Kim v Minister For Immigration & Multicultural & Indigenous Affairs [2004] FCA 31 (3 February 2004)

ADMINISTRATIVE LAW – Whether The Decision Is A Privative Clause Decision – Whether The Decision Contained A Jurisdictional Error – Whether There Was A Failure To Recognise The Nature And The Extent Of The Power Exercised

MIGRATION – Business Visa – Secondary Business Visa – Standard Of Proof Required By ‘Would Result’ In S 135(5)

STATUTORY INTERPRETATION – Whether Section 134 Contains A Residual Discretion – Whether S 134 Imposes A Duty On The Minister To Exercise The Power To Cancel A Visa

PRACTICE AND PROCEDURE – Issue Raised On Appeal That Was Not Raised Before The Tribunal

Chen V Minister For Immigration And Multicultural And Indigenous Affairs [2002] Fca 1496 Distinguished

Finance Facilities Pty Ltd V Commission Of Taxation Of The Commonwealth Of Australia [1971] HCA 12; (1971) 127 Clr 106 Cited

Minister For Immigration And Multicultural Affairs V Bhardwaj [2002] HCA 11; (2002) 209 Clr 597 Approved

Plaintiff S157/2002 V Commonwealth Of Australia [2003] HCA 2; (2003) 211 Clr 476 Cited

Samad V District Court Of New South Wales [2002] HCA 24; (2002) 209 Clr 140 Approved

Ward V Williams [1955] HCA 4; (1955) 92 Clr 496 Approved

Jong Hak Kim, Gwan Jun Kim, Hyun Ji Kim V Minister For Immigration & Multicultural & Indigenous Affairs
Q72 Of 2003

KIEFEL J
BRISBANE
3 FEBRUARY 2004

IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY	Q72 OF 2003

ON APPEAL FROM A DECISION BY MR B McCABE, MEMBER OF THE ADMINISTRATIVE APPEALS TRIBUNAL

BETWEEN:	JONG HAK KIM, GWAN JUN KIM, HYUN JI KIM APPLICANTS
AND:	MINISTER FOR IMMIGRATION & MULTICULTURAL & INDIGENOUS AFFAIRS RESPONDENT
JUDGE:	KIEFEL J
DATE OF ORDER:	3 FEBRUARY 2004
WHERE MADE:	BRISBANE

THE COURT ORDERS THAT:

1. The decision of the Administrative Appeals Tribunal of 24 April 2003 is set aside.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY	Q72 OF 2003

ON APPEAL FROM A DECISION BY MR B McCABE, MEMBER OF THE ADMINISTRATIVE APPEALS TRIBUNAL

BETWEEN:	JONG HAK KIM, GWAN JUN KIM, HYUN JI KIM APPLICANTS
AND:	MINISTER FOR IMMIGRATION & MULTICULTURAL & INDIGENOUS AFFAIRS RESPONDENT

JUDGE:	KIEFEL J
DATE:	3 FEBRUARY 2004
PLACE:	BRISBANE

1 The applicant, a Korean national, was granted a subclass 127 Business Skills (Migrant) Visa (a ‘business visa’) on 26 February 1999. The visa permitted the applicant to travel to and enter Australia for a period of five years from the date of grant. Secondary visas of the same subclass were issued to his two children. The applicant travelled to Australia on 10 March 1999. Since then he has travelled to and remained in Australia for three to four months per year.

2 The declaration completed by the applicant when applying for the visa stated that he would be required to complete surveys at two points. The first survey was due on 6 April 2001. A form for completion in connexion with that survey was sent to the applicant on 2 February 2001. It does not appear that he responded to it. Another form was sent under cover of a letter on 15 November 2001. On 30 January 2002, Notices of Intention to Cancel the primary and secondary visas were sent to the applicant and his family. After receipt of responses to that notice the Minister’s delegate decided to cancel the visas. The applicant and his children were so advised on 5 August 2002. The Administrative Appeals Tribunal (‘the Tribunal’) affirmed that decision on 24 April 2003. The applicant has brought an appeal from that decision pursuant to s 44 of the Administrative Appeals Tribunal Act 1975 (Cth).

(ii) utilise his or her skills in actively participating at a senior level in the day-to-day management of;

(i) the length of time that the person held the ownership interest or participated in the management (as the case requires); and

(ii) the reasons why the person no longer holds the interest or participates in the management (as the case requires).’

5 In his statement forwarded to the Minister’s delegate, in response to the notice given under s 135, the applicant said that he had originally intended to buy into an established business in Australia. He had had dealings with a company called Tradeport International (Aust) Pty Ltd and had exported tiles to them since 1993. His business background was the manufacture and sale of tiles. He invested approximately $114,285 in that company on 31 May 1993. He had previously given the company the sums of $23,404.42 and $10,600, in 1999 and 2000. He was unable however to obtain a commitment from the owner of the company to a sale of some shares in the company. That person did indicate that he considered they were acting as a joint enterprise. In the ‘normal Korean way’ they did not formalise their discussions in writing. The applicant took steps to obtain orders for the company which were then placed with his Korean company which exported the tiles into Australia. He says that he assisted Tradeport with client contact, sales promotion, marketing and administration and helped search for a suitable warehouse.

6 The applicant said that in recent times he had been attempting to sell his assets in Korea in order to allow him to commence a large-scale business of his own in Australia. He was now less confident of a venture with the owner of Tradeport, but was considering that person’s proposal to set up a branch of that company on the Gold Coast. He had also been investigating establishing operations in Vietnam, but in the last few months had decided against that course. He was now more actively pursuing the establishment of a factory in Australia.

7 The Minister’s delegate had found the matters in s 134(1) established. The Tribunal was of a like opinion. There was no dispute that the applicant had not acquired a substantial ownership interest in an Australian business. There was no evidence that he had actively participated in the senior management of such a business. It followed, in the Tribunal’s view (at [13]) ‘that the Minister may properly cancel Mr Kim’s visa unless he was satisfied as to the matters in sub-section (2), having particular regard to the matters in sub-section (3)’. The Tribunal then went on:

8 The applicant does not challenge these findings on the appeal. It is his case that s 134 contains a residual discretion. The Minister submits that that point was not taken before the Tribunal. I shall return to this issue after considering the nature of the power given by s 134.

9 Where a statute provides that an act may be done, the act may be done at discretion: s 33(2A) Acts Interpretation Act 1901 (Cth). The use of the word, whilst presumptive, is not conclusive of the existence of a discretion and it may instead impose a duty to act: Ward v Williams [1955] HCA 4; (1955) 92 CLR 496 at 505. The Court there approved the statement in Julius v Bishop of Oxford (1880) LR 5 AC 214 at 235, that the question whether a public officer was bound to use the power given, is to be solved by reference to the context of the statute, the particular provisions and the general scope and object of the enactment conferring the power.

10 In Samad v District Court of New South Wales [2002] HCA 24; (2002) 209 CLR 140, the case upon which the applicant relies, Gleeson CJ and McHugh J considered that the statutory context may be crucial to the question whether, on its true construction, the statute imposes a duty to exercise the power in certain circumstances. In that case the object of the power was a licence granted under the Poisons and Therapeutic Goods Act 1966 (NSW) for the supply of methadone from particular premises. One of the grounds for cancellation provided for by the regulations made under the Act was where disruption to the amenity of the area in which the premises were situated was being caused by the supply of methadone. It had been argued, and accepted in the New South Wales Court of Appeal, that once the Director-General was satisfied that there was a disruption to the amenity of the area he was legally obliged to cancel or suspend the licence. His only choice was as between those two courses (see Samad at 147 [13]).

11 In view of Gleeson CJ and McHugh J (at 153 [37]) there were aspects of the regulatory scheme which did not suggest that the scope of the discretion was so narrowly confined. If the decision-maker was obliged to cancel or suspend a licence whenever one of the grounds specified was made out the result in some cases would be that it would be cancelled for technical or trivial breaches of condition. It was difficult to glean a statutory purpose which would deprive the relevant decision-maker of the capacity to excuse such a contravention or failure or to deal with it by some other means. The regulation provided for the grant and renewal of licences on terms and conditions considered to be appropriate. A possibility, which the evidence disclosed, was that the more appropriate remedy in a particular case might not be suspension or cancellation but the imposition or variation of licence conditions. The examples given by their Honours were the alteration of hours of operation or the reduction of the number of people the clinic served, which changes might eliminate or reduce the disruption to the area’s amenity. It was, in their Honours’ view, an important part of the regulatory scheme that the Director-General had the ability to deal with problems in that way.

12 Gaudron, Gummow and Callinan JJ were also of the view that the power to impose further conditions and to vary or revoke them was indicative of a wider discretion, as was the requirement that the licence-holder be given an opportunity to make representations and for the Director-General to consider them (at 163 [76]). Their Honour’s said:

13 Finance Facilities Pty Ltd v Commission of Taxation of the Commonwealth of Australia [1971] HCA 12; (1971) 127 CLR 106 furnishes an example of the provision of a power which was intended to be exercised on the mere fulfilment of a condition. The case was referred to in that connexion in each of the judgments in Samad. The object of the power was the right or entitlement of a taxpayer to a rebate. It was held that once the Commissioner was satisfied of the specified conditions he was obliged to allow the rebate. As Gleeson CJ and McHugh J however observed, where a statute confers rights or entitlements it may be easy to conclude that the legislature did not intend that they could be taken away by the exercise of a discretion (at 153 [36]).

14 To qualify for the grant of a business visa certain criteria must be satisfied. Clause 127.2 of the conditions relating to the grant of such a visa includes as primary criteria a person’s net worth, their ownership interest in one or more qualifying businesses in a particular period prior to the making of the application and their continuous involvement in that business. Most relevant to the matters referred to in s 134 is the requirement of cl 127.216 that an applicant have a genuine realistic commitment as the holder of the visa to either establish or participate in an existing eligible business in Australia, maintain or substantial ownership interest in that business and maintain direct and continuous involvement in the management of that business.

15 Section 41(1) of the Migration Act provides that the regulations may provide that visas are subject to specified conditions. Subsection (3) provides that the Minister may also specify that a visa is subject to such conditions as are permitted by the regulations. Regulation 2.05(2) provides that ‘the conditions that the Minister may impose on a visa are the conditions (if any) referred to as being conditions that may be imposed in the Part of Schedule 2 that relates to visas of the subclass in which the visa is included’. With respect to subclass 127 visas, relating to a ‘Business Owner’ cl 127.6 provides that conditions 8502 and 8515 may be imposed on a visa. Those conditions appear in Schedule 8. The first relates to entry into Australia and the second to marriage prior to entry.

16 Power is given in the Migration Act to cancel visas on a number of grounds. The various cancellation powers do not limit or affect each other: s 118. Visas may be cancelled where their grant was based upon incorrect information: s 108. Section 116 provides a wide power to cancel on grounds which include a change in the circumstances which permitted the visa and a failure to comply with its conditions. The regulations may prescribe further matters to which the Minister may have regard. In each of these cases notification of a proposed cancellation is to be given. It is anticipated, at least with respect to ss 116 and 108, that the regulations might specify the circumstances in which cancellation is obliged. Section 119(3) specifically requires the Minister to cancel a visa under s 116 ‘if there exist prescribed circumstances in which a visa may be cancelled.’ Section 109(2) is in similar terms and applies to cancellations under s 108. Sections 500A(1), 501, 501A(2) contain further powers to cancel having regard, in general terms, to the conduct or character of a visa holder, their associations and the risk presented by their presence in Australia.

17 It may be discerned from these provisions that a business visa is not one able to be conditioned in some way as an alternative to cancellation, as was the case in Samad. The criteria for the grant of the visa state the financial and skill-based attributes an applicant is expected to have and what is required of them in relation to their participation in a business in Australia. There does not appear to be any power to alter or waive those requirements or to further condition them.

18 Provisions in force at the same time as s 134 also confirm that there might be circumstances where the Minister will be obliged to cancel a visa, even though the power to cancel is expressed in discretionary terms. In each case however it is envisaged that those circumstances will be prescribed by regulation.

19 Section 134 is directed to a subsequent assessment of what has been undertaken by a business visa holder and what their further intentions are. The grant of a business visa is based, in large part, upon a person’s commitment to establish, participate in or own an eligible business in Australia. The reporting conditions are connected with the assessment and may trigger it. It is of some importance, I consider, that the Minister may exercise the power given by s 134 at any time. At any time during the currency of the visa, if the Minister is satisfied that the visa holder’s obligations have not been met and the Minister is not persuaded that there have been genuine efforts to do so or that it is intended to continue to make those efforts, then s 134 permits cancellation of the visa. The question is whether the Minister is obliged to do so.

20 There are some factors which weigh against the likelihood that that might be intended. No words indicative of obligation are used and the section is not structured in such a way as to suggest that cancellation is to follow automatically. The prohibition in subs (2) is a limit upon the power to cancel given by s 134(1) if the Minister is satisfied of the matters there listed. Those matters are not expressed as conditions for the maintenance or non-cancellation of the visa.

21 It is not obvious that cancellation is the only possibility. The Minister’s contention that the word ‘may’ in s 134(1) does not mean that there is a discretion not to cancel would be stronger if it were shown that there was nothing which might be said in the visa holder’s response to the notice of intention to cancel, which might be relevant to the exercise of a discretion, or that there was no purpose to be served by the exercise of such a discretion. Whilst the discretion given in s 134(1) is not as broad as that considered in Samad, in the sense that it does not involve more choices, it cannot be said that a decision not to cancel a visa could serve no purpose. The Minister might be satisfied of the matters referred to in subs (1) and not be satisfied as to the efforts made as referred to in subs (2) but nevertheless consider in a particular case that further time should be given to the visa holder to undertake what was required of them. An explanation satisfactory to the Minister, of inaction up to the point of assessment, might be given. The nature of the power to cancel is a continuing one. There is no apparent purpose to be achieved by requiring cancellation whenever the Minister is undertaking an assessment of what has been undertaken by a visa holder. The Minister retains the right to cancellation under s 134(1) at all times. This does not suggest that the Minister is to be obliged to cancel a business visa if the Minister is not satisfied at a particular point during the currency of the visa of the matters in s 134(2).

22 The Minister’s submission concerning the applicant raising a new issue with respect to the ‘residual discretion’ is, I apprehend, based upon the discretion being wider than I have described. In any event it seems to me that there is no support for the contention.

23 In Chen v Minister for Immigration and Multicultural and Indigenous Affairs [2002] FCA 1496, the case upon which the Minister relies, Drummond J expressed the view that the Full Court in Comcare v Fiedler [2001] FCA 1810; (2001) 115 FCR 328 at 336 to 339 had held that the a tribunal is not obliged to consider every issue and matter which the primary decision-maker was obliged to consider, irrespective of the issues identified by the parties. The issue in Chen was the same as that raised here, as to whether there remained a discretion, and it had not been raised before the Tribunal.

24 The facts in Comcare v Fiedler differ from those obtaining in Chen and here. The Full Court was there concerned with the effect of a concession made by a party on an issue and as to whether the Tribunal was entitled to act upon it. Here the question involves the nature and extent of the Tribunal’s power, a question to which the Tribunal must have regard. I do not understand Comcare v Fiedler to hold that a Tribunal is not obliged to consider what is required of it and what questions are posed by the statute for its answer if there is no issue raised by a party about those matters. Here the discretion was a fundamental part of the power given by the subsection. If Drummond J held to the contrary in Chen, I must respectfully disagree. In any event there was a concession made in this case that s 134 gave a discretion. That concession was made in written submissions to the Tribunal on the Minister’s behalf.

25 It remains to consider whether the Tribunal took account of the fact that there remained a choice as to cancellation even if the Minister was satisfied about the matters listed in subs (2). It seems to me tolerably clear, from pars [13] and [15] of the reasons, that the Tribunal considered that if the Minister was so satisfied cancellation followed. The Tribunal’s reasons place the requirements of subs (2) as qualifications for cancellation. In my view it fell into error in construing the section in that way. The subsection operates only as a prohibition upon cancellation in the circumstances there mentioned. The Tribunal followed the same course as the Minister’s delegate had done. The decision to cancel was seen to take only upon a consideration of the matters referred to in subs (2). No consideration was given by the delegate to the question whether there was nevertheless a discretion not to cancel the visa.

26 The Minister also submitted that an error of this kind does not invalidate the Tribunal’s decision. Pursuant to s 474(2) a decision made under the Migration Act is a ‘privative clause decision’, unless expressly excluded. One consequence is said to be that the Court’s jurisdiction is under s 39B of the Judiciary Act 1903 (Cth) and not s 44 of the Administrative Appeals Tribunal Act 1975 (Cth) (see s 483 of the Migration Act). More importantly, it is submitted that the exercise of the discretion does not form an ‘inviolable’ or ‘indispensable’ limitation upon the exercise of the power: R v Murray; Ex parte Proctor [1949] HCA 10; (1949) 77 CLR 387 at 399. It follows, it is submitted, that the decision is within power. There is not jurisdictional error of the kind spoken of in Plaintiff S157/2002 v Commonwealth of Australia [2003] HCA 2; (2003) 211 CLR 476.

27 I take the Minister’s argument to distinguish between a condition necessary to be satisfied before the exercise of a discretion and the exercise of the discretion itself. It is submitted that the decision here is of the latter kind. The submission overlooks the fact that the discretion was not exercised at all because the Tribunal took a wrong view of its existence. The error is more properly characterised as a failure to recognize the nature and extent of the power given which resulted in the Tribunal failing to address the question whether the discretion not to cancel should be exercised. It follows that the decision-maker did not have jurisdiction to make the decision it did and the decision was not authorised by the Act: Minister for Immigration v Yusuf [2001] HCA 30; (2001) 206 CLR 323 at 351-352 [83]. A decision involving jurisdictional error is, in law, no decision at all: Minister for Immigration and Multicultural Affairs v Bhardwaj [2002] HCA 11; (2002) 209 CLR 597 at 614-615 [51], 618 [63], 646-647 [152]; Plaintiff S157 at 506 [76]. As the majority in Plaintiff S157 there pointed out, the decision cannot be said to be a privative clause decision since it is not one made under the Act, as defined in s 474(2) and (3) of the Act.

28 Although my reasons to this point would require reconsideration of all of the visas it is appropriate to consider the way in which the Tribunal dealt with the secondary visas, having regard to s 134(5). It is the applicant’s submission that the Tribunal has misinterpreted the requirement that cancellation of such a visa would result in extreme hardship to the holder of it.

29 In relation to the applicant’s son, who had resided in Australia since 1993, it had been submitted to the Tribunal that he would be required to undertake military service if he returned to Korea and that that would expose him to danger and to conduct within the army which would be damaging to him. His business career would also be delayed.

30 The applicant’s daughter is a gifted musician and is currently undertaking university studies in music. She has lived in Australia since 1997. I add that the Tribunal observed that she had been granted permanent residency status in 1999, but this fact was not referred to in submissions. She had been accepted into a post-graduate music course at the National Academy of Music. Following this course might enable her to achieve her ambitions as a professional musician. The Tribunal observed that there was no evidence that Korean universities would be unable to meet her needs, but appears to have accepted that many opportunities were available to her in Australia and that it would be to her advantage to remain here.

31 The Tribunal accepted that it was possible that military service in Korea might be particularly objectionable and dangerous and therefore result in extreme hardship, but observed that there was no evidence to establish it as likely. It followed that it could not be satisfied ‘that extreme hardship will (as opposed to might theoretically) follow from the cancellation of the visa in this case’. So far as concerned the daughter, the Tribunal was unable to be satisfied on the evidence that she would suffer ‘that high level of prejudice envisaged by the statute’ if she returned to Korea. The Tribunal considered that she might be able to return to Australia to continue her studies.

32 The applicant’s submissions here focussed upon the test applied by the Tribunal:

33 It is submitted that the qualification ‘extreme’ has been used by the Tribunal as a level of proof to be met, and not as a qualification of the degree of hardship, as the subsection requires. In so doing it required greater certainty be shown than the subsection did. There is substance in the applicant’s contentions. The subsection requires that a causal outcome is able to be predicted. The words ‘would result’ do not however require more than the civil standard of proof. The word ‘extreme’ qualifies only the hardship which may be seen as a consequence of the cancellation of the visa. If the Tribunal applied what it took to be the reasoning in Re Wang, as appears in the last sentence in the passage set out above, then it would seem to me that it has fallen into error. Whether it did apply that reasoning is not entirely clear. It may have intended a reference to certainty in stating that its level of satisfaction with respect to the effects upon the son had to be that the extreme hardship ‘will’ follow, although it put the alternative position as a mere theoretical possibility. It may not have considered the question whether it was likely. It is less clear whether it adopted the same approach to the question of the effect upon the daughter, although one might perhaps presume that it had acted consistently. It is not necessary to further consider these questions.

34 The decisions of the Tribunal of 24 April 2003 will be set aside and the matter remitted to the Tribunal, differently constituted, for determination according to law. The Minister should pay the applicant’s costs.

I certify that the preceding thirty-four (34) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Kiefel.

Counsel for the Applicant:	Mr R Hanson QC and Mr D Rangiah

Solicitor for the Applicant:	Plastiras Meredith Mohr Lawyers

Counsel for the Respondent:	Mr P Bickford

Solicitor for the Respondent:	Blake Dawson Waldron

Date of Hearing:	21 August 2003

Date of Judgment:	3 February 2004

Federal Court of Australia

Kim v Minister For Immigration & Multicultural & Indigenous Affairs [2004] FCA 31 (3 February 2004)