Universal Education Group Limited t/a New Zealand National College 2008 v New Zealand Qualifications Authority
[2017] NZHC 3245
•19 December 2017
IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY
I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-Ā-TARA ROHE
CIV-2017-485-835 [2017] NZHC 3245
UNDER Judicial Review Procedure Act 2016 BETWEEN
UNIVERSAL EDUCATION GROUP LIMITED TRADING AS NEW ZEALAND NATIONAL COLLEGE 2008
Applicant
AND
NEW ZEALAND QUALIFICATIONS AUTHORITY
Respondent
Hearing: 4 and 5 December 2017 Counsel:
N J Russell, M J Matthews and S B McCusker for Applicant
R J Scott and M Cavanaugh for RespondentJudgment:
19 December 2017
JUDGMENT OF CHURCHMAN J
Introduction
[1] The issue before the Court is how the New Zealand Qualifications Authority (NZQA, the Authority) went about making the decision to cancel the applicant’s registration as a Private Training Establishment on 14 November 2017. The applicant has brought judicial review proceedings in respect of the decision to cancel on the grounds of illegality, pre-determination, and unreasonableness.
Factual background
[2] The applicant is Universal Education Group Limited trading as New Zealand
National College 2008 (NZNC, the applicant). The applicant operates as a Private
UNIVERSAL EDUCATION GROUP LIMITED TRADING AS NEW ZEALAND NATIONAL COLLEGE
2008 v NEW ZEALAND QUALIFICATIONS AUTHORITY [2017] NZHC 3245 [19 December 2017]
Training Establishment (PTE) registered and regulated under Part 18 of the Education Act 1989 (the Act). Mr Evan Wu is the managing director of the applicant and provided a large amount of affidavit evidence in relation to this proceeding.
[3] The respondent is NZQA, a statutory body and Crown entity established under Part 20 of the Act. The Authority’s statutory functions include registering PTEs, overseeing the setting of standards for qualifications, and ensuring national consistency in assessment and moderation procedures.1 NZQA’s role in the education sector is to ensure that New Zealand qualifications are regarded as credible and robust, nationally and internationally, in order to help learners succeed in their chosen endeavours and to contribute to New Zealand society.2
[4] The applicant was registered as a PTE on 21 May 2009. Prior to May 2017, NZNC had approval and accreditation to provide the following programmes and training schemes, comprising five business-related diplomas, one university preparation training scheme and at least 4 English-language related courses:
(a) National Diplomas in Business (Levels 5 and 6) (the National
Diplomas) which NZNC was accredited for in June 2014;
(b) Preparation for University Study (Level 3) (the Uniprep scheme) which
NZNC was accredited for in July 2015;
(c) Diploma in Business (Level 7) (the Level 7 Diploma) which NZNC
was accredited for in December 2015;
(d)New Zealand Diplomas in Business (Leadership and Management) (Levels 5 and 6) (the New Zealand Diplomas) which NZNC was accredited for in August 2016;
(e) General English (Levels 2 and 3);
1 Education Act 1989, ss 232C and 246A.
2 Affidavit of Evan Wu, 21 November 2017, at 419.
(f) Certificate in Advanced English Language (academic) (Level 4); and
(g) IELTS Preparation (Level 4).
[5] NZNC’s rating for the purpose of the quality assurance system was Category
2. This means NZQA had provided statements in the most recent published External
Evaluation and Review (EER) of NZNC that it was:3
highly confident in [the] organisational capability in self-assessment and confident in educational performance … or confident in educational performance and confident in organisational capability in self-assessment …
[6] In accordance with this categorisation, NZNC was obliged to have an EER every four years. NZQA alerted NZNC on 2 February 2017 that its four-yearly EER would take place starting 25 September 2017. Arrangements were made between February and September to facilitate this review.
[7] On 13 March 2017 NZQA published on its website a letter to Mr Wu outlining the applicant’s final National External Moderation Results (NEMR) for 2016, which were found to be unsatisfactory in relation to the National and New Zealand Diplomas. Mr Wu’s evidence is that he did not receive this letter.
[8] On 30 March NZQA sent an external monitor to NZNC’s premises to assess
NZNC’s performance in relation to its Diploma in Business, namely the Level 7
Diploma programme.
Inspection and compliance notices
[9] On 12 May NZQA performed an unannounced inspection of NZNC premises. It issued a compliance notice under s 255 of the Act (the first compliance notice). The
grounds for its issue were that:
3 Quality Assurance (including External Evaluation and Review (EER)) Rules 2016 [the EER Rules], r 11.1(b).
(a) in respect of the National Diplomas NZNC had demonstrated a failure to meet the national external moderation requirements in both 2015 and
2016;
(b) of 51 National Diploma learner samples provided for moderation in
2016, the NZQA moderator verified only ten of NZNC’s assessment decisions;
(c) these results indicated that NZNC was failing to comply with the NZQF Programme Approval and Accreditation Rules 2013 (the Accreditation Rules) requiring assessment materials and decisions are fair, valid, consistent and appropriate given the stated learning outcomes.
[10] NZQA required, pursuant to the notice, that NZNC:
(a) stop enrolling students into the National and New Zealand Diplomas;
(b) cease issuing offers of place to students for enrolment into both the
National and New Zealand Diploma programmes;
(c) not commence delivery of the National and New Zealand Diplomas to students who are enrolled but have not yet begun their studies;
(d) appoint an assessment partner for the National and New Zealand
Diplomas; and
(e) meet all assessment partner and NZQA costs in external moderation and ongoing programme monitoring.
[11] NZNC wrote to NZQA on 15 May 2017 requesting that the New Zealand Diplomas not be included in the first compliance notice, as there was no probative evidence for their inclusion.
[12] NZQA revoked the restrictions in relation to the New Zealand Diplomas on
16 May 2017, but issued a further compliance notice (the second compliance notice)
based on the evidence it had collected on 12 May 2017, which set out restrictions in relation to the New Zealand Diplomas that NZNC must:
(a) cease issuing offers of place to students for enrolment into the
New Zealand Diploma programmes;
(b) stop enrolling students into the New Zealand Diplomas;
(c) not commence delivery of the New Zealand Diplomas to students who are enrolled but have not yet begun their studies; and
(d) meet NZQA’s costs in carrying out external moderation.
[13] The grounds for the second compliance notice included:
(a) While the poor NEMRs related to the National Diplomas, the results raised significant and parallel concerns about the similar New Zealand Diploma programme.
(b)There were concerns about the applicant’s record keeping systems and whether it was able to comply with the PTE Enrolment and Academic Rules 2012 (the Records Rules).
(c) There were performance concerns relating to the applicant’s assessors under r 6.1 of the Accreditation Rules.
[14] On 17 May NZNC informed NZQA of its intention to withdraw the New Zealand and National Diploma programmes voluntarily. The programmes were withdrawn on 22 May and NZQA declared a Course Closure Event for the purposes of the Student Fee Protection Rules 2013. The students enrolled were transferred to another PTE or returned to their country of origin.
[15] On 7 June NZQA performed another unannounced visit and removed assessment and moderation materials relating to the Uniprep scheme.
[16] On 18 June, unprompted, NZNC sent a one-page improvement plan to NZQA in relation to the Level 7 Diploma which a moderation report was being formulated for in light of the 30 March visit.
Re-categorisation procedure
[17] Categorisation of PTEs is regulated by rule 11 of the EER Rules. On 3 July
2017 NZQA issued a notice to NZNC stating it intended to change the categorisation of NZNC from Category 2 to “category withdrawn” (the re-categorisation notice). The grounds for this were the first and second compliance notices, and the declaration of a Course Closure Event. NZNC was invited to make submissions on its categorisation.
[18] On 20 July NZQA issued a final moderation report in relation to the Level 7
Diploma and the information gathered in the 30 March inspection. The facts underpinning this report had been reviewed by, and accepted as accurate by Mr Wu on or around 13 July 2017.
[19] In the report NZQA had found of the 40 pieces submitted for moderation which had been marked as pass by NZNC, 21 (53 per cent) ought to have been marked as a fail. NZNC had not disputed the moderation findings, instead making submissions on
18 June and 13 July as to the proposed improvements it was making in organisational structure, governance, and moderation pre and post-assessment. The 20 July report set out 27 recommendations for NZNC’s improvement, including more rigorous moderation practices and stricter plagiarism policies.
[20] On 21 July NZNC provided submissions to NZQA on the re-categorisation notice. NZNC submitted that:
(a) The National Diplomas, which were the primary area of concern constituted only 20 per cent NZNC’s delivery, which was not a sufficient quantity to warrant re-categorisation.
(b) NZNC had voluntarily discontinued the New Zealand and National
Diploma programmes.
(c) There was no probative evidence of significant non-compliance in relation to capability and capacity in assessment, as was alleged by NZQA.
(d)NZNC had adopted an extensive improvement plan to comply with the two compliance notices.
(e) NZQA had failed to accord NZNC natural justice in its decision- making process.
[21] It appears NZQA drafted a response to these submissions but did not release the final response until the 14 November cancellation decision.
[22] The EER had been set down in February 2017 to take place starting the week of 25 September 2017. Between February and September 2017 meetings were held between the parties, and arrangements were made on the basis that the EER would progress as planned.
Uniprep scheme moderation issues
[23] On 20 September NZQA issued a final moderation report in relation to the Uniprep materials collected on 7 June 2017, having issued a draft and received and considered submissions from NZNC. The moderation report found:
(a) of the 63 passed samples moderated the NZQA moderation agreed with the assigned pass grade in 36 (57 percent) of the samples;
(b)in the other 27 samples the moderators disagreed with the grade given, namely that:
(i)19 passed samples ought to have been given a fail grade (30 per cent); and
(ii)in the remaining eight samples the student should have received a different pass grade to that given.
[24] Overall issues identified in the Uniprep training scheme moderation included examples of plagiarism, use of synonym replacement software and students having multiple attempts at an assessment. Together NZQA held that this undermined the credibility of the credits being awarded to the significant number of students enrolled in the scheme. NZQA advised NZNC in the cover letter to the report that it was considering its options and what actions may be necessary in response.
[25] On 22 September 2017 NZQA informed NZNC via email that the EER set down for the following Monday had been postponed pending possible statutory action.
The proposed cancellation
[26] On 3 October NZQA advised NZNC that it was considering cancelling NZNC’s registration as a PTE under s 233D(1)(a)(ii) of the Act (the proposed cancellation). The grounds for the proposed cancellation were that NZNC had failed to comply with assessment and moderation requirements in relation to all of its non- English programmes and training schemes, being:
(a) the National and New Zealand Diplomas (Levels 5 and 6);
(b) the Level 7 Diploma; and
(c) the Uniprep scheme.
[27] The notice requested that NZNC provide any submissions in opposition to the notice by 24 October.
[28] On 4 October NZNC wrote to NZQA advising that the proposed cancellation was unlawful. Also on 4 October NZQA informed NZNC that it had placed its decision about NZNC’s categorisation on hold, in light of further concerns raised by the moderation results of the Uniprep scheme finalised on 20 September 2017 and the pending statutory action.
[29] Since May 2017 there was a secondary issue between the parties as to whether and how much NZNC was required to contribute towards the cost of transitioning its
students to the alternate provider chosen by NZQA, New Zealand Management Academies Ltd (NZMA). NZNC disputed that there was any statutory duty requiring it to pay the costs of enrolling or re-enrolling students with NZMA, which NZQA ultimately acknowledged on 4 October 2017.
[30] Between 5 and 10 October there was a further dispute between the parties as to whether r 5.1.4(c) of the Private Training Establishment Rules 2013 (PTE Rules) applied. The rule requires the PTE to notify its students of the existence of the proposed cancellation. NZQA refused to suspend the operation of the rule, and required NZNC to notify its students by 13 October.
[31] On 13 October NZNC filed proceedings in judicial review and made an urgent application for interim relief, namely:
(a) a declaration that NZQA would not take any further action pursuant to the proposed cancellation dated 3 October; and
(b)a declaration that r 5.1.4(c) of the PTE Rules did not apply in the circumstances and that NZNC was not required to inform its students of the proposed cancellation.
[32] The interim hearing was heard on 20 October. Simon France J refused to make the declarations sought on 20 October 2017.
[33] NZNC notified its students of the proposed cancellation on 24 October 2017. On 24 October 2017, being the final day for submissions to be received, NZNC made further written submissions to NZQA as to why it should not proceed with the proposed cancellation.
[34] The specific programmes and training scheme assessment materials forming the basis for the proposed cancellation were the National, New Zealand and Level 7
Diploma programme results from 2016 and the Uniprep scheme results from Term one and two of 2017. The thrust of NZNC’s submission in response were that in Term three of 2017 it had made comprehensive and wide-spread changes and
improvements to its academic governance and management, as well as its assessment and moderation processes, including those to specifically designed to combat plagiarism, which it set out in detail in its submissions.
[35] At the end of the 24 October submissions NZNC advised that it was confident that the moderated Term three results for the Level 7 Diploma and the Uniprep scheme would demonstrate to NZQA the reality and quality of these improvements. It would therefore be providing copies of all those assessments to NZQA for NZQA’s moderation and further assessment.
[36] On 1 November NZNC advised NZQA that all the Level 7 Diplomas had been marked and internally moderated and that NZNC was awaiting external moderation. Most of the Uniprep assessments were at a similar stage and available in electronic form. NZNC asked NZQA if and how it would like to receive this material.
[37] On 3 November, unprompted, NZNC provided NZQA with a sample of some of the Level 7 Diploma assessments for NZQA’s moderation. External moderation had not yet been completed. This raw assessment material, being some 360 pages, was provided for the Court as an exhibit to Mr Wu’s second affidavit dated
21 November 2017.
The cancellation decision
[38] On 14 November 2017 NZQA wrote to NZNC advising that the decision had been made to cancel its registration, and the reasons for that decision. The decision set out the background to the decision, including the two May compliance notices, the consequent course closure event, the aborted re-categorisation process begun in July
2017, the 21 July submissions in response, the Level 7 Diploma moderation results of
20 July, the Uniprep moderation results of 20 September, the postponed EER, the meeting between NZNC and NZQA on 5 October, and NZNC’s 24 October submissions.
[39] In its cover letter NZQA said that it was:
Satisfied on reasonable grounds that NZNC has not complied with one or more of the conditions of its registration as a PTE, being compliance with the rules made under s 253 of the Act.
[40] The specific rules which NZNC were said to have breached were:
… Criterion 1 of r 6.1 of the [NZQF Programme] Approval and Accreditation Rules [2013], which requires that the institution has the capability and capacity to ensure assessment materials and decisions are fair, valid, consistent and appropriate for the level, given the stated learning outcomes in relation to the New Zealand and National Diploma programmes and the Level
7 Diploma;
Criterion 5 of r 4.1 of the Training Scheme Rules [2012], which requires that an institution’s assessment methodologies provide fair, valid, consistent and appropriate assessment of student achievement, given the stated learning outcomes, and that there is an effective system for moderation of assessment materials and decisions, in relation to the [Uniprep] training scheme;
Rule 5.1.8(a) of the [PTE] Registration Rules [2013] which requires a PTE to operate a coherent system to ensure assessment and moderation requirements are met across all programmes for which it has accreditation, across all its approved training schemes and across all of its consents to assess.
[41] NZQA set out a comprehensive response to NZNC’s submissions of 21 July and 24 October. The reasons for not accepting NZNC’s submissions included:
NZQA is not persuaded that these steps and improvements (assuming they have taken place) are sufficient to outweigh the serious breaches of the Rules that have occurred…
NZQA cannot be confident in NZNC’s commitment to sustaining any improvements it may have effected, or its long term capability to do so. …
NZQA notes that NZNC’s awareness of the need for improvements came about “as a result” of NZQA’s moderation activities, rather than as a result of undertaking “effective and ongoing self-assessment” as required by Rule
5.1.9(a) of the Registration Rules. … NZNC’s recognition and acceptance of the need for improvements to its assessment and moderation practices came
neither soon enough, nor as a result of effective self-assessment.
NZQA will not conduct any further moderation of the applicant’s assessments and would not consider the 360 pages of sample assessments provided on 3
November as to do so would “introduce further delays and is unreasonable”.
On 22 May 2017 [the later discontinued National and New Zealand Diplomas] constituted 42.9 per cent of NZNC’s delivery, as measured by student visa numbers. … When the Level 7 Diploma monitoring report and Uniprep scheme moderation results were finalised on 20 July and 20 September respectively, it became clear to NZQA that the proportion of NZNC’s delivery affected by non-compliance was even greater … specifically, 737 of the 1014
students with student visas as a 22 May 2017 (72.7 per cent) were enrolled in programmes for which there was evidence of non-compliance.
NZQA’s moderation of NZNC student assessments across the National Diplomas, New Zealand Diplomas, Level 7 Diploma and Uniprep scheme had evidenced a systemic problem with NZNC’s assessment and moderation practices.
[42] The cancellation was to become effective from 22 November 2017, however, given these proceedings the cancellation remains inoperative until a determination is made by this Court. As at the date of hearing the applicant remains a registered and operating PTE with approximately 430 students enrolled in various courses. Mr Wu has been unable to sell the applicant entity to interested third parties, alleging this is because NZQA will not let it. However the most recent attempted sale appears to have failed because the prospective purchaser was not keen to purchase the business when NZQA would require an independent third party to undertake some of the aspects of the necessary student transfers.
[43] The applicant seeks declarations that the decision made on 14 November 2017 was unlawful, an order setting aside the decision, as well as costs of and incidental to the proceeding.
Submissions
[44] Mr Russell for the applicant submitted on three grounds of review: illegality, predetermination and unreasonableness. Of the three, claims of illegality in the decision to cancel the applicant’s registration formed the bulk of the applicant’s written and oral submissions.
Illegality
[45] The applicant submits the following errors form the basis of a finding the decision made was illegal, namely due to failure to take relevant considerations into account, the taking of irrelevant considerations into account, and the breach of NZNC’s legitimate expectation an EER would take place. As in most judicial review proceedings, there is an overlap in the grounds of error pleaded. The six specific incidents claimed to form the basis of review on the grounds of illegality I summarise, along with the applicant’s submissions, as follows:
[46] Firstly, NZNC had voluntarily ceased providing the National and New Zealand Diplomas in May 2017. NZQA taking into account the failures of these Diploma programmes to comply with moderation and assessment requirements was:
(a) taking into account an irrelevant consideration, as without regard for these historical breaches NZQA would likely not have felt cancellation was the only appropriate remedy. The applicant’s voluntary withdrawal of the programmes should have comprehensively addressed the respondent’s concerns;
(b)based on a material error of fact (evidence around moderation of programmes no longer provided was irrelevant); and
(c) an factor from which the inference can be drawn that the decision was pre-determined.
[47] Secondly NZNC had made significant improvements in its delivery of programmes and that at the time of cancellation there were no new issues with its performance which NZQA could identify. NZQA failed to take into account this mandatory relevant consideration, on the basis that to review the moderated Term Three material would introduce “delays and is unreasonable”. The respondent further concluded that the improvements made by NZNC “did not come soon enough” and were not “sustainable”. No timetable for improvements had been established by NZQA, nor was there any basis for finding that the improvements were unsustainable. This forms a reviewable error.
(a) Further to this, the applicant submitted that recent improvements are not just a permissible consideration, they are a mandatory consideration. The basis for this submission was that, in the absence of statutory guidance as to what the mandatory considerations are, the decision-maker should have regard to the interests of students, here, ensuring students can be confident in their PTEs, and further confident that their PTEs registration will only be cancelled where there is strong basis to do so. Current performance is thus an important consideration.
If historical breaches were able to result in cancellation this would cause great uncertainty.
(b)The case is similar to Nottingham v The Real Estates Agents’ Authority where, after judicial review, and on further appeal, the Authority was required to make the decision again and take into account further witness statements which directly contradicted the key evidence at issue and had been filed unsworn after the hearing concluded. 4 This refusal to consider highly relevant evidence was held to be a failure to take a relevant consideration into account warranting successful review.
(c) The case in not similar but should take guidance from Haji v Minister of Immigration where the Minister making the decision had indicated he would not make a final decision until an Amnesty International Report was filed.5 Before it was able to be filed the Minister made the decision to deport the applicant. The court held in an interim oral ruling that the expressed willingness of the Minister to wait a time for the report indicates it was a relevant consideration. In this case NZQA was obliged to consider NZNC’s submissions and didn’t expressly state it wouldn’t consider further moderation materials. If the Court accepts this was a mandatory consideration then the applicant invites the Court to infer that the respondent acted with a closed mind.
(d)This lack of consideration forms part of the claim that the decision was pre-determined. A PTE which has had historical issues with its performance should be given a reasonable opportunity to demonstrate that it has rectified those concerns.
[48] Thirdly that NZNC had no statutory duty to pay the alternate provider costs. NZQA taking this failure to pay into account was taking into account an irrelevant
consideration. While there is no evidence to support this, the Court is invited to infer,
4 Nottingham v The Real Estate Agents’ Authority [2017] NZCA 1.
5 Haji v Minister of Immigration HC Auckland CIV-2003-404-7044, 12 November 2003.
based on the timing of NZNC’s refusal and the proposed cancellation, that this factor was a consideration for NZQA.
[49] Fourthly, the NZQA report on the Uniprep scheme stated there was “a concerning proportion of students being wrongly assessed” without setting out the standard or benchmark for assessing what percentage of incorrectly marked assessments warrants censure from NZQA. The moderation report was thus made without probative evidence, and was unreasonable.
[50] Fifthly, in relation to the EER cancelled four days prior to it beginning, NZNC had a legitimate expectation that it would be conducted before any cancellation decision was made. It was unreasonable not to have undertaken it as planned. The basis for this is as follows:
(a) NZNC had a legitimate expectation that the respondent would not make any decision on categorisation or registration until a full independent evaluation had occurred as planned.
(b)This was a reasonable expectation that fair procedure would be followed. NZNC had detrimentally relied upon a clear and unambiguous representation from NZQA, namely that the EER would proceed as planned. A legitimate expectation can arise where there has been an express promise from a decision maker or the existence of a regular practice which the claimant can reasonably expect to continue, here the statutorily required regular EER.
[51] The sixth claim that the decision was illegal was that NZQA relied on material errors of fact or made a decision unsupported by probative evidence:
(a) The first fact contested was that NZNC had voluntarily discontinued the National and New Zealand Diplomas, so NZQA’s concerns about the moderation issues of these programmes was in error. This was a slightly different version of the claim that NZQA had taken into account an irrelevant consideration.
(b)The second contested fact was NZQA’s conclusion in the moderation report for the Uniprep scheme dated 20 September 2017 that 30 per cent of students were given passing grades when they should have been given failing grades. NZQA failed to establish that this rate was unacceptably high, or that this margin of error after moderation was outside the normal range. Accordingly relying on this as a reason for cancellation was a material error of fact.
Predetermination
[52] The applicant’s second cause of action was that the decision made was subject to pre-determination. The applicant set out five separate decisions made by NZQA between May 2017 and the November cancellation decision which it invited the Court to draw the inference that they formed a pattern of NZQA acting with a closed mind. The four incidents complained of were that:
(a) The decision by NZQA to abandon its efforts to re-categorise NZNC in favour of giving notice of proposed cancellation, which was made without explanation.
(b)The failure of the notice of proposed cancellation to take into account the applicant’s submissions of 21 July.
(c) The decision by NZQA to cancel the EER days before its commencement, after months of preparation for it.
(d)The failure by NZQA to take into consideration further moderated samples of Term 3 Level 7 Diploma assessments provided on
3 November, because it would “introduce unacceptable further delays”.
[53] Together, the applicant submits these form the basis of an inference that NZQA undertook its statutory powers of decision with a closed mind, and that any required consideration of the applicant’s improvements in performance and outcomes was either not done, or belated and perfunctory.
[54] The applicant’s written submissions set out the basis for the claims of illegality, including taking into account irrelevant considerations over 21 pages. The submissions as to pre-determination spanned one and half pages and to a great extent replicated prior submissions under different heads of review. In the circumstances,
they do not seem to add much to the claims of illegality.
Unreasonableness
[55] The third cause of action alleged that two aspects of the decision by NZQA
were unreasonable:
(a) The decision to cancel the EER scheduled for September at short notice was unreasonable as it was made without reference to all relevant information, including the recent improvements of NZNC.
(b)The conclusion in the 20 September Moderation Report that an unacceptable proportion of students enrolled in the Uniprep scheme were being wrongly assessed (30 per cent) was made without reference to an external standard or objective and consistently applied evidential basis.
Discretion
[56] The applicant finally made submissions as to the Court’s discretion that, in the event a reviewable error was found, the following factors favoured the Court using its discretion to grant relief to the applicant:
(a) The purpose of the Act (NZQA’s empowering legislation) was to “ensure that New Zealand qualifications are regarded as credible and robust, nationally and internationally”. Given the improvements in its services made by the applicant, its students would be better served if relief is granted and the cancellation overturned.
(b)The 430-odd students still enrolled with NZNC are best served by continuing their education with NZNC under its new improved regime,
and not subject to the stress of being transferred out of the programme or deported from the country. This is particularly when the logistics of cancellation and transfer will not be able to be sorted until after the holiday period and NZQA has made no indication of which alternate provider can step in to replace the full range of courses offered by NZNC.
[57] Ms Scott for the respondent submitted in response to the applicant on six different topics.
[58] In relation to the National and New Zealand Diplomas the respondent submitted that the empowering provision of the Act permitted NZQA to make the decision to cancel if it was “satisfied on reasonable grounds that … the establishment is not … or has not complied with one or more of the conditions applying to it” (emphasis added).6 Historical breaches were thus a permissible consideration for NZQA.
[59] In relation to the issue of NZNC’s non-payment of the alternate provider invoices the evidence from NZQA was that the two issues were dealt with separately on their own merits and that there was no evidence that this was a relevant consideration in the decision to cancel the registration.
[60] In relation to NZNC’s subsequent and allegedly significant improvements in governance, performance, assessment and moderation Ms Scott submitted that NZQA gave proper consideration to this factor, as set out in its reasons for the decision dated
14 November. Recent improvements in performance was not a mandatory consideration, thus could not be determinative of the decision to cancel as contended for by the applicant.
[61] NZQA was not obliged to engage in time consuming moderation using various experts to review a further 360 pages of Level 7 Diploma materials provided a month
after the notice of proposed cancellation.
6 Education Act 1989, s 233D(1)(a)(ii).
[62] As to the 20 September moderation report in relation to the Uniprep Scheme, the moderation process did not involve replicable benchmarks or a set standard. Rather, NZQA’s decision was based on a holistic assessment of a report compiled by various expert moderators. The allegation that this was unreasonable or made on a
mistake of fact was without basis.
[63] NZNC’s expectation that the standard EER process would take place or displace statutory actions in train was not a legitimate expectation warranting review. NZQA did not represent to NZNC, nor do the EER rules provide that an EER would precede, be prioritised over or trump any statutory action. On the contrary, the EER Rules expressly do not affect the ability of NZQA to take any actions around cancellation of the registration of a PTE.7
Law
[64] PTEs are regulated under Part 18 of the Act. Section 233 sets out the criteria that a PTE must meet before registration will be granted by NZQA. It is a condition of registration under s 233B(1) that a PTE must comply with all relevant rules made by NZQA under s 253. For our purposes, these rules include the EER Rules, the Registration Rules, the Accreditation Rules, and the Training Scheme Rules 2012 (together, the Rules).
[65] The power to cancel the registration of a PTE is a statutory power set out in s 233D of the Act. Section 233D reads (emphasis added):8
(1) The Authority may cancel the registration of a registered private training establishment—
(a) if it is satisfied on reasonable grounds that—
(i) the establishment no longer meets 1 or more of the criteria set out in section 233(1); or
(ii) the establishment is not complying, or has not complied, with 1 or more of the conditions applying to it; or
(b) if the establishment has provided false or misleading information in its application for registration; or
(ba) if it is satisfied on reasonable grounds that the establishment has failed or refused to comply with any relevant duties or obligations under this Act, including, but not limited to, the obligations relating to student fee protection; or
(c) at the written request of the establishment.
…
(3) Before cancelling a registration under subsection (1)(a) or (b), the
Authority must—
(a) notify the establishment that it is considering cancelling the establishment’s registration, and give reasons; and
(b) give the establishment a reasonable opportunity to respond to the notice; and
(c) consider any submissions made by the establishment in response to the notice.
(4) If the Authority cancels a registration under this section, it must give notice of its decision to both the establishment and the Commission, with reasons.
(5) Nothing in this section limits the Authority’s powers under section
255(7)(a) to cancel an establishment’s registration.
[66] The various Rules whose breach formed the basis of the decision to cancel were promulgated by NZQA under s 253 of the Act. The section permits NZQA to make rules “prescribing requirements that the applicant must meet in order to maintain the registration approval, accreditation or consent granted by the Authority”.9
[67] Judicial review is available under s 3 of the Judicial Review Procedure Act
2016 in relation to the exercise or purported exercise of a statutory power of decision. A “statutory power of decision” is defined as:10
a power or right conferred by or under any Act … to make a decision deciding or prescribing or affecting—
(a) the rights, powers, privileges, immunities, duties, or liabilities of any person
[68] The decision made by NZQA on 14 November is judicially reviewable by this
Court as a statutory power of decision.
[69] The legal principles governing review are briefly summarised by Whata J in
Akaroa Marine Protection Society v Minister of Conservation and I adopt them here:11
I may review the decision for error of law, irrelevant considerations or failure to have regard to relevant considerations, procedural impropriety, and/or irrationality. I further proceed on the basis that the underlying objective of judicial review is to maintain the rule of law, reflecting the judicial commitment to the principles of legality and substantive fairness. [footnotes omitted]
[70] There is recognition in New Zealand that grounds of review tend to overlap in practice and there may be no fine distinctions between them.12 Here the applicant’s submissions as regards judicial review on the ground of illegality can be summed up by the question: did the decision-maker (at each stage):13
direct [itself] properly in law and then act according to law. [It] must observe the criteria expressly or implicitly laid down in the legislation. So [it] must call [its] attention to matters [it is] bound by the statute to consider and [it] must exclude considerations which on the same test are extraneous.
Analysis
[71] The position for the applicant is ultimately that, having been censured by NZQA in relation to the National and New Zealand Diploma programmes, it proceeded to take all the necessary steps to improve its performance in the remaining two business courses to a standard it was confident would prevent NZQA from cancelling its registration once considered by NZQA. The applicant’s case is that NZQA acted with a closed mind and failed to engage in a meaningful way with NZNC’s progress when it cancelled the September EER and refused in November to moderate the Term three results. This, the applicant concludes, makes the decision
flawed to a degree that warrants overturning by this Court.
11 Akaroa Marine Protection Society v Minister of Conservation [2012] NZHC 933; [2012] NZAR 655 at [39].
12 Wilson v Auckland City Council [2007] NZAR 711 (HC) at [17].
[72] The position for NZQA is that NZNC had not been performing its statutory obligations, or was performing them below standard from as far back 2015. NZNC had failed to improve on its performance all the way up until 20 September 2017 when the report on the Uniprep scheme was finalised and demonstrated the systemic problems previously raised in other courses continued (in relation to moderation, plagiarism and nonsensical work being marked as competent). NZQA, having established a series of historical breaches and ongoing concerns in relation to a large portion of NZNC’s programmes and training schemes was entitled to take statutory actions to review, re-categorise and ultimately cancel the registration of NZNC.
The multi-stranded nature of NZQA’s role
[73] One of the issues with the way NZQA handled its interactions with NZNC is the multiplicity of actions and reviews that were occurring simultaneously throughout this year. This multi-stranded approach by NZQA is, as I understand it, part of the reason that NZNC is attempting to collaterally attack various decisions made prior to the ultimate decision to cancel.
[74] The Act gives NZQA various statutory powers to respond to performance issues by PTEs. NZQA utilised each of these powers at different points in 2017. These powers are, in order of escalating severity:
(a) compliance notices under s 255 of the Act;
(b)the re-categorisation process set out in r 11 of the EER Rules made under the Act; and
(c) the cancellation of registration process set out in s 233D of the Act.
[75] NZQA issued the two compliance notices under s 255 in May 2017 in relation to two types of NZNC’s programme accreditation.14 The Act requires such a notice to
set out a time within which the PTE must comply with the notice. If the recipient PTE
14 Education Act 1989, s 255(2)(b).
does not comply, NZQA has power to withdraw, revoke or vary conditions of accreditation.15
[76] NZQA did not and could not complete this process regarding NZNC’s conditions, because NZNC voluntarily withdraw the two types of programmes under challenge on 22 May 2017.
[77] NZQA then began the separate re-categorisation process under the EER Rules on 3 July 2017. This process was a backwards-looking one, and relied on the same grounds as the compliance notice proceedings. The normal process set out in the EER Rules was that if NZQA had serious concerns of the type set out in r 11.3 (here, significant or repeated non-compliance with the Act or rules, resulting in compliance notices being issued) it must follow the process set out in r 11.4 (emphasis in original):16
(a) NZQA will give written notice to the institution or ITO of NZQA’s intention to change its categorisation status to that of Category withdrawn, and set out which statement or statements of confidence NZQA considers no longer applies due to one or more of the serious concerns set out in Rule 11.3:
(b)NZQA will give the institution or ITO at least 10 working days to respond to the notice:
(c) NZQA will consider any submissions which are made by the institution or ITO within the response period given under paragraph (b):
(d)after considering any submissions under paragraph (c), NZQA will notify the institution or ITO of the decision of NZQA as to whether or not NZQA has changed the categorisation status of the institution or ITO to Category withdrawn and, where NZQA does change the categorisation status to Category withdrawn, begin the process for
scheduling an early EER for the purposes of Rule 11.2(b) (except where an EER has been started but not yet concluded).
[78] Having followed that process, r 11.2 gives NZQA the discretion to change the institute’s categorisation to withdrawn and schedule an early EER “except where NZQA [becomes] aware of the serious concerns during an EER which has started but not yet concluded”.17 The rules do not require the EER already underway be taken to completion. Rules 15.1 instead states that: 18
these rules do not affect the ability of NZQA to take any of the following actions under the Act [including] cancellation of the registration of a PTE, or imposition of conditions on its registration …
[79] Here, while the EER was being prepared for, NZQA had two distinct processes underway: the monitoring report of the Level 7 Diploma which was finalised on
20 July, and the moderation of the Uniprep scheme materials and the consequent report. The Level 7 Diploma moderation results showed 21 out of 40 assessments marked as a pass should have been failed. Twenty-seven recommendations were made for NZNC to improve its performance across all levels and aspects of its programmes. NZQA allowed the EER planning and the re-categorisation proceedings to progress up until 20 September when the finalised moderation results for the Uniprep training scheme were made available. At this stage NZQA appears to have deemed this final example of moderation issues as the sort of systemic “serious concerns” referred to in r 11.2 which might warrant the halting of an EER process already underway.
[80] I find this accumulation of factors explains why NZQA progressed so far through the EER process, before finally determining that a stronger statutory response was required. The third statutory process, being that around cancellation of registration, commenced at that point, and the EER was postponed while the statutory action superseded.
[81] This proceeding is factually dense, and reflects the multi-faceted process that NZQA must engage with in continually monitoring, assessing and re-assessing educational institutes across the board at all levels in New Zealand. It is explicable
that NZQA was simultaneously operating different disciplinary processes throughout this year, as it continually attempted to supervise different aspects of NZNC’s assessment and moderation in different subjects. Each of these moderation processes are time consuming; both internal marking and then external moderation take time, on top of which reports are to be drafted, sent out for submissions, the submissions considered and the report then finalised.
[82] I will now turn to assessing each of the applicant’s grounds of review in turn. I agree with the respondent’s structuring of the issues in its written submissions. I will address each of the applicant’s grounds of review in accordance with the five elements of the decision which are under specific challenge.
Historical breaches
[83] The first area of contention is the consideration to be given to the shortcomings of the National and New Zealand Diplomas, shortcomings which have been acknowledged by NZNC throughout the year. NZNC, after being issued compliance notices by NZQA, voluntarily ceased delivery of these programmes.
[84] In relation to mandatory and irrelevant considerations I adopt the test used in Shi v the Chief Executive of the Ministry of Business, Innovation and Employment (emphasis added):19
The exercise of a discretionary power may be invalid if the decision-maker fails to take into account relevant considerations or takes into account irrelevant considerations. Failing to take a discretionary relevant factor into account may render a decision unlawful if the reason for excluding it involves an error of law. The approach to determine whether the factor in question is or is not relevant to the empowering provision, and whether that factor actually influenced the decision. Determining what factors are relevant depends on the text and purpose of the statutory provision in question. … The effect of finding that a decision maker considered an irrelevant factor or failed to consider a relevant factor does not automatically invalidate the challenged decision. The test is whether the decision maker would have acted that way but for having considered the irrelevant factor, or having failed to consider the relevant factor.
19 Shi v Chief Executive of the Ministry of Business, Innovation and Employment [2014] NZHC 1217 at [34] and [35].
[85] The 14 November cancellation notice by the respondent made clear that NZNC’s historical breaches in relation to its performance in assessing, moderating, and managing the National and New Zealand Diploma programmes were a consideration in favour of the decision to cancel.
[86] I agree with Ms Scott for the respondent that the Act expressly permits NZQA to take into account previous times of non-compliance. Here, there is no dispute from NZNC that its assessment and moderation of the Diplomas was wholly inadequate compared to the strict standards set by NZQA. Section 233D permits NZQA to cancel the registration if it is satisfied on reasonable grounds that the establishment has not complied with one or more of its conditions of registration.
[87] The claim of the applicant that the withdrawal of those programmes meant they could not form a consideration in NZQA’s decision matrix cannot be sustained. There is nothing in NZQA’s empowering provision to indicate decisions can only be made based off courses currently on offer. A history of non-compliance is relevant to determining current and anticipated future compliance. I disagree with the applicant that this interpretation will give rise to uncertainty as to when NZQA will engage in cancellation of registration proceedings.
[88] I find that NZQA did not take into account an irrelevant consideration when including NZNC’s previous conditions breaches in its decision under s 233D.
[89] The applicant attempted to recast these facts to simultaneously claim that, in considering NZNC’s performance in relation to discontinued programmes, NZQA made a material error of fact. Material error of fact requires the factual inquiry to have been clearly inadequate, or otherwise the product of an unfair process, or where a finding of fact is utterly unsupportable on the evidence.20 As a ground it is neither relevant nor made out on these facts. I accordingly will not pursue this argument further. If the applicant was attempting to claim that the consideration of historical breaches by NZQA was so erroneous as to amount to an error of law, then again I must disagree, on the basis that the statute clearly permits consideration of historical
breaches in assessing continued fitness for registration.
20 Woods v Legal Complaints Review Officer [2013] NZHC 674 at [39].
[90] The applicant finally claimed that this factor might be used to draw an inference of predetermination by NZQA. I will address predetermination at the end of this judgment at [117].
Significant improvements in performance
[91] The second area of contention is the alleged “significant improvements” NZNC made in its delivery of its programmes and training schemes between May and November 2017.
[92] Where the empowering statute provides no guidance on relevant considerations, they must be construed from the subject matter, scope and subjects of the act “as ascertained from the whole of its provisions”.21 The Court of Appeal has found that “the more general and more obviously important the consideration, the readier the court must be to hold that Parliament must have meant it to be taken into account”.22 Here the submission of the applicant was that, absent clear statutory guidance as to what considerations must form the basis that a PTE “is not or has not complied with one or more of the conditions applying to it”, the Court should hold recent improvements in performance to be both a relevant and a mandatory consideration in the decision to cancel.
[93] I agree that recent improvements by NZNC were a relevant consideration for NZQA in making its decision. I also find that NZQA did explicitly engage with these improvements in Appendix 1 to its decision, where it explained it was not persuaded both that the improvements had come soon enough, and were sufficient or sustainable. I agree with the applicant’s proposition that:23
It is not inconceivable that a PTE which had earlier breached its conditions could nevertheless improve to such an extent that is should be permitted to continue to operate.
[94] Such an assessment rests with NZQA at the decision maker. NZQA here determined on all the evidence before it that the quality and duration of the systemic
21 Keam v Minister of Works and Development [1982] 1 NZLR 319 at 327 (CA).
22 CREEDNZ Inc v Governor-General [1981] 1 NZLR 172.
23 Applicant submissions, 4 December 2017 at [145].
breaches of the Rules did not engender confidence in NZNC’s proposals and efforts to improve. Such a finding was open to NZQA on the evidence before it.
[95] I do not agree with the submission for the applicant that the recent improvements by NZNC were a mandatory relevant consideration which NZQA was obliged to take into account. The relevant considerations for this decision are the various Rules (the Accreditation Rules, the Training Scheme Rules and the Registration Rules) and whether they have and are being complied with. On no reading does the statute impose an obligation on the decision-maker to undergo any sort of further assessment as to whether they are currently being complied with, having already determined that the Rules have not previously been complied with. As
Ms Scott submitted, such a requirement would be highly onerous on NZQA, and would delay the process by which cancellation could be achieved by some months. This in turn, could not be in the best interests of the students, who would remain in limbo for a far longer period.
[96] The mandatory process NZQA must follow before cancelling registration is short; the PTE must be notified, the PTE must be given reasonable opportunity to respond, and NZQA must consider those responses before coming to a decision. The short nature of the cancellation decision making process reflects the fact that it is one of the final disciplinary processes available to NZQA. Here, as the statute and various Rules envisioned, NZQA had undertaken different processes to closely monitor and assess NZNC’s performance across its courses before coming to this stage.
[97] The only mandatory consideration for NZQA was NZNC’s past and/or contemporaneous breaches of the Rules. Given the lengthy moderation processes it is obliged to follow in moderating assessment samples, it would be highly impractical to read a further moderation requirement into the Act. I therefore do not consider the refusal to engage in moderation of 360 pages of raw material provided a month after the notice of proposed cancellation to be a failure to take a relevant consideration into account. NZNC was entitled to provide submissions up until 24 October in response to the proposed cancellation. NZQA at no stage offered to extend this process out by a further round of moderation of all or a sample of the Term three results.
[98] Having briefly reviewed the contents of the zip files of material provided on
3 November by NZNC, I do not fault NZQA for not engaging with it as a new consideration. The zip files contained various assessment answers, for the courses BUS301 (Operation Management), BUS304 (Strategic Management) and BUS303 (Marketing Management, which was part of the Level 7 Diploma). The zip files did not attach the questions that had been asked, or a schedule of what material was included, and included both individual and group assignments and some marking sheets across three different subjects. Moderation is an intensive and lengthy process, as indicated by the fact that the 30 March monitoring visit of NZQA did not result in a final external moderation report until 17 June, two and a half months later.
[99] Finally, I do not agree with the applicant’s submission that, given the power to cancel registration is discretionary, the Court ought to read into the power that PTEs ought to be given the opportunity to redeem themselves. I believe the statutory power to cancel registration is discretionary in recognition that PTEs can be operating below standard in a multitude of ways. The Act and the various Rules promulgated by NZQA to regulate all aspects of PTEs form a dense regulatory web which a PTE may be in breach of. Not all breaches are created equal, thus it is appropriate NZQA retain the discretion to determine when a PTE has failed to qualify with conditions to such an extent that cancellation is the appropriate recourse, rather than the revoking of conditions of registration, the re-categorisation process or other disciplinary measures.
The fees dispute
[100] The third area of contention is what, if any, consideration NZQA gave to the dispute between it, NZNC and the alternate provider as to the payment of NZMA’s course fees by NZNC.
[101] Having reviewed the exchanges between NZQA’s Deputy Chief Executive Dr Klinkum, Mark Worsop of NZMA and NZNC’s Mr Wu, and the written reasons for the 14 November decision, I am not persuaded that this aspect of the communications between NZQA and NZNC was a consideration in the decision to cancel NZNC’s registration. The close timing is reflective of the fact that multiple different strands of communication in relation to multiple different aspects of NZNC’s
performance and moderation were being conducted across different teams in NZQA. I am not persuaded this element of communication bled through inappropriately into the decision to re-categorise NZNC or cancel its registration. This ground of review must fail.
EER and legitimate expectations
[102] The fourth area of contention is in relation to the EER and the process by which
NZQA did or did not treat NZNC with natural justice and in a reasonable fashion.
[103] The submissions of the applicant were that NZQA had given a clear representation between February and 22 September 2017 that an EER would be undertaken in accordance with the EER rules. NZNC had, to its detriment, relied upon this representation in spending time and money preparing for this review. Separately to this NZNC had a reasonable expectation that a fair procedure would be followed before its registration was cancelled. The applicant submits a fair process would have been to engage with these recent improvements in performance made in Term three and visible in the assessment and moderation outcomes. The EER is a regular practice of such importance that PTEs are entitled to have a legitimate expectation the review will take place.
[104] This is one of the applicant’s strongest claims in this proceeding. A full and comprehensive EER might have resulted in material which might have affected NZQA’s 14 November decision. However, while I see how an expectation has arisen, I am not persuaded that there was any statutory obligation on NZQA to undertake the EER process before making the decision that it did, or that the expectation can be upheld in legal proceedings.
[105] Not all expectations are protected by the Court in judicial review proceedings. Talleys Fisheries Ltd v Cullen sets out the generally accepted principles relating to legitimate expectations:24
(1) These are four categories of legitimate expectation: (a) of a substantive right;
24 Talleys Fisheries ltd v Cullen HC Wellington CP287/00, 31 January 2000 at 48.
(b) of an interest in a benefit which the claimant hopes to retain; (c) of a fair procedure;
(d) of a procedure not required by law will be held. […] (2) The expectation must be reasonable.
(3) Detrimental reliance upon representation is not essential but it is relevant. Absence of detrimental reliance will be rare. The principles of good administration prima facie require adherence by public authorities to their promises.
(4) The representation must have been clear, unambiguous and unqualified.
(5) Courts will not give effect to legitimate expectation if to do so would require public bodies to act contrary to law.
(6) Legitimate expectation may arise either from an express promise given on behalf of the public authority or from the existence of a regular practice which the claimant can reasonably expect to continue.
(7) Legitimate expectations to either procedural or substantive benefits can arise.
(8) The more the decision is in the policy/political field the less intrusive the courts supervision is likely to be.
[Footnotes omitted]
[106] Here, while I agree the applicant might have expected the EER process it was engaging with would be seen through to its conclusion, this was not a legally protected expectation for the following reasons:
(a) While the process of a regular EER can be described as “a regular practice which the claimant can reasonably expect to continue”, the process is specifically qualified as anticipated in Talleys Fisheries. The EER Rules reserve the position of the decision-maker to commence separate and prioritised processes, particularly where it has “serious concerns” about the reviewed PTE’s performance. It was made clear that the progression or imminence of an EER did not affect the ability of NZQA to undertake other statutory actions, including those relating to cancellation.
(b) There was no express promise that the EER would be seen through to
its conclusion. It was understood by all the parties that it would be, up until the Uniprep moderation results were finalised on 20 September
2017 at which stage NZQA began contemplating a statutory course of action.
[107] These two factors demonstrate that there was no “clear, unambiguous and unqualified representation” upon which the applicant could reasonably have relied. In the circumstances, NZQA did not breach any of the applicant’s legitimate expectations in a way warranting judicial review.
The University Training Programme
[108] The fifth area of contention is the dispute as to whether there was sufficient factual basis for NZQA to conclude there was “a concerning proportion of students being wrongly assessed” in the monitoring report of the Uniprep scheme finalised on
20 September.
[109] NZNC does not dispute the content of the moderation report that nearly a third of the sample assessments were marked incorrectly as passing. Instead it submits that the conclusion reached (that 30 per cent is a “concerning proportion” of error) lacks an objective standard of reference. NZNC submits that this conclusion was both a material error of fact, made without probative evidence and was unreasonable.
[110] As I set out in [89] above, material error of fact requires the factual inquiry to have been clearly inadequate, or otherwise the product of an unfair process, or where a finding of fact is utterly unsupportable on the evidence.25 The monitoring report, which was the result of a lengthy inspection and review process – including external moderation – cannot be said to contain any material error of fact.
[111] The finding that 30 per cent of students were passed when they ought to have failed was but one aspect of this report. It contributed to NZQA’s opinion in the cancellation decision that, in relation to the Uniprep scheme, NZNC had breached the
condition requiring it to have:26
25 Woods v Legal Complaints Review Officer [2013] NZHC 674 at [39].
26 Training Scheme Rules 2012, r 4.1, criterion 5.
… assessment methodologies [which] provide fair, valid, consistent and appropriate assessment of student achievement, given the stated learning outcomes, and … an effective system for moderation of assessment materials and decisions, in relation to the [Uniprep] training scheme …
[112] The question is thus whether a PTE which passes 30 per cent of its students in assessments when they ought to have failed can be said to provide valid and appropriate assessment with an effective system of moderation. As was explained by Ms Boyack in her affidavit of 29 November 2017 this question is not determined against a single objective standard. Instead such a determination involves the weighing of different factors by NZQA, including the external moderation report, the actual grade awarded to students, the number of times they were permitted to attempt the assessment, as well as plagiarism concerns. Taken as a whole I find there was adequate material to support the conclusion reached.27 The allegations of no probative evidence by the applicant are not made out to the standard warranting judicial review:28
It is entirely one thing to weigh evidence which might go either way; or even to incorrectly evaluate evidence. But it is quite another to make entirely unsupportable findings. To find facts without evidence of this character is an abuse of power, and as such it ought to be within the scope of judicial review.
[113] Nor can the claims that this conclusion was unreasonable be sustained, as the test of a factual conclusion “which is clearly wrong or untenable”29 or “which no reasonable authority could ever have come to”30 has not been reached.
[114] In the circumstances NZQA is not required to set out specific criteria as sought by the applicant as to what proportion qualifies as “concerning”. NZQA has a broad discretion and must, in regards to cancellation, be reasonably satisfied. This does not impose the sort of evidential burden sought to be imposed by the applicant.
[115] Even if a material error was made out, I would not determine this cause of action a sufficient ground to warrant relief from the Court, as this was only a small
part of the larger reasoning behind the decision to cancel NZNC’s registration.
27 Pring v Wanganui Ltd District Council (1999) ELRNZ 464 (CA) at [7].
28 Discount Brands Ltd v Northcote Mainstreet Inc [2004] 3 NZLR 619 (CA) at [58].
29 Vodafone New Zealand Ltd v Telecom New Zealand Ltd [2011] NZSC 138 at [16], [52], and [58].
30 Associated Provincial Picture Houses Limited v Wednesbury Corporation [1948] 1 KB 223.
[116] As a final point I must disagree with the applicant’s submission that the
20 September report was not “newly available” as it retained much of the content and formatting of the draft version sent to NZNC for comment on 31 July 2017. NZNC’s comments were received by NZQA on 14 August at the latest. The report was finalised on 20 September and immediately sent to NZNC. Only then did its findings relating to the Training Scheme Rules breaches come to form a basis of NZQA’s decision- making matrix. This was appropriate, and indicates the opposite of pre-determination.
Pre-determination
[117] I turn finally to the issue of pre-determination. Claims of pre-determination face an uphill battle. The threshold for predetermination is high; that a position is put forward and is rejected is not evidence of a closed mind.31 NZNC must persuade this Court that NZQA gave “merely token or superficial regard to all the mandatory considerations, including the submissions received”32 and that NZQA “was not open to persuasion”.33 Another way of phrasing this was set down by Richardson J in CREEDNZ Inv v Governor-General:34
If [the decision-makers] had approached the matter with minds already made up, the inference would be readily be drawn that they could not genuinely have considered the statutory criteria when advising the making of [the decision].
[118] The applicant set out four different decisions by NZQA which, taken together, it submitted to be used to draw an inference that NZQA was not open to persuasion.35
I am not able to draw such an inference, for the following reasons:
(a) Historical breaches in relation to the National and New Zealand
Diplomas were a relevant consideration.
(b)The decision to shift from the re-categorisation process to the cancellation process is explicable given the new information NZQA
received on 20 September 2017.
31 Butler v Attorney-General HC New Plymouth CIV-2004-443-332, 19 August 2004.
32 New Zealand Fishing Industry Association Inc v Minister of Agriculture and Fisheries [1988]
1 NZLR 544 (CA) at 552.
33 CREEDNZ Inv v Governor-General [1981] 1 NZLR 172 (CA) at 194.
34 At 179 per Cooke J.
35 Set out at [52] above.
(c) This new information also adequately explains the halting of the EER process while NZQA recalibrated its response and shifted to a more severe disciplinary process.
(d)NZQA had no obligation to commence moderation of the 360 pages of materials provided to it in early November. Refusal to engage with this material does not indicate a closed mind.
[119] Overall I am not persuaded that NZQA erred in its decision-making process, nor that the shift from the re-categorisation process to the cancellation process was unreasonable or procedurally unfair. Nor does it indicate a pattern of pre- determination. On the contrary, NZQA was fully preparing to engage with NZNC in respect of its improvements up until 20 September, mainly around alleged improvements in the provision of the Level 7 Diploma which formed the bulk of NZNC’s classes aside from the language courses. When further detrimental information was provided to it in relation to the Uniprep scheme being run by NZNC, this meaning that four out of four of the non-language related programmes and training schemes on offer had been found (and three of them admitted by NZNC) to have systemic problems in assessment, moderation and plagiarism, NZQA commenced the process indicating that it had lost confidence in NZNC. I am unable to draw any inference that in this situation NZQA was acting with a closed mind, or that it could be said to be unreasonable.
Conclusion
[120] For all of the reasons set out above, I am not persuaded that there are any reviewable errors in NZQA’s decision-making process. Accordingly the application for judicial review is declined.
[121] Costs are reserved. I invite the parties to settle the issue of costs between themselves, however, failing agreement the respondent is to file a memorandum with this Court within 10 working days, with the applicant having a further five working days to respond.
Churchman J
Solicitors:
Chen Palmer Public and Employment Law Specialists, Wellington for Applicant
McElroys, Auckland for Respondent
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