XIAO v Minister for Immigration

[2017] FCCA 2964

FEDERAL CIRCUIT COURT OF AUSTRALIA

XIAO & ORS v MINISTER FOR IMMIGRATION & ANOR [2017] FCCA 2964

Catchwords:
MIGRATION – Application for judicial review of decision of Administrative Appeals Tribunal affirming decision not to grant first applicant an Employer Nomination (Permanent) (Class EN) Subclass 186 (Employer Nomination Scheme) visa – whether Tribunal reasoned irrationally by concluding it was not satisfied the nominating employer was willing or able to pay the first applicant an annual salary of $182,000 – whether Tribunal failed to have regard to the legal enforceability of employment contract purportedly pursuant to which the nominating employer agreed to pay the first applicant an annual salary of $182,000 – whether Tribunal failed to consider reasons nominating employer gave for being willing to pay first applicant annual salary of $182,000 – no jurisdictional error.

Legislation:

Migration Regulations 1994 (Cth), regs. 1.15C, 5.19, Schedule 2, subclass 186, cl.186.232

Cases cited:

NAJT v Minister for Immigration and Multicultural and Indigenous Affairs [2005] FCAFC 134

First Applicant: GANG XIAO

Second Applicant: LU NAI

Third Applicant: SUREN XIAO

First Respondent: MINISTER FOR IMMIGRATION & BORDER PROTECTION

Second Respondent: ADMINISTRATIVE APPEALS TRIBUNAL

File Number: SYG 2113 of 2015

Judgment of: Judge Manousaridis

Hearing date: 25 October 2016

Date of Last Submission: 25 October 2016

Delivered at: Sydney

Delivered on: 1 December 2017

REPRESENTATION

Counsel for the Applicants: Mr B Zipser

Solicitors for the Applicants: Zhang Shijing Lawyers

Solicitors for the First Respondent: Mr K Eskerie of Sparke Helmore

ORDERS

1. The application is dismissed.

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT SYDNEY

SYG 2113 of 2015

GANG XIAO

First Applicant

LU NAI

Second Applicant

SUREN XIAO

Third Applicant

And

MINISTER FOR IMMIGRATION & BORDER PROTECTION

First Respondent

ADMINISTRATIVE APPEALS TRIBUNAL

Second Respondent

REASONS FOR JUDGMENT

Introduction

1. The question that arises in this application for judicial review is whether the second respondent (Tribunal), in affirming the decision of a delegate of the first respondent (Minister) not to grant the first applicant an Employer Nomination (Permanent) (Class EN) Subclass 186 (Employer Nomination Scheme) visa (Visa), made a jurisdictional error in concluding it was not satisfied the first applicant would be employed for an annual salary of $182,000.

2. To understand the jurisdictional error the applicants claim the Tribunal made, it will be necessary to identify why the question whether the first applicant would be employed for an annual salary of $182,000 was an issue the Tribunal was required to consider.

Background

1. The criteria for the granting of the Visa are specified in subclass 186 of Schedule 2 to the Migration Regulations 1994 (Cth) (Regulations). That subclass presupposes that the application for the Visa relates to a position that has been nominated in an application that seeks to meet the requirements of reg.5.19 of the Regulations. Sub-regulation 5.19(1) provides that a person may apply to the Minister for approval of a nomination of a position in Australia.

2. Subclass 186 of Schedule 2 to the Regulations provides for three alternative sets of criteria which, together with common criteria, must be satisfied. The set of criteria that was relevant to the first applicant is the set of criteria named “Direct Entry stream”. One criterion under that stream is that the Minister has approved the nomination to which the application for the Visa relates. Another criterion is that an applicant have “competent English”, as that expression is defined in reg.1.15C of the Regulations, or that the applicant falls within the class or classes of persons specified in a legislative instrument made pursuant to cl.186.232 of Schedule 2 to the Regulations. Legislative Instrument IMMI 12/059 has been made pursuant to that clause, and it specifies two classes of persons. Relevant to the application before me is class 2 of IMMI 12/059 (Class 2 Exemption), which is described as follows:

   Persons who have applied under the Regulations for a visa, and whose earnings will be at least equivalent to the current Australian Tax Office top individual income tax rate.

3. It is common ground that $180,001 represents the earnings that at the relevant time were equivalent to the current Australian Tax Office top individual income tax rate.

The application for the Visa

1. The first applicant applied for the Visa on 4 September 2014. The second, third, and fourth applicants applied as members of the first applicant’s family unit. The positon in relation to which the first applicant applied for the Visa was Sales and Marketing Manager, which was nominated by Australian Lily Touring Pty Ltd (Nominator).[1]

   [1] CB30

2. The first applicant supported his application for the Visa with what purports to be a written contract of employment dated 4 September 2014 between the Nominator and the first applicant (Employment Contract).[2] The Employment Contract described the first applicant’s duties as consisting of, among other things, “managing the sales team, developing a business plan covering sales, revenue, meeting agreed targets, and promoting the organisation’s presence and products nationally and internationally”. The Employment Contract provided that the first applicant “will be paid at the rate of $182,000 per annum excluding 9.50% superannuation contributions to your designate [sic] superfund”.

   [2] CB39-46

The Tribunal’s reasons

1. In the course of its reasons the Tribunal expressed concerns about whether the first applicant’s “salary is a genuine figure”,[3] and whether “the salary is a genuine amount that would be paid”.[4] The Tribunal relied on a number of matters for these concerns.

   a)The salary “appears to be only slightly above the amount for the exemption for proficiency of English to apply”.[5]

   b)The first applicant’s most recent position was as a marketing specialist for a standard business sponsor on a salary of $70,000.[6]

   c)The average median full-time weekly earnings of advertising and sales managers are significantly lower than the earnings required to come within the Class 2 Exemption.[7] The Tribunal referred to Australian government statistics that showed that the average median full-time weekly earnings of advertising and marketing managers were $1,562, which equates to an annual salary of $82,000.[8]

   d)According to its payroll activity records, from 1 July 2013 to 30 June 2014 the Nominator paid a total of $213,680.21 in wages for eleven employees, and the highest salary paid to an employee during that period amounted to $40,635.[9] The Tribunal considered the salary offered to the first applicant “to be unrealistic given the total wages paid by the nominating business in recent years”.[10]

   [3] CB151, [17]

   [4] CB151, [18]

   [5] CB151, [17]

   [6] CB151, [17]

   [7] CB151, [19]

   [8] CB151, [20]

   [9] CB152, [22]

   [10] CB152, [23]

2. The Tribunal stated its ultimate conclusions as follows (emphasis added):[11]

   …the Tribunal is not convinced that the [first] applicant will be paid $182,000 as a salary. Rather, it considers that the salary offered was in an attempt to overcome the issue that the [first] applicant did not meet the competent English definition, which is the required level of English language proficiency for the Subclass 186 visa under the Direct Entry stream. It thus does not accept that the [first] applicant’s earnings will be at least equivalent to the current Australian Tax Office top individual income tax rate, and finds that the [first] applicant is not in Class 2 for the purposes of cl.186.232(b).

   [11] CB152, [25]

Grounds of application

1. The applicants rely on three grounds of application.

Ground 1 - irrationality

1. The first ground is that the Tribunal’s reasoning in the passage I have set out in paragraph 9 of these reasons (relevant passage) is irrational and based on irrelevant considerations. This ground, to the extent it claims the Tribunal’s reasoning is irrational, is based on the following two premises:

   a)The second emphasised portion of the relevant passage is based, and based only, on the first emphasised portion of the relevant passage.

   b)The first emphasised portion of the relevant passage cannot logically imply the second emphasised portion of the relevant passage; on the contrary, the first emphasised portion of the relevant passage supports the proposition that the first applicant’s earnings will be at least equivalent to $180,001

2. Implicit in these premises is the contention that the Tribunal found or assumed that the Nominator genuinely intended to pay the first applicant a salary of $182,000; and the applicants indeed submit that, on the proper construction of its reasons, the Tribunal did so find. The applicants rely on the following matters:

   a)By acknowledging “that the parties wish to engage in a business opportunity together”,[12] the Tribunal implicitly found the Nominator wanted to employ the first applicant.[13]

   b)The Tribunal found that the Nominator believed the first applicant would “contribute to the growth and expansion of the business” of the Nominator.[14]

   c)The Tribunal found the Nominator had “aspirations to expand”.[15]

   d)The Tribunal did not find the Nominator could not afford to pay the first applicant a salary of $182,000; on the contrary, the Tribunal appears to have implicitly accepted evidence from the Nominator’s external accountant “that the business would be able to pay the salary offered”.[16]

   e)The Tribunal did not find there was a “side-agreement” between the Nominator and the first applicant that the first applicant would be paid an amount lower than that stated in the Employment Contract.[17]

   f)The Tribunal did not make any adverse credibility findings against the Nominator or the first applicant.[18]

   [12] CB151, [19]

   [13] Outline of Submission for Applicant for Hearing on 25 October 2016, [22(a)]

   [14] Outline of Submission for Applicant for Hearing on 25 October 2016, [22(b)] quoting from CB151, [19]

   [15] Outline of Submission for Applicant for Hearing on 25 October 2016, [22(c)] quoting from CB151, [19]

   [16] Outline of Submission for Applicant for Hearing on 25 October 2016, [22(d)] quoting from CB152, [22]

   [17] Outline of Submission for Applicant for Hearing on 25 October 2016, [22(e)]

   [18] Outline of Submission for Applicant for Hearing on 25 October 2016, [22(f)]

3. The Minister, on the other hand, accepts that the first emphasised portion in the relevant passage was a reason for the Tribunal’s not accepting that the first applicant’s earnings would be at least equivalent to the current Australian Tax Office top individual income tax rate, and that the first applicant does not fall in the Class 2 Exemption for the purposes of cl.186.232(b) of Schedule 2 to the Regulations. The Minister submits, however, that this was not the only reason on which the Tribunal relied; the Tribunal’s conclusion was based on all of the material before it.

4. It may be accepted that if, as the applicants submit, the Tribunal found the Nominator did intend and was willing to pay the $182,000 salary specified in the Employment Contract, the Tribunal reasoned irrationally by relying on this finding not to accept that the first applicant’s earnings will be at least equivalent to the current Australian Tax Office top individual income tax rate.  The Tribunal will in these circumstances have contradicted itself. In my opinion, however, the applicants’ submissions ignore or at least give insufficient weight to the other passages from the Tribunal’s reasons; and the applicants draw unwarranted inferences from passages from the Tribunal’s reasons.

5. I first turn to the passages of the Tribunal’s reasons the applicants ignore or to which they give insufficient weight. First, there is the statement that immediately precedes the first emphasised portion of the relevant passage that conveys the Tribunal’s finding that it was not convinced the first applicant would be paid $182,000 as a salary. In that context the first emphasised portion of the relevant passage serves to explain why, given the Tribunal was not convinced the first applicant would be paid the $182,000 salary, the Nominator and first applicant nevertheless entered into the Employment Contract; and that explanation is that it was a means of overcoming the first applicant’s not being able to show he had competent English.[19]

   [19] The Tribunal found the first applicant did not have competent English – see CB152, [26]

6. Next, there are statements the Tribunal made about the genuineness of $182,000 salary and the ability of the Nominator to pay such a salary. The Tribunal said it had concerns whether the $182,000 salary “is a genuine figure”.[20] It said it raised these concerns with the first applicant and noted that the first applicant’s most recent position was a marketing specialist for a standard business sponsor on a salary of $70,000. After acknowledging the Nominator proposed to employ the first applicant at a higher level position with greater responsibilities than that which the first applicant held in his previous position, the Tribunal said it “remained concerned as to whether the salary is a genuine amount that would be paid”.[21] The Tribunal also said it had “significant doubts about the amount of salary to be paid” to the first applicant, given the evidence that was before the Tribunal indicated that the average full-time median weekly earning of advertising and sales managers equated to an annual salary of $82,000.[22] Finally, the Tribunal referred to the salary stated in the Employment Contract to be “unrealistic given the total wages paid by the nominating business in recent years”.[23]

   [20] CB151, [17]

   [21] CB151, [18]

   [22] CB151, [19], [20]

   [23] CB152, [22]

7. As to the passages from the Tribunal’s reasons on which the applicants rely,[24] it may be accepted the Tribunal acknowledged the first applicant and the Nominator wished to engage in a business opportunity together, that the Nominator believed the first applicant would contribute to the growth and expansion of the Nominator’s business, and that the Nominator aspired to expand its business. These matters, however, go no further than supporting a finding that the Nominator and first applicant desired to enter into a contract of employment. By themselves, they are not reasonably capable of establishing that the Nominator genuinely agreed or was willing or able to pay to the first applicant a salary of $182,000.

   [24] CB151-152, [19]-[22]

8. I do not accept that the Tribunal’s referring to the Nominator’s external accountant’s “opinion that the business would be able to pay the salary offered” constitutes an implicit finding that the Nominator’s business would be able to pay the salary stated in the Employment Contract. The Tribunal referred to the Nominator’s external accountant’s opinion for the purpose of assessing its weight in light of the total wages the Nominator had paid in 2012, 2013, and 2014, and the highest wage the Nominator had paid between 1 July 2013 to 30 June 2014, was $40,635.[25] In that context, and taking into into account the claimed reduction in expenses that the first applicant’s employment would hope to achieve for the Nominator, the Tribunal concluded it considered “the salary offered to be unrealistic given the total wages paid by the nominating business in recent years”.[26]  The meaning the Tribunal attached to “unrealistic” is to be inferred from the context in which the word appears, namely, in a conclusion to a section in which the Tribunal said it had to consider “whether the [first] applicant will in fact be paid $182,000”.[27] On a fair reading of this part of its reasons,  the Tribunal’s conclusion that it considered “the salary offered to be unrealistic” is a conclusion to the effect that the Tribunal was not satisfied the Nominator would be able to pay the salary of $182,000.

   [25] CB152, [22]

   [26] CB152, [23]

   [27] CB152, [22]

9. That conclusion was reasonably open to the Tribunal, even if it is assumed the Tribunal relied only on the wages the Nominator had paid to which the Tribunal referred in its reasons. But there is nothing to suggest the Tribunal was unaware of the other information contained in the financial report prepared by the Nominator’s external accountant.[28] The Nominator’s profit and loss statement showed the Nominator made a profit before tax of $23,143 for 2013 and a profit before tax of $13,629 for 2012. In light of these matters, it is not possible to conclude the Tribunal implicitly found the Nominator’s business would be able to pay the first applicant a salary of $182,000.

   [28] CB105-115

10. I return, then, to the first emphasised portion of the relevant passage, which must be read in the context of the Tribunal’s reasons as a whole. In particular, it must be read with those parts of the reasons to which I have referred in paragraphs 15 and 16 of these reasons. In that context, the Tribunal’s statement should be read as being to the effect that the Nominator offered a salary it was either unwilling or unable to pay; and that the Nominator offered that salary to overcome the first applicant’s inability to meet the definition of “competent English” as defined in reg.1.15C of the Regulations. So read, the statement conveyed by the first emphasised portion of the relevant passage logically supports the statement conveyed by the second emphasised portion of the relevant passage.

11. There is one final matter to address, and that is the applicants’ submission that the Tribunal made no adverse credibility findings against the first applicant or the Nominator, and that it did not find there was a “side agreement” between the Nominator and the first applicant that the first applicant would be paid an amount lower than that stated in the Employment Contract. That submission implies that it was necessary for the Tribunal to make such findings before it could conclude it was not satisfied the Nominator was unwilling or unable to pay the $182,000 salary. Such an implication is incorrect. The question the Tribunal was required to consider is whether, on the material before it, it was satisfied that the Nominator was willing and able to pay the first applicant a salary of $182,000. It was open to the Tribunal not to be satisfied of these matters for reasons that did not involve a positive finding of dishonesty or of the existence of a side agreement.

12. Ground 1 fails, therefore, to the extent it relies on irrationality.

Ground 1 – taking into account irrelevant consideration

1. Ground 1 also claims the Tribunal took into account an irrelevant consideration. That consideration is said to be the first emphasised portion of the relevant passage. The applicants submit the first emphasised portion of the relevant passage is irrelevant for the same reasons they submit it did not logically support the second emphasised portion of the relevant passage. Given I have found that the statement contained in the first emphasised portion of the relevant passage logically supports the statement contained in the second emphasised portion of the relevant passage, this part of ground 1 also fails.

2. I should note that in their written submissions, the applicants submit the Tribunal failed to take into account a relevant consideration, namely “the willingness of the nominator to pay a salary of $182,000”.[29] That submission assumes the Tribunal found the Nominator was willing to pay the first applicant a salary of $182,000. For reasons I have given, the Tribunal’s reasons cannot reasonably be read as containing any such finding.

   [29] Outline of Submission for Applicant for Hearing on 25 October 2016, [34]

Ground 2 – failing to take into account legal enforceability of Employment Contract

1. By their second ground of application the applicants claim that, in the absence of a finding that the Employment Contract was not genuine, the Tribunal ought to have considered, but failed to consider, that the Employment Contract was legally enforceable, and that it was open to the first applicant to enforce the Employment Contract against the Nominator by action.

2. The applicants submitted that, although the Tribunal referred to the Employment Contract, it did not genuinely consider it. The applicants relied on the judgment of Madgwick J in NAJT v Minister for Immigration and Multicultural and Indigenous Affairs.[30] One issue in NAJT was whether a delegate of the Minister had regard to a letter written by the appellant in circumstances where the delegate “at no point gave any reason for depreciating” the appellant’s evidence.[31] Madgwick J, with whose reasons Conti J agreed, said the delegate did not have regard to the appellant’s evidence. The applicants in the case before me particularly rely on the following passage from Madgwick J’s judgment:[32]

   A decision-maker cannot be said to ‘have regard’ to all of the information to hand, when he or she is under a statutory obligation to do so, without at least really and genuinely giving it consideration. As Sackville J noticed in Singh v Minister for Immigration & Multicultural Affairs [2001] FCA 389; 109 FCR 152 at [58], a ‘decision-maker may be aware of information without paying any attention to it or giving it any consideration’. In my opinion, it would be very surprising if the delegate had genuinely paid attention to the letter and given it genuine consideration – had in Black CJ’s phrase in Tickner v Chapman [1995] FCA 1726; (1995) 57 FCR 451 at 462 engaged in ‘an active intellectual process’ in relation to the letter – yet remained silent about such consideration in the reasons he gave. I am satisfied he did not do so.

   [30] [2005] FCAFC 134, Conti J agreeing

   [31] [2005] FCAFC 134 at [117]

   [32] [2005] FCAFC 134 at [212]

3. The applicants submit the Tribunal in the case before me did not engage in “an active intellectual process” in relation to the enforceability of the Employment Contract. The Minister, on the other hand, submits the Tribunal considered the genuineness of the Employment Contract.

4. There are three difficulties with ground 2.

   a)First, it assumes that by not making a positive finding that the Employment Contract was a sham the Tribunal necessarily accepted the Employment Contract was genuine. That is not correct. There were three possible attitudes the Tribunal could have adopted towards the Employment Contract. One was a positive satisfaction it was genuine; another was a positive satisfaction it was a sham; and the third was the absence of satisfaction the Employment Contract was genuine. That the Tribunal made no positive finding that the Employment Contract was a sham, therefore, does not imply it was satisfied it was genuine.

   b)Second, the Tribunal actively considered whether it should be satisfied the Employment Contract was genuine. It referred to the Employment Contract but noted “this alone is not sufficient to establish that [the first applicant] would be paid that amount in this case”.[33] The Tribunal then considered matters that were relevant to whether the first applicant would be paid a salary of $182,000 as referred to in the Employment Contract. These included whether the amount could be regarded as genuine, given the first applicant’s having previously been employed for a salary of $70,000, the average median full-time earning of advertising and sales managers as revealed by Australian government statistics, and the amounts the Nominator paid in wages during 2012, 2013, and 2014. It was after it considered those matters that the Tribunal concluded it was not satisfied the Nominator was willing or able to pay the $182,000 stipulated in the Employment Contract.

   c)Third, even if it could be said the Tribunal was satisfied the Nominator genuinely believed it would pay the $182,000 provided for in the Employment Contract, the Tribunal nevertheless considered whether the Nominator would be able to pay this amount, given the amounts the Nominator paid for wages during 2012, 2013, and 2014.

   [33] CB150, [16]

5. For each of these reasons, therefore, ground 2 fails.

Ground 3 – failure to have regard to evidence

1. In the third ground of application the applicants claim the Tribunal failed to have regard to a number of aspects of statements given by Ms Gao, the principal of the Nominator. The applicants submit[34] that in two statements, one dated 29 September 2014,[35] and the other dated 7 January 2015,[36] Ms Gao is said to have given at least five reasons in support of the Nominator’s willingness to employ the first applicant at an annual salary of $182,000. These reasons are said to have been as follows:

   a)Employing the first applicant would “help us saving our expenditures on sales & marketing management ($1.2 million)” in China.[37]

   b)The first applicant’s ability to make “unlimited contribution [sic] by making more connections with our partners and clients”[38] and his having “enormous network connections” which would expand “our client groups and making our business even more famous”.[39]

   c)The first applicant’s experience and skills based on past performance, including “strong sales and marketing abilities” and “superior management skills”.[40]

   d)The first applicant’s “previous experience could be extremely beneficial in training his subordinate employees”.[41]

   e)The first applicant has a “deep understanding of cosmetic and health care products”.[42]

   [34] [34] Outline of Submission for Applicant for Hearing on 25 October 2016, [39]

   [35] CB30-33

   [36] CB126-128

   [37] CB126.6

   [38] CB126.8

   [39] CB127.9

   [40] CB126.10-127.1

   [41] CB127.3

   [42] CB127.6

2. The applicants submit that in its reasons for decision the Tribunal only referred to matters (a) and (e) but not to the other matters[43] and therefore, it should be inferred the Tribunal did not consider those reasons.

   [43] Outline of Submission for Applicant for Hearing on 25 October 2016, [40]

3. This ground relies on an artificial reconstruction of the reasons Ms Gao gave for claiming the Nominator was willing to pay the first applicant a salary of $182,000. In her statement dated 7 January 2015 Mr Gao stated “there are two main reasons”, not the five the applicants identify, for wishing to hire the first applicant “with such a high rate”.[44] The first reason was that the first applicant would help the nominator save their “expenditures on sales & marketing management ($1.2 million) in china [sic] with his tremendous well working experience”.[45] The second, and “primary reason”, was that “we would like to employ [the first applicant] . . . because he has extensive working performances [sic]”.[46] Ms Gao then identified what she claimed was the first applicant’s work experience, which she stated was in cosmetics and healthcare, and stated how that work experience would assist the Nominator.

   [44] CB126.2

   [45] CB126.7

   [46] CB126.9

4. The Tribunal correctly identified that Ms Gao relied on two reasons to support the asserted willingness of the Nominator to employ the first respondent for a salary of $182,000. The first was Ms Gao’s referring to the first applicant “as being a suitable business partner for these expansion plans, given his experience with cosmetics and beauty products in the Chinese market”.[47] The second reason the Tribunal identified was Ms Gao stating that the “high salary level offered can be justified by the savings expected to be generated through employing” the first applicant.[48] Given the Tribunal correctly identified the two main reasons Ms Gao herself identified in her statement of 7 January 2015, it is reasonable to infer, and I do infer, that the Tribunal also considered the subordinate reasons on which Ms Gao relied to claim that the first applicant’s work experience justified the Nominator’s willingness to pay the first applicant a salary of $182,000. That includes each of the five reasons the applicants submit the Tribunal did not consider.

   [47] CB151, [19]

   [48] CB151, [19]

5. Ground 3, therefore, also fails.

Conclusion and disposition

1. The applicants have not succeeded on any of the grounds set out in the amended application. I propose, therefore, to order that the application be dismissed.

I certify that the preceding thirty-five (35) paragraphs are a true copy of the reasons for judgment of Judge Manousaridis

Date: 1 December 2017