Tide Sequence Industries v Minister for Immigration
[2005] FMCA 49
•12 January 2005
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| TIDE SEQUENCE INDUSTRIES & ANOR v MINISTER FOR IMMIGRATION | [2005] FMCA 49 |
| MIGRATION – MRT decision – refusal to approve standard business sponsor for Temporary Business Entry (Class UC) visa – failure to be satisfied that sponsor would comply with undertakings – no error by Tribunal when considering ability to comply with Australian levels of remuneration. |
Migration Act1958 (Cth), s.483A
Judiciary Act 1903 (Cth), s.39B
Craig v South Australia (1995) 184 CLR 163
Lace Holdings Pty Ltd v Minister for Immigration and Multicultural Affairs (2002) 117 FCR 79
Minister for Immigration and Multicultural Affairs v Yusuf (2001) 206 CLR 323
MM International (Australia) Pty Ltd v Minister for Immigration & Multicultural & Indigenous Affairs [2004] FCAFC 323
| Applicants: | TIDE SEQUENCE INDUSTRIES PTY LTD & MENG QIN ZHU |
| Respondent: | MINISTER FOR IMMIGRATION & MULTICULTURAL & INDIGENOUS AFFAIRS |
| File Nos: | SZ1477 of 2004 SZ2088 of 2004 |
| Delivered on: | 12 January 2005 |
| Delivered at: | Sydney |
| Hearing date: | 8 December 2004 |
| Judgment of: | Smith FM |
REPRESENTATION
| Counsel for the Applicants: | Mr J Overall |
| Solicitors for the Applicants: | Ren Zhou Lawyers |
| Counsel for the Respondent: | Mr R Beech-Jones |
| Solicitors for the Respondent: | Clayton Utz |
ORDERS
In each matter, the application is dismissed.
In each matter, the applicant is to pay the respondent’s costs.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT SYDNEY |
SZ1477 of 2004 & SZ2088 of 2004
| TIDE SEQUENCE INDUSTRIES PTY LTD & ANOR |
Applicants
And
| MINISTER FOR IMMIGRATION & MULTICULTURAL & INDIGENOUS AFFAIRS |
Respondent
REASONS FOR JUDGMENT
Before the Court are two applications under s.483A of the Migration Act 1958 (Cth). In matter SZ1477 of 2004, Tide Sequence Industries Pty Ltd (“Tide Sequence”) seeks orders by way of judicial review under s.39B of the Judiciary Act 1903 (Cth) of a decision of the Migration Review Tribunal given on 28 April 2004. The Tribunal affirmed a delegate’s decision refusing Tide Sequence’s application for approval as a business sponsor in relation to its employment of Mrs Meng Qin Zhu and for the purposes of an application by Mrs Zhu and her children for Temporary Business Entry (Class UC) visas.
In matter SZ2088 of 2004, Mrs Zhu seeks similar orders in relation to a decision of the Tribunal given on 16 June 2004, which affirmed a delegate’s decision refusing her visa application. The refusal, and its affirmation, followed inevitably upon the refusal of the business sponsorship application, since sponsor approval was a necessary criterion for the visa under subclause 457.223(4) of Schedule 2 to the Migration Regulations 1994 at the relevant time. It is not necessary to for me to explain or explore Mrs Zhu’s case further, since it is conceded by her counsel that her application is dependent upon success in the Tide Sequence application. Conversely, the Minister’s counsel conceded that if the Tribunal’s Tide Sequence decision should be set aside, then so too should be its decision in relation to Mrs Zhu. In these circumstances, and since Mrs Zhu was represented by the same lawyers as Tide Sequence, I accepted the request of counsel for all parties that the two matters should be heard together. These reasons therefore explain my orders made in both matters.
The background to the matter is sufficiently described by the Tribunal in its decision concerning Mrs Zhu:
8 The primary visa applicant first entered Australia on a Business (Short stay) visa on 16 November 1996. A further Business (Short stay) visa was granted on 2 July 1997, and the primary visa applicant travelled a number of times until the visa’s expiry on 16 August 1998. The primary visa applicant was in Australia when a Business (Long stay) visa was granted on 6 January 1999. Her spouse and child were also granted Business (Long stay) visas, with the spouse arriving in Australia on 21 April 1999 and the son on 18 June 2000. The visa applicants’ visas expired on 6 January 2003 and since then the visa applicants have held bridging visas granted on the basis of applications for visas the subject of this review (T1, ff. 18-25).
9.The visa applications were made on the basis that the primary visa application would be employed by Tide Sequence Industries Pty Ltd as a Director and Trade Manager. The delegate stated that the visas were not granted on the basis that the proposed employer had not been approved as a business sponsor (D1, F. 70). The visa applicants stated when lodging the application for review that the primary visa applicant is still employed by the sponsoring business, who is “still active in the manufacturing of ladies clothing” and that she plans and conducts training for sub-contractors (T1, f. 9).
The primary criterion sought to be satisfied by Mrs Zhu included cl.457.221(4)(a), (b) and (c) of Sch 2, which required that “the activity in which the applicant proposes to be employed in Australia by a person (the employer) is the subject of an approved business nomination by the employer”, that “the employer is … a standard business sponsor approved under regulation 1.20D…”, and that “the applicant is nominated … in relation to the activity by the employer”. It was the absence of approval of Mrs Zhu’s employer as a “standard business sponsor” which was fatal to her application.
A further visa criterion in cl.457.221(4)(f) required that, where the sponsor nominated “an activity in which (the) individual is proposed to be employed” under reg 1.20G, the Minister should be satisfied that the visa applicant “will be paid at the level specified in the nomination” and “that level will be at least the minimum salary level that applied at the time the nomination was made”. The “minimum salary level” applicable in the present case was specified in Gazette Notice SGN 406 of 30 October 2002 as “a gross annual salary of AUD 35,828” (the Notice was made under regs 1.20B and 1.20G(4)).
In the present case, the reasoning of the decision-makers did not need to address the visa criterion requiring a salary to be paid above a legislated level, but its presence may explain why the applicants presented their visa and sponsorship applications so as to show Mrs Zhu receiving a very significant increase from her former salary of $18,200. In each application, it was indicated that Mrs Zhu would fill a position as “trade manager” ASCO Code 160101 1299-79 at “annual salary (gross) A$45,000”.
Under reg 1.20C an application by the employer for approval as “a standard business sponsor” “must be made in accordance with approved form 1067”. Regulation 1.20B then listed a series of conditions to be satisfied. These were explored by the delegate and Tribunal, but it is necessary for me only to set out the one upon which the Tribunal reached a conclusion adverse to Tide Sequence. It provided:
(2) The Minister must approve an application for approval as … a standard business sponsor … if:
…
(f) The Minister is satisfied that while there is in effect a Subclass 457 visa granted on the basis that:
(i) the applicant for approval is the employer referred to in subclause 457.223(4) of Schedule 2 in relation to a visa application; and
(ii) the visa holder satisfies the requirements of that subclause;
the applicant for approval is able, in relation to each visa holder, to comply with the undertakings given by the applicant in accordance with form 1067.
The version of Form 1067 signed by Tide Sequence contained the following undertakings:
·Accept responsibility for obligations to the Commonwealth for sponsored persons. For example,
-ensure that the tax instalments are deducted from salary or wages and eligible termination payments, Fringe Benefits Tax
-make superannuation contributions
-pay debts owed to the Commonwealth as a result of sponsored person and/or dependants receiving or using Commonwealth benefits or services to which they have no entitlement eg. Medicare, social security benefits
·comply with Australian industrial relations laws, Australian levels of remuneration, and conditions of employment
·accept financial responsibility directly or through acceptable medical insurance arrangements, for all medical and hospital costs incurred in Australia by sponsored persons and their dependants
·…
·be responsible for repatriation costs for sponsored persons and their dependants
·…
The Tribunal’s reasoning in relation to this condition was:
Is the applicant for approval able to comply with undertakings in respect to visa holders?
24.At the time of application, the review applicant provided copies of the 2000 and 2002 Company tax returns, with associated profit and loss statements and balance sheets included. It is noted by the Tribunal that there is no information in relation as to who prepared the financial statements submitted. For the year ended 20 June 2000, expenditure on wages was $60 016 and sub-contractors was $233 976. For the year ended 20 June 2002, expenditure on wages was $74 100 and sub-contractors was $208 930. In a later submission the review applicant advised the Department that the variation in wages expenditure was “attributed to increase of Directors salary and staff wage”. It is noted by the Tribunal that the review applicant submitted PAYG Payment summaries for the visa applicant, which indicate wages for the visa applicant of $18 000 for 1999 and 2000, and $18 200 for 2001 and 2002. This raises considerable doubt as to whether the review applicant is complying with both Australian remuneration levels and its undertakings in relation to the visa applicant. The Tribunal may wish to request further information as to the visa applicant’s position and working hours to determine the suitability of this salary level.
25.The profit and loss statements list a net profit of $379.36 for 2003, $399.50 for 2002 and $7 001 for 2000, and the balance sheet shows net assets of $46 580 for 2003, $48 562 for 2002 and $102 423.87 for 2000. This reveals that both the profitability and the potential liquidity of the review applicant have reduced substantially. Furthermore the review applicant listed in the nomination form that the annual gross salary for the visa applicant would be $45 000, representing an increase of $26 800. The visa applicant’s spouse and son are also included in the application. It is further noted that the profit and loss statements do not include a line entry for superannuation. Despite this the review applicant produced evidence of this to the Tribunal at the hearing. (T1, ff. 144-145). However, the commencement date was 16 March 2004. From the profit and loss statement of the review applicant it does not appear that the review applicant could afford to pay the visa applicant the appropriate salary. The review applicant has suggested that if the visa applicant were to be employed by the review applicant firm the profits and ability to meet the undertakings would be guaranteed.
26.The Tribunal has received additional information including financial statements to the end of June 2003 (T1, ff. 83-91). Financial statements for June 2002 are on the Department file. These indicate a tiny profit made in the last two years (an assertion made by the Tribunal in hearing with which the review applicant spokesperson concurred). Furthermore, the net assets figure though positive would not allow the review applicant to meet the undertakings provision in Regulation 1.20D(2)(f).
CONCLUSION
27.The Tribunal finds that the review applicant does not meet the criteria for approval as a business sponsor – specifically paragraph 1.20D(2)(f). The Tribunal must, therefore, affirm the decision under review.
In the amended application in this Court, the applicant raised two grounds for obtaining the quashing of the Tribunal’s decision. I shall set them out and address them separately.
Ground 1
The MRT committed jurisdictional errors of law in ignoring relevant material or failing to take into account relevant considerations, being (a) the actual Australian Industrial Laws, levels of remuneration and conditions of employment governing the employment obligations of Mrs Zhu as at the date of the application.
Counsel for the applicant submitted that the Tribunal had “ignored relevant material” so as to commit a jurisdictional error described in Minister for Immigration and Multicultural Affairs v Yusuf (2001) 206 CLR 323 at [82], where McHugh, Gummow and Hayne JJ refer to a “not exhaustive” list of errors of law which are jurisdictional and are described in Craig v South Australia (1995) 184 CLR 163 at 179:
If such an administrative tribunal falls into an error of law which causes it to identify a wrong issue, to ask itself a wrong question, to ignore relevant material, to rely on irrelevant material or, at least in some circumstances, to make an erroneous finding or to reach a mistaken conclusion, and the tribunal’s exercise or purported exercise of power is thereby affected, it exceeds its authority or powers.
Counsel submitted that the Tribunal had made this error when addressing the Form 1067 undertaking to “comply with Australian industrial relations laws, Australian levels of remuneration, and conditions of employment”, which it had “touched upon” in paragraph [24] of its reasons (see above).
Counsel submitted that the Tribunal had ignored “actual Australian Industrial Laws, conditions of employment and salary levels”. Counsel submitted that unless the Tribunal had satisfied itself that specific industrial legislation, awards or agreements could not be met, and stated why those particular instruments could not be met, “then it errs in law to conclude that the applicant cannot meet them.”
Counsel submitted that, rather than making reference to award rates of salary or evidence of market rates in comparable employments, the Tribunal had guessed rather than made an appropriate enquiry and had therefore failed to determine whether or not Mrs Zhu’s previous salary of $18,200 was below Australian standards.
I do not accept these submissions, since I consider that they misunderstand the legal issue for determination, and do not appreciate the reasoning process of the Tribunal in the paragraphs I have extracted above.
Under reg 1.20B(2)(f) it was open in law for the Tribunal to decide that the criteria were not met if it failed to be “satisfied” as to the ability to comply with, inter alia, the salary undertaking. It was not obliged to address the evidence and make a positive conclusion as to inability to comply before it could affirm the delegate’s decision. Nor, in my opinion, was it obliged to conduct further inquiries and locate evidence of awards or comparable salaries upon which to make a finding on the issue. If, as the Tribunal thought in the present case, the evidence did not allow a positive opinion on the comparison raised by the language of the salary undertaking, but did raise a doubt as to the sufficiency of a salary, then in my opinion it would be open to a Tribunal to decline to reach the requisite satisfaction as to that salary.
In the present case, I do not read the Tribunal as indicating more than this when it says “this raises considerable doubt as to whether the review applicant is complying with both Australian remuneration levels and its undertakings in relation to the visa applicant.” Its next sentence confirms that it had not felt able to reach a positive opinion on “the suitability of this salary level”. I do not read the Tribunal as arriving at a positive conclusion that in fact the salary of $18,200 was not a salary satisfying the description in the undertaking, but, rather, that the material put forward by Tide Sequence did not satisfy it as to that fact. This was, in the Tribunal’s assessment, one of the aspects of the undertaking about which it failed to be satisfied.
I do not consider that this reasoning shows any error of law. On the material before the Tribunal, I consider that it was open to the Tribunal to fail to be satisfied that Tide Sequence had the ability to pay in the future the proposed salary of $45,000. I also consider that it was open to it to fail to be satisfied that the current salary of $18,200 with shareholder entitlements met the standards identified in the Form 1067 undertaking. I do not consider that it was obliged to refer to information on comparable employments before concluding that it was not satisfied. It was open to the Tribunal to consider that the evidentiary onus to present information establishing compliance was on the applicant and that it had not been met.
As was said by R D Nicholson J in Lace Holdings Pty Ltd v Minister for Immigration and Multicultural Affairs (2002) 117 FCR 79 at [34] (adopted by the Full Court in MM International (Australia) Pty Ltd v Minister for Immigration & Multicultural & Indigenous Affairs [2004] FCAFC 323 at [11]):
“Satisfaction as to an applicant’s ability to comply with the undertakings is a finding of fact and degree for the Tribunal based on the circumstances of the case. The possibility that the Tribunal’s finding of fact is in error or that the court may have made a different finding of fact is not a permissible basis for review…”
Ground 2
The MRT committed a jurisdictional error of law in reaching a mistaken conclusion, being (a) the applicant could not afford to pay Mrs Zhu the appropriate salary.
Counsel for the applicant argued that this conclusion was a “mistaken conclusion” within the principle from Craig’s Case cited above, because it failed to take into account that the total salaries paid by Tide Sequence each year to Mrs Zhu and her two fellow directors exceeded $45,000, so that it had a capacity to pay her that amount.
This submission, as with the first ground, overlooks that the challenged part of the Tribunal’s reasons explains that it lacked satisfaction that Tide Sequence could pay the promised rate of salary, not that it was positively satisfied that it could not do so. This is shown in its language: “it does not appear that the review applicant could afford to pay the visa applicant the appropriate salary”.
Moreover, on the evidence, the other two directors had superior ownership and management positions in the company, and it was open to the Tribunal to think it unlikely that they would accept a diminution in their current salaries. Counsel for the applicant did not dispute that the evidence before the Tribunal concerning the company’s finances allowed the Tribunal to conclude that it would not be able to continue the current rate of the salaries of the other two directors as well as paying Mrs Zhu $45,000.
In any event, I consider that this ground of appeal is manifestly seeking to challenge a finding which involved purely a question of fact. Counsel’s argument which attempted to turn it into a jurisdictional error, in my opinion, involved a clear misreading of the passage from Craig’s Case which was adopted in Yusuf in the passage cited above. A “mistaken conclusion” can only reveal jurisdictional error if it was caused by the Tribunal “falling into an error of law” (and also perhaps only “in some circumstances”). No error of law was involved here.
I consider that both grounds for this application fail, and that it must be dismissed.
As noted above, counsel for Mrs Zhu agreed that this outcome must also result in the dismissal of Mrs Zhu’s application.
I can see no reason why costs should not follow the event in both matters.
I certify that the preceding twenty-six (26) paragraphs are a true copy of the reasons for judgment of Smith FM
Associate: Iliya Marovich-Old
Date: 12 January 2005
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