Wang v Minister for Immigration
[2020] FCCA 1252
•22 May 2020
FEDERAL CIRCUIT COURT OF AUSTRALIA
| WANG & ORS v MINISTER FOR IMMIGRATION | [2020] FCCA 1252 |
| Catchwords: MIGRATION – Application for Business Talent Visa – failure to meet clause 132.224 criteria – no jurisdictional error – application dismissed. |
| Legislation: Migration Act 1958 (Cth), ss.51A, 55, 134(10). Migration Regulations 1994 (Cth), r.1.03, Schedule 2, cl.132.1, cl.132.224. |
| Cases cited: Minister for Immigration and Citizenship v SZMDS (2010) 240 CLR 611. Khalil v Minister for Home Affairs [2019] FCAFC 151. Ratu v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs [2019] FCA 1710. Minister for Immigration and Border Protection v Pandey [2014] FCA 640. Minister for Immigration and Citizenship v Li (2013) 249 CLR 332. Minister for Immigration and Border Protection v SZMTA (2019) 264 CLR 421. |
| First Applicant: | YANGANG WANG |
| Second Applicant: | LIU YU |
| Third Applicant: | JIAYI WANG |
| Fourth Applicant: | YICHENG WANG |
| Respondent: | MINISTER FOR IMMIGRATION, CITIZENSHIP, MIGRANT SERVICES AND MULTICULTURAL AFFAIRS |
| File Number: | BRG 626 of 2019 |
| Judgment of: | Judge Egan |
| Hearing date: | 29 January 2020, 19 May 2020 |
| Date of Last Submission: | 19 May 2020 |
| Delivered at: | Brisbane |
| Delivered on: | 22 May 2020 |
REPRESENTATION
| Counsel for the Applicant: | Mr Steele |
| Solicitors for the Applicant: | MHL Legal |
| Counsel for the Respondent: | Mr Byrnes |
| Solicitors for the Respondent: | MinterEllison |
ORDERS
The Further Amended Application for review filed on 7 February 2020 be dismissed.
The First and Second Applicant pay the Respondent’s costs of and incidental to the application for review fixed in the amount of $5,600.00.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT Brisbane |
BRG 626 of 2019
| yangang wang |
First Applicant
| liu yu |
Second Applicant
| jiayi wang |
Third Applicant
| yicheng wang |
Fourth Applicant
And
| Minister for Immigration, citizenship, migrant services and multicultural affairs |
Respondent
REASONS FOR JUDGMENT
Introduction
On 8 September 2017, the first applicant applied for a Business Skills – Business Talent (Migrant) (Class EA) Business Talent (Subclass 132) visa (‘the visa’). The second applicant is the first applicant’s wife and the third and fourth applicants are the children of the first and second applicant.
In his application, the first applicant nominated Beijing Xincai Ruihe Printing Factory as his main business. The years 2015 and 2016 were nominated for consideration for the purpose of satisfying the requirements for the grant of the visa. In that regard, cl. 132.224 of Schedule 2 to the Migration Regulations 1994 (Cth) (‘the Regulations’) relevantly provided as follows:
“132.224
For at least 2 of the 4 fiscal years immediately before the time of invitation to apply for the visa:
(a) the net value of the assets of the applicant, the applicant’s spouse or de facto partner, or the applicant and his or her spouse or de facto partner together, in a qualifying business or qualifying businesses in which the applicant had an ownership interest was at least AUD400 000; and
(b) if a qualifying business mentioned in paragraph (a) was operated by a publicly listed company, the shareholding of the applicant, the applicant’s spouse or de facto partner, or the applicant and his or her spouse or de facto partner together, was at least 10% of the total issued capital of the company.”
It is common ground that in 2009 the first applicant and the second applicant acquired 100% ownership of the business, each having a 50% share.
It was contended on behalf of the first applicant that in August 2015, the first and second applicants had made a capital contribution of RMB 8 million into the business, with the result that the capital of the business increased from RMB 2 million to RMB 10 million. A schedule indicating the first and second applicants’ equity in the business was prepared by a Hong Kong firm of public accountants on behalf of the first applicant as follows: [1]
[1] Court Book (CB) p. 85.
It was claimed by the first applicant that for at least two (2) of the four (4) fiscal years immediately before the time of invitation to apply for the visa, the net value of the assets of the applicant and his wife in the business exceeded the AUD $400,000.00 qualifying amount. At the hearing before the Court, it was common ground that:
a)the business was a “qualifying business”;
b)the first applicant and the second applicant owned all of the shares in the company which owned and ran the business.
By a letter dated 12 April 2019 sent by the Department of Home Affairs, the first applicant was advised that his application for the visa had been refused.
Findings of the Delegate
It was noted by the delegate that according to the Capital Verification Report dated 3 August 2015, as well as bank slips of that date, all capital in the company was paid up.
On page two (2) of the reasons of the delegate, reference was made to the public accountant’s report of Ling Wai Ming & Co as having recorded that the net asset value of the business attributable to the first applicant and the second applicant was as follows:
“RMB8.35m/AUD1.77m as at 31/12/2015, at exchange rate 4.73
RMB8.41m/AUD1.68m as at 31/12/2016, at exchange rate 5.02”
At pages 2 and 3 of the reasons of the delegate, the delegate recorded that in view of the financial performance of the factory, [2] and the lack of evidence substantiating the source of funding for the alleged capital injection of RMB 8 million, she was unable to make a finding that the claimed value of the equity in the business had been established as claimed.
[2] See accumulated losses recorded in table at CB p. 85.
At page 3 of the reasons of the delegate, it was recorded that by letter dated 23 November 2018, [3] the first applicant was requested to provide further information in relation to the application for the visa within a twenty-eight (28) day period. The requested detail in relation to cl. 132.224 matters was as follows: [4]
[3] CB pp. 374 – 376.
[4] CB p. 379.
“Request Detail
Clause 132.223 The applicant has overall had a successful business career
The submitted review report of Beijing Xincai Ruihe Printing Factory (the Company) reveals that the Company has been suffering from accumulated losses and the balances are as follows:
Retained loss of (RMB0.95m) as at 31/12/2014
Retained loss of (RMB1.65m) as at 31/12/2015
Retained loss of (RMB1.59m) as at 31/12/2016
Retained loss of (RMB1.55m) as at 30/06/2017
In view of the financial performance of the Company, I am unable to make a finding that you have overall had a successful business career and that you have satisfied Clause 132.223.
Please address the basis on which you consider yourself to meet the requirement of clause132.223 with reference to the losses that the Company has suffered from.
Please submit the financial statements, Enterprise Income Tax returns and corresponding receipts of the Company for the year ended 31/12/2017 and year-to-date 2018 to demonstrate the recent financial performance of the Company.
Clause 132.224 Net Business Assets
Clause 132.225 Main business – Ownership, Management and Turnover
Clause 132.226 Net assets available for transfer
#It is noted from the business license of the Company that it is registered as a collective ownership (joint stock) business, instead of private enterprise. Please explain.
#Please submit a detailed declaration, with supporting evidence, in relation to the source of funds for your capital investment totalling RMB10m into the Company. Please provide supporting documents in the form of personal income tax payment relating to your income received as well as historical bank records to substantiate the accumulation of your wealth.
Please submit historical bank records to clearly demonstrate the transfer of funds from your and your spouse’s bank accounts to the Company’s account for the additional capital investment totalling RMB8 made by you and your spouse in 2015.
Please note that in establishing an applicant’s claimed ownership of a business, the decision maker must reach a reasonable degree of satisfaction that the applicant is indeed the true owner. In light of your substantial investment in the Company; the little evidence provided on its source and the accumulated losses incurred by the Company, the source of funds for your investment in the Company needs to be further established in order to determine if you are in fact the owner of the Company and that your fund had been legally acquired.”
(Emphasis added)
The first applicant’s lawyers responded to the request for information by a letter dated 18 December 2018. The documentation provided was prepared by Ling Wai Ming & Co, and was substantial. Though dated after the date of the letter of response, a declaration of the first applicant dated 19 December 2018 was also said to have been sent with the letter.
The letter from the first applicant’s lawyers provided as follows: [5]
[5] CB pp. 381 – 383.
“18 December 2018
Ms Janice Tang
Visa Processing Officer (Position Number: [omitted])
Hong Kong Business Skills Processing Centre
Department of Home Affairs
[Address omitted]Dear Ms Tang
Application for Business Talent (Permanent) Visa under Significant Business History Stream (Subclass 132)
Primary Applicant: WANG, Yangang (DOB [omitted])
Secondary Applicant: LIU, Yu (DOB [omitted])
Migration Dependent: WANG, Jiayi (DOB [omitted])
WANG, Yicheng (DOB [omitted])
EOI Reference No: [omitted]
TRN Reference No: [omitted]
File No: [omitted]
We refer to the request for further information dated 23 November 2018, and address each time of the requested details adopting your headings as follows:
Clause 132.223 The applicant has overall had a successful business career
Enclosed please see the letter of clarification Ling Wai Ming & Co Certified Public Accountants (Practising) addressing your inquiry about the “retained loss” in the ISRE 2400 Review Report dated 30 August 2017 (“the ISRE Report), with Attachments marked A-D.
Further enclosed please find certified true copies of the recent Financial Statements of Beijing Xincai Ruihe Printing Factory (“the Company”) and tax receipts covering the period from 1/1/2017 – 30/09/2018 and its English translation.
Clause 132.224 Main business – Ownership, Management and Turnover
The company was registered on 16 September 1999 as a collective (joint stock) business. Privately funded Collective Enterprises [Chinese characters] are recognised business operation vehicles under the Guide to Documentation Requirements for Business Innovation and Investment Visa Applications from the People’s Republic of China (PRC).
The subject business was registered as a private collective enterprise by the previous owner. It was transferred to our client and his wife pursuant to the transfer agreement dated 29 April 2009 (see Appendix XIII(c) of the ISRE Report) and the status of business category has remained unchanged since the business transfer.
The initial registration capital of the Company was increased from RMB 2,000,000 to RMB 10,000,000 by our clients in 2015 (see Notarised Capital Verification Report in Item 4 of the supporting documents submitted with the visa application).
Our clients funded the share capital increase by paying into the Company RMB 4,000,000 each on 3 August 2015. These funds were raised by personal loans which were subsequently repaid largely from the sale proceeds of our clients' properties (totally RMB 5,880,000) and bank finance (approximately RMB 1,500,000).
Clause 132.224 Net Business Assets
Enclosed please find a declaration on lawful source of funds signed by our client and the certified true copies of following documents in support of the declaration:
1. China Construction Bank online statement showing the Primary Applicant’s transfer of RMB 4,000,000.00 into the Company’s account dated 3 August 2015
2. China Construction Bank online statement showing the Secondary Applicant’s transfer of RMB 4,000,000.00 into the Company’s account dated 3 August 2015
3. Beijing Municipality Contract dated 11 August 2015 for sale of the Primary Applicant’s property at [address omitted] (RMB 2,280,000)
4. Beijing Municipality Contract dated 21 May 2016 for sale of by the Secondary Applicant's property at [address omitted] (RMB 3,600,000)
5. Mortgage Agreement with SPD Bank signed by the Primary Applicant dated 4 May 2016(RMB 1,500,000)
6. ICBC Certificate of Personal Credit / Worthiness dated 15 December 2017 for bank deposit of RMB 1,500,00
Members of Family Unit
We confirm that the applicants’ daughter Jiayi Wang is a full-time university student in Canada, after completing high school in Alberta in July 2018. She is financially dependent on her parents for her living and education costs.
The applicants now have a son, Yicheng Wang who was born on [DOB omitted]. Both applicants are the biological parents who did not plan the child at the time of lodging the visa application in September 2017.
Further enclosed please find certified true copies of the following documents:
7. Canadian student visa issued by Immigration, Refugee and Citizenship Canada on 2 June 2018 to Jiayi Wang with the expiry date of 31 July 2022
8. Letter issued by Alberta Education on 20 July 2018 to Jiayi Wang
9. Medical Birth Certificate of the applicants’ new born son Yicheng Wang
10. Form 1022 – notification of change in circumstances
Please do not hesitate to contact the writer if you require further information to process the visa application.
Yours sincerely
MHL LEGAL & NOTARY
Lynn Hu
Lawyer & Migration Agent No. [omitted]”
The declaration of the first applicant provided as follows: [6]
[6] CB p. 440.
“DECLARATION
LAWFUL SOURCE OF FUNDS
My name is Yangang Wang. I am a Chinese citizen holding passport number [omitted] and the Primary Applicant under application bearing Transaction Reference Number [omitted].
LAWFUL SOURCE OF FUNDS
By way of business background, I worked as the General Manager for Beijing Changping Benteng Printing Factory from March 2007, and was in charge of the day-to-day management of the business.
I acquired all shares in Beijing Changping Benteng Printing Factory ("the Company") in early 2009, with 50% shares held by me and the other 50% shares held by my wife, Ms Yu Liu. The
In 2015, my wife and I borrowed an amount of RMB 8,000,000.00 from family and friends, and invested into the Company to increase its registered capital to RMB 10,000,000.00.
On 30 October 2015, I sold my property in Beijing, China for RMB 2,280,000.00. A certified copy of the English translation of the property sale contract is provided with the application.
On 4 May 2016, I financed against my property at [omitted] with SPD Bank in China for an amount of RMB 1,500,000.00. A certified copy of the English translation of the mortgage agreement is provided.
On 21 May 2016, my wife, Liu Yu, sold her property in Beijing, China for RMB 3,600,000.00. A certified copy of the English translation of the property sale contract and the personal income tax payment receipt is provided.
The personal loans of RMB 8,000,000.00 were repaid with the abovementioned funds.
After years of working and running our own business, my wife and I have accumulated personal assets of approximately AUD 2,000,000 through work, savings and property investments, in addition to our business assets in the Company.
Dated: 19 December 2018
Signed by: [Signature of Yangang Wang]
Witnessed by: [Signature of Lynn Hu]”
Though the first applicant had declared that the RMB 8 million personal loan from family and friends had been repaid from the proceeds of sale of three (3) properties owned by him and his wife between October 2015 and May 2016, the total proceeds of such sales totalled RMB 7.38 million, rather than the RMB 8 million as claimed.
At pages 3 and 4 of the reasons of the delegate, the reasons for refusing the visa were set out as follows:
“Based on all the evidence submitted, I was not able to make a finding that the source of fund for your additional capital investment of RMB8m invested in 8/2015 has been established because
- there was no evidence submitted to substantiate your declared loans borrowed from your family and friends as well as the subsequent settlements;
- there was no independently verifiable evidence including title deeds, bank records and tax document to support your ownership/sales of properties and the receipts of the corresponding sales proceeds;
- there was no information or evidence as to when the declared loans were repaid. As such, the net business assets attributable to you as at 31/12/2015 and 31/12/2016 could not be determined. You do not meet the threshold requirement as stipulated under clause 132.224 after deducting the declared loan of RMB8m;
- notwithstanding the bank-in slips dated 03/08/2015,[7] the source of your fund totalling RMB8m transferred to the Factory remained unaccounted for.”
[7] CB p. 441.
(Footnote added)
On 29 March 2019, the delegate sent an email to the first applicant’s representative which gave notice that eligibility for the grant of the visa had not been established. The email provided as follows: [8]
[8] CB p. 513.
“Ms. Lynn HU (MARN: [omitted])
MHL Legal & Notary
Dear Ms. Hu
The applicants listed below have authorised you to receive correspondence on their behalf.
WANG, Yangang [Chinese characters] (Primary Applicant, [DOB omitted], M)
LIU, Yu [Chinese characters] (Spouse, [DOB omitted], F)
WANG, Jiayi [Chinese characters] (Child, [DOB omitted], F), aged [omitted]
WANG, Yicheng [Chinese characters] ([DOB omitted], M)
Please see the information below regarding their application for a subclass 132 Business Talent visa (Class EA) in the Significant Business History stream.
BY ELECTRONIC MAIL
Dear Mr. Wang
The further document was received on 24/12/2018. Based on all information available, I am not able to make a finding that your eligibility for visa grant has been established.
You declared that the additional capital investment of RMB8m invested into the Company in 8/2015 by you/your spouse was sourced from loans you borrowed from family and friends and you subsequently repaid the loan with proceeds totalling RMB5.88m from sales of 2 properties and a loan totalling RMB1.5m pledged with another property. 2 property sales contracts and a mortgage agreement were submitted as evidence.
Based on the evidence submitted, I am not able to make a finding that your source of fund has been established because
- there is no evidence submitted to substantiate your declared loans borrowed from your family and friends as well as the subsequent settlement
- there is no independently verifiable evidence including title deeds, bank records and tax document to support your ownership/sales of properties
- there is no information or evidence as to when the declared loans were repaid. As such, the net business assets attributable to you as at 31/12/2015, 31/12/2016 and 30/06/2017 cannot be determined. You do not meet the threshold requirement after deducting the declared loan of RMB8m.
Therefore, amongst others, I cannot make a finding that you meet clauses 132.224 and 132.226.
This is a courtesy email before the finalization of the application, considering that some applicants have requested an opportunity to withdraw should their application be unsuccessful.
I will proceed to finalizing the application shortly.
Regards
Janice Tang
Hong Kong Business Skills Processing Centre
Immigration and Border Protection
Department of Home Affairs
Australian Consulate-General Hong Kong[Address omitted]”
It is of note that at the end of such email, it was recorded that the giving of the notice of the refusal of the visa in advance of the sending of the reasons for refusal was a “courtesy” so as to give the first applicant the opportunity of withdrawing his application before the finalisation of the application process.
By an email dated 3 April 2019 (11:50am), the first applicant’s legal representative made further submissions as follows: [9]
[9] CB pp. 511 – 512.
“From: Lynn Hu [email address omitted]
Sent: Wednesday, 3 April 2019 11:50 AM
To: Tang, Janice [email address omitted]
Cc: Migration MHL Legal [email address omitted]Subject: RE: WANG Yangang, [omitted] [SEC=UNCLASSIFIED]
Dear Ms Tang
We refer to your below courtesy email which is well appreciated.
We understand that you have doubts over the truthfulness of the personal loans the applicant and his wife borrowed to increase the registration capital of their company by RMB 8 million in 2015, and as such, the net value of the applicants’ business assets is in doubt.
The history of the applicants’ acquisition of the business, ownership interests in the business, and running of the business are well documented in the business documents submitted.
With respect to the RMB 8 million personal loans for increase of the registration capital which was confirmed by the notarised capital verification report dated 3 August 2015 and bank transfer records , the main applicant has provided a declaration with documents supporting the lawful source of funds used for repayment of the loans. As stated in the declaration, the loans were repaid following the property sales and finance. There is no loan agreement or repayment acknowledgment in writing with family and friends which is not uncommon. The applicants have been honest and have not attempted to create any documentary evidence which did not exist.
The sale of the applicants’ properties is supported by true copies of the duly executed contracts which bear the respective contract numbers [omitted] recorded with the housing administration authority [omitted]. It is a common practice in China that all taxes associated with the sale and purchase of a real property is paid by the buyer and the seller is paid the net sale price as stated in the contract which is the case here. As such, the relevant tax statements are kept by the buyers who paid the taxes, not the sellers. Title Deeds are also cancelled and reissued in the names of the buyers upon the registration of transfer of ownerships.
In our respectful submissions:
·The applicants increased the share capital by funds loaned to them based on their personal assets, eg real properties they owned and cash funds freed from the property sales which occurred shortly afterward. At the very least, the property values realised from the sales totalling RMB 5,880,000 shall be fully attributable to the net value of their business assets. The applicants meet clause 132.224.
·Even without the increase of share capital, the applicants still meet clause 132.224 by virtue of the initial registration capital of RMB 2 million which is equivalent to AUD 400,000.
So far as net personal assets are concerned, we refer you to the SALP Form 1139a submitted on 13 September 2017, and the attached ICBC statements dated 6 July 2017 and 15 September 2017 respectively, evidencing the value of financing products and cash deposit held by the main applicant. As our clients’ migration agent, we did not include any business assets in the SALP as on our instructions the applicants need not utilise any of the business assets (including business loans) to meet clause 132.226.
We would greatly appreciate if you could give further consideration of our clients’ application before making any unfavourable decision.
Please feel free to contact me should you wish to discuss any aspect of the application, or require further information to be provided.
Regards
Lynn Hu | Lawyer & Notary Public
MHL Legal & Notary | [Address omitted]
Phone + [omitted] | Fax + [omitted] | Email [omitted]Postal [omitted], Brisbane, QLD 4001 | Website >
The delegate responded to that email by an email dated 4 April 2019 (4:32pm) as follows: [10]
[10] CB pp. 510 – 511.
“From: Tang, Janice
Sent: Thursday, 4 April 2019 4:32 PM
To: [Lynn Hu] [Email address omitted]Subject: FW: WANG Yangang, [omitted]
UNCLASSIFIED
Dear Ms. Hu,
I noted the nominated cash assets stated in the SALP Form submitted, however, the “ICBC Financing Products Certificate (RMB7.6 million)” was not submitted at lodgement or in the further submission received on 24/12/2018. Only the “ICBC Certificate of Deposit (RMB1.5million)” has been submitted. As such, I had turned my mind to assessing other possible assets, i.e. net business assets of the main business, for the purposes of clause 132.226.
Clause 132.226
All the nominated assets must be valued at the same date (within 3 months prior to the date of invitation). Even if the cash assets are given consideration, its source of fund remains unaccounted for in view of the accumulated losses incurred by the main business and the lack of evidence to substantiate how the applicant had accumulated the declared wealth.
Clause 132.224
The threshold requirement is not met after deducting the additional capital investment of RMB8m due to the accumulated losses incurred by the main business.
Given the large volume of applications under assessment, I am not able to communicate further on this application. I will be returning to office on 9/4 when I will proceed to finalizing the application based on all information available.
Regards
Janice Tang
Hong Kong Business Skills Processing Centre
Immigration and Border Protection
Department of Home Affairs
Australian Consulate-General Hong Kong
[Address omitted]
P: + [omitted]
E: [Email address omitted]Website: | hongkong.consulate.gov.au”
It is of note that it was said at the end of such email that the delegate would be returning to the office on 9 April 2019, at which time she would proceed to finalise the application based on the information available to her.
No further material was provided to the delegate between 4 April 2019 and 10 April 2019. On 10 April 2019, the lawyers for the first applicant sought an extension of the time, for consideration of the application, of a further twenty-eight (28) days. [11] It was said that the first applicant may be able to locate some old photocopies of title deeds as well as documentation going to proof of income from share trading and property sales.
[11] CB p. 509.
The delegate responded on 10 April 2019 by advising that no further extension of time would be considered “given the large volume of applications under processing”. [12]
[12] CB p. 509.
The delegate gave her reasons for refusing the visa by email sent on 12 April 2019.
On 8 November 2019, the first applicant filed an application for review of the decision of the delegate. On 7 February 2020, the applicant’s legal representatives filed a Further Amended Application for review. Of the six (6) grounds for review relied upon by the applicant at the hearing, it was helpfully conceded by Mr Steele of Counsel for the applicant that there were effectively only two (2) grounds for review as follows:
First Ground – (a), (d), (e) and (f)
(a) the Respondent erred in the construction of clause 132.224 of the Migration Regulations 1994 (Cth), such that the Respondent asked itself the wrong question, made an erroneous finding, and/ or reached a mistaken conclusion;
Particulars
The Respondent erroneously construed clause 132.224 as requiring her to be able to make a finding that the Applicant's claimed ownership of the equity of the relevant qualifying business had been established; that is, so as to oblige the Applicants to provide evidence in a particular manner or form to substantiate the source of funds for his capital investment in the qualifying business as determined by the Respondent
(d) the Respondent's decision was illogical or unreasonable because the conclusion that the criteria for the grant of a Business Talent (subclass 132) visa was not satisfied was not supported by the materials before him.
Particulars
The materials provided by the Applicant satisfied the criteria for the grant of a Business Talent(subclass 132) visa
(e) the respondent took into account an irrelevant consideration, namely the source of the funds for the applicant's ownership interest in a qualifying business.
(f) the respondent wrongly construed criterion 132.224 in Schedule 2 to the Migration Regulations 1994:
Particulars
i. By wrongly concluding that criterion 132.224 required the applicant to show the source of the funds used to acquire his ownership interest in a qualifying business;
ii. By failing to find that the applicant had satisfied criterion 132.224 in circumstances where the applicant had an ownership interest in a qualifying business, and had the net value of the assets in the qualifying business in excess of AUD 400,000 for 2 of the 4 fiscal years immediately before the time of invitation to apply for the visa.
Second Ground – (b) and (c)
(b) the Respondent failed to afford the Applicants procedural fairness because the Respondent proceeded to finalise the application by way of making an adverse decision, notwithstanding the clarification of the issues of the delegate's concerns by the Applicants' lawyer, and a request made on behalf of the Applicants to await further documentation and information the Applicants anticipated could, and would, be provided to the Respondent;
Particulars
Email from Ms Janice Tang to Ms Lynn Hu dated 10 April 2019 at 12:58 PM refusing further communication on the visa application given the large volume of applications under processing and denying any extension of time sought by the Applicants.
Ms Tang's earlier email dated 29 March 2019 at 6.28pm indicated concerns with the further information and material provided by the Applicants on 18 December 2018, and that the Applicants' visa application would be determined regardless.
Email from Ms Lynn Hu to Ms Janice Tang at 1 :50pm on 3 April 2019 addressed the concerns raised by Ms Janice Tang, and by email reply at 6:33pm on 4 April 2019, Ms Janice Tang advised that she still maintained her lack of satisfaction of the materials provided by the Applicants, but would finalise the application based on all information available when she returned to the office on 9 April 2019.
Ms Hu by email dated 10 April 2019 at 10.26arn sought a grace period of 28 days within which the Applicants could provide further material.
(c) the Respondent failed to afford the Applicants procedural fairness because the Respondent failed to address, in reasons and findings, submissions and independently verifiable evidence advanced on their behalf centrally relevant to the decision being made and, as such, did not take those submissions and evidence into account;
Particulars
i. Bank deposit receipts issued by China Construction Bank dated 3 August 2015
ii. Capital Verification Report by Beijing Runpengjineng Certified Public Accountants dated 3 August 2015
iii. Business licence for Beijing Xincai Ruihe Printing House dated 24 August 2017
iv. Company extract issued by Beijing Administration of Industry and Commerce (AIC) of People's Republic of China dated 29 August 2017
v. Property title deeds attached to the email from Ms Lynn Hu to Ms Janice Tang dated 12 April2019 at 9:00AM”
First Ground
The First Ground is a contention that the delegate misconstrued the requirements of cl. 132.224 by proceeding to consider the personal liabilities of the first and second applicants when deciding whether the value of the ownership interest in the business exceeded AUD $400,000.00 or not. It was submitted that there was nothing in the relevant criteria or legislation which required that the net ownership interest in the business must be sourced from the applicant’s own funds, or indeed, in any particular way.
By regulation 1.03 of the Regulations, the term “ownership interest” had the meaning as set out in s. 134(10) of the Migration Act 1958 (Cth) (‘the Act’) which provided as follows:
“Section 134 – Cancellation of business visas
…
(10) In this section:
…
“ownership interest”, in relation to a business, means an interest in the business as:
(a) a shareholder in a company that carries on the business; or
(b) a partner in a partnership that carries on the business; or
(c) the sole proprietor of the business;
including such an interest held indirectly through one or more interposed companies, partnerships or trusts.”
Note 3. to cl. 132.1 of Schedule 2 to the Regulations provided as follows:
“For beneficial ownership of an asset or ownership interest: see regulation 1.11A.”
Regulation 1.11A(1) and (2) provided as follows:
“Regulation 1.11A – Ownership for the purposes of certain Parts of Schedule 2
(1) Subject to subregulation (4), for Parts 132, 188, 888, 890, 891, 892 and 893 of Schedule 2, ownership by an applicant, or the applicant's spouse or de facto partner, of an asset, an eligible investment or an ownership interest, includes beneficial ownership only if the beneficial ownership is evidenced in accordance with subregulation (2).
(2) To evidence beneficial ownership of an asset, eligible investment or ownership interest, the applicant must show to the Minister:
(a) a trust instrument; or
(b) a contract; or
(c) any other document capable of being used to enforce the rights of the applicant, or the applicant's spouse or de facto partner, as the case requires, in relation to the asset, eligible investment or ownership interest;
stamped or registered by an appropriate authority under the law of the jurisdiction where the asset, eligible investment or ownership interest is located.”
The term “net value of the assets of the applicant … in a qualifying business … in which the applicant had an ownership interest” was not defined. The definition of “net asset value” in the Encyclopaedic Australian Legal Dictionary was “net worth, the difference between the total assets and the total liabilities of a company, institution or individual.”
It is clear that the delegate engaged in an active intellectual consideration of what was required to establish a net ownership interest value of at least AUD $400,000.00. The delegate had regard to the first applicant’s claims that the RMB 8 million in loan money had been repaid from the sale of properties, but was not satisfied, after consideration of the material provided to her, that any amount of the RMB 8 million had been repaid. She pointed to the lack of provision to her of requested historical bank records showing ownership of that RMB 8 million fund. Such request was a basic one in circumstances where the delegate was asking for proof that the alleged capital injection had been made from the banking accounts of the first and second applicants rather than from some third party.
The delegate further noted that there was no independent evidence in the nature of tax receipts or bank records which substantiated the receipt of any of the claimed proceeds of sale of properties, or of the alleged use of such proceeds of sale for repayment of the alleged loan.
The delegate appropriately had regard to such lack of substantiation of the alleged repayment of a large amount of money when assessing whether the AUD $400,000.00 threshold had been met. The delegate decided that the RMB 8 million amount was not to be taken into consideration for the purpose of assessing whether cl. 132.224 had been satisfied or not. The delegate did so in the third paragraph on page 5 of the reasons as follows: [13]
[13] CB p. 545.
“Without counting the additional capital investment of RMB8m in 8/2015, your share of net business assets of the Company became:
RMB352,468 (RMB8,352,468 – RMB8m) / AUD74,518 as at 31/12/2015
RMB414,818 (RMB8,414,818 – RMB8m) / AUD82,633 as at 31/12/2016”
The delegate based her findings on the net value of the first and second applicant’s assets in the business. The Court rejects the submissions made on behalf of the applicants to the effect that one has to look to the asset account of the business – as per the first applicant’s accountant’s schedule – for the purpose of determining what the first and second applicant’s net asset value in the business was, rather than looking to the net value of such interest after liabilities had been taken into account. The delegate was entitled to find that the first applicant had not shown that the substantial loan liability had been extinguished.
The first applicant had failed to provide the delegate with all of the information which was needed for the delegate to be satisfied that the AUD $400,000.00 threshold had been met. In those circumstances, the delegate appropriately refused to grant the visa. She did not misapply cl. 132.224. Nor did she err in her decision making processes. Further, it cannot be said that no other rational or logical decision maker could not have made the same decision as the delegate. As was said by Crennan and Bell JJ in Minister for Immigration and Citizenship v SZMDS (2010) 240 CLR 611 at [130] and [135]:
“[130] In the context of the Tribunal's decision here, "illogicality" or "irrationality" sufficient to give rise to jurisdictional error must mean the decision to which the Tribunal came, in relation to the state of satisfaction required under s 65, is one at which no rational or logical decision maker could arrive on the same evidence. In other words, accepting, for the sake of argument, that an allegation of illogicality or irrationality provides some distinct basis for seeking judicial review of a decision as to a jurisdictional fact, it is nevertheless an allegation of the same order as a complaint that a decision is "clearly unjust" or "arbitrary" or "capricious" or "unreasonable" in the sense that the state of satisfaction mandated by the statute imports a requirement that the opinion as to the state of satisfaction must be one that could be formed by a reasonable person. The same applies in the case of an opinion that a mandated state of satisfaction has not been reached. Not every lapse in logic will give rise to jurisdictional error. A court should be slow, although not unwilling, to interfere in an appropriate case.
…
[135] On the probative evidence before the Tribunal, a logical or rational decision maker could have come to the same conclusion as the Tribunal. Whilst there may be varieties of illogicality and irrationality, a decision will not be illogical or irrational if there is room for a logical or rational person to reach the same decision on the material before the decision maker. A decision might be said to be illogical or irrational if only one conclusion is open on the evidence, and the decision maker does not come to that conclusion, or if the decision to which the decision maker came was simply not open on the evidence or if there is no logical connection between the evidence and the inferences or conclusions drawn. None of these applied here. It could not be said that the reasons under consideration were unintelligible or that there was an absence of logical connection between the evidence as a whole and the reasons for the decision. Nor could it be said that there was no probative material which contradicted the first respondent’s claims. There was. The Tribunal did not believe the first respondent’s claim that he had engaged in the “practice of homosexuality” in the UAE and accordingly it was not satisfied that he feared persecution if he returned to Pakistan.”
The delegate clearly engaged upon a consideration of the applicant’s claims and found against the applicant. It has long been accepted that different minds might legitimately reach different conclusions. As was said by Crennan and Bell JJ in SZMDS at [131]:
“[131] What was involved here was an issue of jurisdictional fact upon which different minds might reach different conclusions. The complaint of illogicality or irrationality was said to lie in the process of reasoning. But, the test for illogicality or irrationality must be to ask whether logical or rational or reasonable minds might adopt different reasoning or might differ in any decision or finding to be made on evidence upon which the decision is based. If probative evidence can give rise to different processes of reasoning and if logical or rational or reasonable minds might differ in respect of the conclusions to be drawn from that evidence, a decision cannot be said by a reviewing court to be illogical or irrational or unreasonable, simply because one conclusion has been preferred to another possible conclusion.”
Second Ground
This ground is a contention that the delegate failed to afford procedural fairness to the first applicant by failing to grant to him a further 28 days for the submission of further material to the delegate. The applicants relied upon the decisions in Khalil v Minister for Home Affairs [2019] FCAFC 151 and Ratu v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs [2019] FCA 1710 where principles relating to whether a party had or had not been given a reasonable opportunity to present their case had been discussed.
At the outset, it must be noted that the delegate’s decision was made in an entirely different statutory context to that of a decision being made by a tribunal or authority. Section 51A of the Act applied such that subdivision AB of Division 3 of the Act was taken to be an exhaustive statement of the requirements of the natural justice hearing rule in relation to the matters the subject of the Minister’s determination. Though a visa applicant might give to the Minister any additional information before a visa decision is made, the Minister is not required to delay making a decision because the applicant has said that they have more information or material to provide to the Minister. Section 55 of the Act applied to the circumstances of this matter, and was relevantly as follows:
“Section 55 – Further information may be given
(1) Until the Minister has made a decision whether to grant or refuse to grant a visa, the applicant may give the Minister any additional relevant information and the Minister must have regard to that information in making the decision.
(2) Subsection (1) does not mean that the Minister is required to delay making a decision because the applicant might give, or has told the Minister that the applicant intends to give, further information.”
The delegate was under no statutory obligation to ensure that a visa applicant was given a reasonable opportunity to present his or her best possible case. It was not legally unreasonable for the delegate to not afford even more time to the first applicant to provide requested documentation.
On the question as to whether something was legally unreasonable or not, Wigney J in Minister for Immigration and Border Protection v Pandey [2014] FCA 640 at [41] and [42] said as follows:
“[41] The relevant principles relating to legal unreasonableness in the context of decisions by the Tribunal to refuse adjournment applications have been the subject of recent extensive analysis by the High Court in Li and this Court in Minister for Immigration and Border Protection v Singh [2014] FCAFC 1 (Singh). The relevant principles may be summarised as follows:
(a) The requirement of reasonableness flows from or is connected with an implied legislative intention that a discretionary power that is statutorily conferred must be exercised reasonably: Li at [29], [63], [88]; Singh at [43].
(b) Legal unreasonableness can be a conclusion reached by a supervising Court after the identification of an underlying jurisdictional error in the decision-making process. Or it can be a conclusion reached without necessarily identifying another jurisdictional error: Li at [27]-[28], [72]; Singh at [44]. In the latter case unreasonableness may be taken to be unreasonableness from which an undisclosed error may be inferred: Li at [27], [68]; Singh at [44].
(c) Unreasonableness can be inferred where the decision appears to be arbitrary, capricious, without common sense or “plainly unjust”: Li at [28], [110]; Singh at [44].
(d) In those circumstances, where reasons are given, the supervising Court is concerned with seeing if there is an evident, transparent and intelligible justification within the decision-making process: Li at [105]; Singh at [44]-[45]. The intelligible justification must lie within the reasons given by the decision-maker: Singh at [47].
(e) Regard can also be given to the outcome of the decision: whether the “decision falls within a range of possible, acceptable outcomes which are defensible in respect of fact and law”: Li at [105] (Gageler J quoting Dunsmuir v New Brunswick [2008] 1 SCR 190 at 220-221; Singh at [44]-[45].
(f) The legal standard of reasonableness and the indicia of legal unreasonableness will need to be found in the scope, subject and purpose of the particular statutory provisions in issue in any given case: Li at [67]; Singh at [48]. In the case of discretionary powers vested in the Tribunal, the location of these powers in the statutory scheme, as aids to the performance of a review function, is important: Singh at [49].
(g) There is an overlap between the obligation in s 360 of the Act to invite an applicant to a hearing to present evidence and arguments and the exercise of the adjournment discretion in s 363. If, by reason of the refusal of an adjournment application, an applicant is not provided with an opportunity to present his or her evidence, it might be concluded that the hearing contemplated did not take place: Li at [62]; Singh at [51]-[52].
(h) The overriding duty of the Tribunal to review a decision may require the Tribunal, acting reasonably, to consider the exercise of the discretion to adjourn in a particular case. A failure to adjourn to allow a visa criterion to be met can, in some circumstances, be so unreasonable as to constitute a failure to review: Li at [100]-[102].
(i) It cannot be suggested that the Tribunal is under an obligation to afford every opportunity to an applicant for review to present his or her best possible case or improve upon the evidence. It may decide in an appropriate case that “enough is enough”: Li at [82]. The Tribunal is also under a duty to review decisions within a reasonable time: Li at [102].
(j) Properly applied, a standard of legal reasonableness does not involve substituting a Court’s view as to how a discretion should be exercised for that of a decision-maker: Li at [30], [66]; Singh at [47]. The test of legal unreasonableness is stringent: Li at [113].
[42] The question is whether, upon application of these principles, the decision of the Tribunal to refuse the adjournment here was legally unreasonable. Could the Tribunal’s decision be considered to be arbitrary, capricious, without common sense or plainly unjust? Do the Tribunal’s reasons disclose an evident and intelligible justification for refusing the adjournment application?”
The delegate had already made requests of the first applicant for substantiating documentation, and those requests had not been met, in circumstances where it was clear to the first applicant that the delegate was concerned about the loan repayment issue.
The delegate approached the decision making task in a considered and appropriate manner in circumstances where the first applicant had had more than ample opportunity to fully present his claims. The delegate’s decision did not lack an evident and intelligible justification as such respective concepts were considered by Hayne, Kiefel and Bell JJ in Minister for Immigration and Citizenship v Li (2013) 249 CLR 332 at [66] and [76] where it was said:
“[66] This approach does not deny that there is an area within which a decision-maker has a genuinely free discretion. That area resides within the bounds of legal reasonableness. The courts are conscious of not exceeding their supervisory role by undertaking a review of the merits of an exercise of discretionary power. Properly applied, a standard of legal reasonableness does not involve substituting a court's view as to how a discretion should be exercised for that of a decision-maker. Accepting that the standard of reasonableness is not applied in this way does not, however, explain how it is to be applied and how it is to be tested.
…
[76] As to the inferences that may be drawn by an appellate court, it was said in House v The King that an appellate court may infer that in some way there has been a failure properly to exercise the discretion "if upon the facts [the result] is unreasonable or plainly unjust". The same reasoning might apply to the review of the exercise of a statutory discretion, where unreasonableness is an inference drawn from the facts and from the matters falling for consideration in the exercise of the statutory power. Even where some reasons have been provided, as is the case here, it may nevertheless not be possible for a court to comprehend how the decision was arrived at. Unreasonableness is a conclusion which may be applied to a decision which lacks an evident and intelligible justification.”
Further, even if the delegate is found to have denied procedural fairness to the first applicant by failing to grant the requested twenty-eight (28) day extension, any such failure was, in the circumstances, not material. The further documentation which could possibly have been found by the first applicant within the twenty-eight (28) day period – namely old photocopies of previous title deeds and proof of income from share trading and property sales – could have been much earlier provided to the delegate. That the first applicant was, at the late stage of the application process, denied a further twenty-eight (28) days to provide such documentation, was not unreasonable. In any event, the nature of the documents which might have been able to have been produced by the first applicant were unlikely to allay the delegate’s concerns, and therefore could not have realistically resulted in the delegate arriving at a different decision.
In Minister for Immigration and Border Protection v SZMTA (2019) 264 CLR 421, Bell, Gageler and Keane JJ at [45] and [46] said as follows:
“[45] Materiality, whether of a breach of procedural fairness in the case of an undisclosed notification or of a breach of an inviolable limitation governing the conduct of the review in the case of an incorrect and invalid notification, is thus in each case essential to the existence of jurisdictional error. A breach is material to a decision only if compliance could realistically have resulted in a different decision.
[46] Where materiality is in issue in an application for judicial review, and except in a case where the decision made was the only decision legally available to be made, the question of the materiality of the breach is an ordinary question of fact in respect of which the applicant bears the onus of proof. Like any ordinary question of fact, it is to be determined by inferences drawn from evidence adduced on the application.”
No jurisdictional error has been established on the part of the delegate.
The Further Amended Application for review is without merit and is dismissed.
The Court will hear the parties as to costs.
I certify that the preceding forty-three (43) paragraphs are a true copy of the reasons for judgment of Judge Egan
Associate:
Date: 22 May 2020
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