the law has the result of the Commonwealth receiving something, and the visa applicant receiving nothing. The terms upon which the Commonwealth has acquired the visa application fee are not, "just" in any sense of the word.

The High Court jurisprudence on s 51(xxxi) indicates that there are constitutionally valid acquisitions of property that fall outside that section. In Mutual Pools at 179 CLR 189, Deane J and Gaudron J said as follows:

Obviously, many general laws which regulate the rights and conduct of individuals may, for any number of legitimate legislative purposes, effect or authorize an "acquisition of property" within the wide meaning of those words as used in s 51(xxxi). If every such law which incidentally altered, modified or extinguished proprietary rights or interests in a way which constituted such an "acquisition of property" were invalid unless it provided a quid pro quo of just terms, the legislative powers of the Commonwealth would be reduced to an extent which could not have been intended by those who framed and adopted the Australian Constitution.

As has been said, the limitations overlap. A law which is clearly authorized under some other grant of legislative power or which necessarily involves an acquisition of property unrestricted by any requirement of just terms, such as a law imposing a penalty for unlawful conduct, may well not be susceptible of independent characterization as a law with respect to the acquisition of property. While there is no set test or formula for determining whether a particular law can or cannot properly be characterized for the purposes of 51(xxxi) as a law with respect to the acquisition of property for a purpose in respect of which the Parliament has power to make laws, it is possible to identify in general terms some categories of laws which are unlikely to bear the character of a law with respect to the acquisition of property notwithstanding the fact that an acquisition of property may be an incident of their operation or application.

Those "categories of laws" include as noted by their Honours at 189-90 and 187-88,

·    Laws which provide for the creation, extinguishment transfer or modification of rights and liabilities as an incident of enforcing a general regulation of the conduct of citizens (e.g. Nintendo Co. Ltd v Centronics Systems Pty Ltd (1994) 181 CLR CLR 134).

·    Laws authorised under express grants of legislative power which, by their nature, encompass an acquisition of property. These include imposition of a tax (e.g. Australian Tape Manufacturers v Commonwealth (1993) 176 CLR at 508-10), including provisional tax (e.g. FCT v Clyne (1958) 100 CLR 246); the forfeiture of illegally imported goods (Burton v Honan (1952) 86 CLR 169); the acquisition of enemy property in time of way (A/G (Cth) v Schmidt (1961) 105 CLR 361; and the vesting of a bankrupt's estate in the hands of a receiver or trustee (cf Schmidt at 372).

None of these apply in the present case.

However, to the above categories may be added one other - that of rights acquired under a statute where such rights are inherently susceptible to variation (Attorney General (NT) v Chaffey (2007) 81 ALJR 1388; Health Insurance Commission v Peverill (1994) 179 CLR 226; Commonwealth v WMC Resources Ltd (1998) 194 CLR 1). In these cases the property was a right, created by statute that was then reduced or adjusted by statute. It was held in each case that such statutory rights are inherently susceptible to variation.

These are not the present case. Here, the property itself was not given by statute. It was money taken in return for something of value. What was of value was then removed by regulatory amendment.

(iii) The amendment was disproportionate

At the end of my submissions filed on 8 February 2008 I indicated that further or additional submissions would be forthcoming on the issue of whether the amendments to Migration Regulations Sch. 2 clause 880.230 were, "disproportionate". That submission might better be summarised by saying that the retrospective effect of sub clause 880.230 was,

(a)  ultra vires the Migration Act, and/or

(b)  entirely disproportionate to the purpose of the enabling Act.

As relevant to the present case, the power to make Regulations is contained in two sections of the Migration Act. Section 504 is in familiar form, empowering the Governor-General to make regulations, not inconsistent with the Act,

…prescribing all matters which by this Act are required or permitted to be prescribed or which are necessary or convenient to be prescribed for carrying out or giving effect to this Act.

Section 31(3) is more specific,

31(1)     There are to be prescribed classes of visas.

…

(3) The regulations may prescribe criteria for a visa or visas of a specified class (which, without limiting the generality of this subsection, may be a class provided for by section 32, 36, 37 or 37A but not by section 33, 34, 35 or 38).

The general power to make regulations under the Migration Act is in terms very similar to those considered in Broadcasting Company of Australia Pty Ltd v Commonwealth (1935) 52 CLR 52. Section 31(3) is merely an application of the general power. In my submission there is nothing in the Migration Act which requires or permits a regulation which retrospectively changes the criteria for a visa so that a person who has applied for that visa in good faith cannot succeed. Nor is there anything in the Act which permits the Commonwealth to change regulations with the effect of expropriating a visa application fee in such circumstances.

Nor, in my submission is it necessary or convenient for the carrying out or giving effect to this Act to retrospectively require a person to have completed a registered course when clause 880.230 as it previously existed required an assessment of an applicant's skills by an independent assessing authority. It cannot, of course, be necessary or convenient for the carrying out or giving effect to the Act for the Commonwealth to accept an application fee on the basis of regulations as they exist at one point in time and to retain that fee after changing the criteria for the visa in a way that meant that the applicant cannot succeed.

If, contrary to the above submissions the Court finds that subclause 880.230(2) and Reg 4(3)(a) of the Migration Amendment Regulations No. 4 of 2006 are within the regulation making power, then I submit that the means adopted are so disproportionate in their effect on individuals that they are not a real exercise of that power (South Australia v Tanner (1989) 166 CLR 161. 167-8; Minister for Resources v Dover Fisheries (1993) 116 ALR 53.

1. The Minister relevantly submits as follows:

   In this matter no issue is taken with the Tribunal’s analysis of the facts or the applicable law.  The only argument raised against the Tribunal’s decision is that the insertion cl.880.230(2) of the Migration Regulations, upon which the Tribunal relied, was invalid.

   It is common ground that, if valid, cl.880.232(2) was fatal to the Applicant’s visa application.  That was also the conclusion of the Tribunal.[12]  Accordingly the Tribunal did not express concluded views as to whether the Applicant satisfied the other criteria for the grant of the visa.  Nor did the delegate.[13]

   [12]    RD 169-170.

   [13]    RD 126-127.

The statutory ultra vires argument

The Applicant’s first argument is that cl.880.230(2), or the transitional provision applicable to it, goes beyond the regulation-making power in the Migration Act 1958 because of its “retrospective” operation.

Two points should be made at the threshold.

(a)First, there can be no doubt at all that the amendment of visa criteria, including by insertion of a provision such as cl.880.230(2), is within the power conferred by s.31. The only issue is as to the power of the Governor-General in Council to make such an amendment applicable to the decision on an application that has already been made. Accordingly, if the Applicant’s arguments are accepted, the only possible result is that the transitional provision, purporting to make the new criterion applicable to his visa application,[14] was invalid.

[14]    i.e. reg.4(3)(b) of the Migration Amendment Regulations No.4 of 2006.

(b)Secondly, it is inaccurate to describe the amendment so applied as “retrospective”.[15]  The transitional provision did not purport to give cl.880.230(2) any effect on rights accruing or events occurring before its enactment.  The new criterion was to apply only to future decisions on applications which had not been determined.[16]

[15] Cf. Applicant’s submissions at [7].

[16]    Hu v Minister for Immigration and Citizenship [2007] FMCA 1710 at [24].

The substance of the Applicant’s contention appears to be that the transitional provision cannot be within power because it creates uncertainty or absurdity.  This is said to occur because:

(a)cl.880.230 as originally enacted (later renumbered as sub-clause (1)) had effect only in relation to a visa application made on or after 1 July 2005;

(b)cl.880.230(2) applies to “the assessment mentioned in subclause (1)”;

(c)subclause (2) purports to apply to any application made but not finally determined before 1 July 2006;

(d)the class of applications to which subclause (2) applies may include applications made before 1 July 2005 – i.e., applications to which subclause (1) does not apply.

With respect, step (d) simply does not follow.  The relationship between subclauses (1) and (2) does not cause any difficulty.

Subclause (2) is expressed to apply only if “the assessment mentioned in subclause (1)” has a particular character, and thus has no application if subclause (1) has no application.  A visa application lodged before 1 July 2005 is not affected by cl.880.230 at all.  Even if this were not the preferable construction as a matter of ordinary language, it is one that is readily available and clearly to be preferred over one that leads to absurdity.

In any event there is nothing capricious, uncertain or absurd about the application of cl.880.230 in the present case.  The Applicant’s visa application was lodged after 1 July 2005 and was therefore caught by cl.880.230 from the outset.  The asserted basis for invalidity of subclause (2) thus has no application.  If necessary, the transitional provision in relation to subclause (2) could readily be read down so as to apply only to visa applications that were caught by the clause.

The constitutional argument

The Applicant’s argument based on s.51(xxxi) does not identify with any clarity the “property” said to have been acquired. Clearly, the sum of money paid by the Applicant, by way of an application fee, was paid voluntarily and in return for a service to be performed. It was not a compulsory acquisition and thus outside the field of operation of s.51(xxxi).[17]  The suggestion that the advent of subclause (2) turned the payment of the fee into an “ex post facto expropriation”[18] appears to be no more than a different way of saying that the Applicant was deprived of some right which he had acquired by payment of the fee.

The only such right, however, was the right – enforceable by public law remedies (and thus subject to judicial discretion) – to have an application considered and determined according to the statutory criteria applicable at the time of decision.[19]  Even if that amounted to “property”, a change to the relevant criteria did not extinguish or detract from that right.  The Applicant received, in legal terms, exactly what he had paid for.

(a)There was no vested right to a particular outcome,[20] or to have an application considered against the criteria as they stood when the application was made.[21]  The power to amend the Regulations (or the Act itself) from time to time is inconsistent with any such right.  Any right to have a particular version of the statutory criteria applied was contingent upon the criteria remaining in that form at the time of decision.  In other words, it was inherently susceptible to alteration.[22]

(b)The result in the Applicant’s case may have been that his application became hopeless, but that was not something that could be known to the Minister in advance.

(c)In any event it has not been proved, and cannot be assumed, that the Applicant would have obtained the visa he sought but for the amendment.  As noted above, no relevant state of satisfaction has been recorded as to whether he satisfied the other relevant criteria.

It must be kept in mind that the grant of a visa is not in any sense a fundamental right, or something that a non-citizen is entitled to expect, other than to the extent to which the Migration Act and Regulations provide. The starting point is that the sovereign power of the Commonwealth, reflected in s.51(xix) of the Constitution, extends to permitting or denying entry to its territory on any basis, or removing a non-citizen from that territory.[23]  Even a visa (or an enforceable right to be granted one) is inherently susceptible to being extinguished or modified by later exercises of that legislative power, and such modifications therefore do not amount to “acquisitions of property”.

The insertion of reg.880.230(2) did not disturb any “property” right of the Applicant.  The principles relating to acquisitions of property under s.51(xxxi) are not engaged.

[17]    John Cooke v Commonwealth (1924) 34 CLR 269, 282. See also Smith v ANL Ltd (1999) 204 CLR 493, 500–1 [8] (Gleeson CJ), 511 [43] (Gaudron and Gummow JJ) and 535 [128] (Hayne J) and cases cited in fn 162 of that judgment.

[18] Applicant’s submissions at [23].

[19]    See Hu [2007] FMCA 1710 at [26]-[27].

[20]    In the absence of a delegate having reached the state of satisfaction, referred to in s.65(1), as to all applicable criteria: see e.g. SZLDG v Minister for Immigration and Citizenship [2008] FCA 11 at [111].

[21]    New York Central RR Co v White (1917) 243 US 188, 198, quoted by McHugh J in Health Insurance Commission v Peverill (1994) 179 CLR 226, 261.

[22]    Cf. Attorney-General (NT) v Chaffey (2007) 237 ALR 373; Minister for Primary Industries and Energy v Davey (1993) 47 FCR 151.

[23]    Robtelmes v Brenan (1906) 4 CLR 395; Djalic v Minister for Immigration and Multicultural Affairs (2004) 139 FCR 292, 305-306.

Proportionality

As is noted in the Applicant’s additional submissions, s.31(3) of the Migration Act expressly provides that the Regulations may “prescribe criteria for a visa or visas of a specified class”. That is what cl.880.230 does. This is sufficient to establish that it is within power.

As explained above, the transitional provision does not give cl.880.230(2) “retrospective” effect and it does not disturb any vested right.  To appeal to the perceived unfairness of the result in this case is simply to make a criticism of the amendment on policy grounds.  The question whether such an amendment is “necessary or convenient”,[24] for the purpose of the general regulation-making power in s.504, is answered by the existence of the specific power in s.31(3); and, in any event, the phrase “necessary or convenient” does not invite consideration by the Court of the wisdom of a regulation.[25]  Notions of proportionality[26] cannot have any relevance where a regulation does precisely that which is envisaged by the enabling Act.

The inherently tenuous position of a non-citizen in Australia, discussed above, is also relevant here. Refusal of a visa is not an infringement of any basic right recognised by Australian law. As noted above, s.51(xix) of the Constitution provides a plenary power to determine the criteria upon which non-citizens will be permitted to enter and remain in Australia. Aside from provisions establishing a handful of visa classes,[27] and an overriding ministerial power to refuse entry on character grounds,[28] the specification of the criteria for permission to enter is left to the Regulations by s.31.

[24]    Applicant’s additional submissions at [3]-[4].

[25]    See Gibson v Mitchell (1928) 41 CLR 275, 279.

[26] Applicant’s additional submissions at [5].

[27]    Sections 32, 33, 34, 35, 36, 37, 37A, 38.

[28]    Section 501.

1. On 12 March 2008 the Minister’s solicitors filed additional submissions relating to the constitutional issue. Counsel for the Minister had overlooked in oral argument s.3B of the Migration Act which, so it is submitted, would ensure reasonable compensation in the event that there had been an acquisition of property, and hence provide just terms. On that basis it is submitted that the Migration Act (and the Regulations made under the authority of the Act) would not infringe s.51(xxxi) of the Constitution. On 14 March 2008 the applicants filed additional submissions in reply asserting that s.3B is of no relevance and that the Minister’s submissions are misconceived.

Reasoning

1. It is common ground that the applicants have no rights of action for damages or to recover the application fee which was paid.  I raised with counsel during argument whether the applicants might be able to recover the fee as money paid under a mistake (namely that the application would be determined pursuant to the criteria applicable at the time of the visa application) but counsel saw no merit in that suggestion.  The issue would be whether the applicants would be able to take advantage of the principles established by the High Court in David Securities Pty Limited v Commonwealth Bank of Australia (1992) 175 CLR 353 in relation to mistake and unjust enrichment. I will say no more about it here. The applicants have lost the opportunity for favourable consideration of their visa application by reason of the amendment of the criteria between application and decision. The issue to resolve is whether they are entitled to have that opportunity restored to them because of the asserted invalidity of the amendment of the criteria.

2. It is also common ground that the Commonwealth has the power to amend visa criteria to impact upon undetermined applications for visas, after such applications have been made, at least where the relevant criteria must be satisfied at the time of decision rather than at the time of application.  It is also common ground that the Commonwealth may impose a fee as a condition precedent to the making of a valid visa application (and for the processing of such applications) provided that the fee is proportionate to the service and regardless of the outcome of such applications. 

3. Questions to resolve in this case are whether the particular amendments made between application and decision are invalid by reason of uncertainty and/or unreasonableness, whether the particular amendment was beyond the regulation making power and disproportionate to the purpose of the Act and whether the effect was to acquire without just terms the application fee paid.

4. The applicants’ first argument fails on the basis of statutory construction.  The applicant contends that regulation 4(3)(a) has the effect of applying sub clause 880.230(2) from a date prior to the introduction of sub clause 880.230(1).  Such a result would be impossible.  Sub clause 880.230(2) can have no operation before the introduction of sub clause 880.230(1) upon which it depends.  Hence, sub clause 880.230(2) can have no operation prior to 1 July 2005 when clause 880.230 was inserted by the Migration Amendment Regulation (No 3) of 2005, schedule 2, item 38.  It is clear on the plain words of sub clause 880.230(2) that it relates only to an assessment mentioned in sub clause 880.230(1).  Obviously, such an assessment under sub clause 880.230(1) could not be made before the introduction of that sub clause on 1 July 2005.  The only temporal impact of the transitional provision in regulation 4(3)(a) was to apply sub clause 880.230(2) to undetermined applications made before 1 July 2006.  The transitional provision did not need to state that the amendments had no application to visa applications made before 1 July 2005 because the amendments could have no application to such visa applications.  In my view, there is no doubt as to the application of the transitional provision in relation to sub clause 880.230(2) and no issue of invalidity based upon the strained interpretation which the applicants sought to place on it. 

5. I note that Smith FM reached a similar conclusion in Quarm v Minister for Immigration & Anor[29].  I agree, with respect, with His Honour’s reasoning.

   [29] [2008] FMCA 287 at [31]-[36]

6. I also reject the constitutional argument.  First, there was no acquisition of property because the application fee was paid voluntarily.  The first applicant paid the application fee voluntarily in order to ensure that his visa application was accepted as valid and in order to secure the processing of it.  He got what he paid for.  The fee is non refundable, provided that the service to which it relates is provided.  The service was provided.  The applicants (and hopefully the Minister and his Department) were not to know at the time of the visa application that the applicants would be unable to qualify at the time of decision because of changed criteria.  That is a risk that applicants accept when they make a visa application.  There can be no guarantee at the time of application that the outcome of the application will be a successful one.  Circumstances may change rendering applicants ineligible for the class of visa they seek.  Those circumstances may be personal to the applicants.  They may be something over which the applicants have no control.  Although the amendment of the visa criteria prior to the decision on the visa application disappointed the applicants’ hopes, the changed criteria did not alter the character of the fee voluntarily paid.

7. In Quarm at [46] Smith FM found that there was no “acquisition” of the fee for the purposes of s.51(xxxi) of the Constitution. I agree with His Honour’s reasoning.

8. Secondly, I do not understand how clause 880.230 or regulation 4(3)(a) could be characterised as laws relating to the acquisition of property when they are entirely silent on the subject of the fee and have no necessary impact on the fee voluntarily paid. 

1. The applicants’ final argument is that the amendment was “disproportionate”. Section 31(3) of the Migration Act specifically empowers the executive government to make regulations to prescribe visa criteria. There is no issue of retrospectivity in the amendment of the visa criteria where the criteria fall to be assessed at a time after the amendment. As noted earlier, an issue as to the validity of a decision would arise if a decision on an application had been intentionally delayed until criteria were changed in order to disqualify the applicants. That would be an issue of bad faith, but it would not be an issue bearing on the validity of Regulations amending the criteria. I find that sub clause 880.230(2) and regulation 4(3)(a) of the Migration Amendment Regulations (No 4) 2006 (“Migration Amendment Regulations (No 4) 2006”) were validly made within the regulation making power conferred by the Migration Act. It is unnecessary to consider the Minister’s additional submissions concerning the operation of s.3B of the Migration Act.

2. I also reject the applicants’ contention that the means adopted by the amendments are so disproportionate on their effect on individuals that they are not a real exercise of that power.  It is unfortunate that the effect of the amendment to the criteria was to disqualify the applicants, but that is no more than to say that an applicant may be unable to meet criteria applicable at the time of a decision either because circumstances change or because the criteria themselves change.  It is unfortunate that the visa applications were not determined more quickly.  If an earlier decision had been made, the applicants might well have qualified for the class of visa they sought.  The unfortunate circumstances that the applicants found themselves in following the amendment of the visa criteria were recognised by the Minister’s Department in its letter to the applicants dated 22 August 2006[30].  The applicants were given the opportunity to withdraw their visa application.  They did not take up that opportunity. It was their decision to pursue to conclusion a visa application which had become hopeless. The application of the amending regulations was not disproportionate to the power conferred by the Act to make the Regulations.

   [30] CB 118-120

3. Smith FM dealt with the applicant’s argument in more detail in Quarm at [48]-[58] and rejected it. Once again, I agree with His Honour’s reasoning.

4. The Minister’s Department may wish to consider whether the applicants should be refunded the application fee paid on an act of grace basis.  Once the visa criteria were changed, it was obvious that the applicants could not qualify for the class of visa they sought.  They were taken by surprise by the changed visa criteria and may well have not applied for that class of visa if they had known that the criteria were going to change in the manner they did.  In the circumstances, the service provided by the processing of the visa applications had little value to the applicants[31] and a refund of the fee might be considered appropriate.  That is a matter beyond the scope of this proceeding.

   [31] other than to provide the opportunity for administrative and judicial review

5. I will order that the application be dismissed.  Costs should follow the event.  I see no reason to depart from the Court scale applicable in migration proceedings. 

I certify that the preceding thirty (30) paragraphs are a true copy of the reasons for judgment of Driver FM

Associate: 

Date:  19 March 2008