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You are here: BAILII >> Databases >> United Kingdom Asylum and Immigration Tribunal >> SA (Pragmatism, No basis for decision, Paragraph 206 HC 395) Saudi Arabia [2005] UKIAT 00007 (17 January 2005) URL: http://www.bailii.org/uk/cases/UKIAT/2005/00007.html Cite as: [2005] UKAIT 00007, [2005] UKIAT 7, [2005] UKIAT 00007

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SA (Pragmatism – No basis for decision – Paragraph 206 HC 395.) Saudi Arabia [2005] UKIAT 00007

IMMIGRATION APPEAL TRIBUNAL

Date of hearing: 24 November 2004

Date Determination notified: 17 January 2005

Before
Mr. N.H. Goldstein (Vice President) Mr. M.E. Olszewski Mrs. L.R. Schmitt
Between

 

Secretary of State for the Home Department	APPELLANT
and
SA	RESPONDENT

For the Appellant: Mr. C. Trent, Home Office Presenting Officer. For the Respondent: Mr. S. Muquit, Counsel.
DETERMINATION AND REASONS
1. The Appellant, the Secretary of State for the Home Department, has been granted permission to appeal to the tribunal against the determination of an Adjudicator (Mr. J. Simpson) promulgated on 16 February 2004, when he allowed the appeal of the Respondent against the decision of the Appellant dated 31 October 2001 to refuse to the Respondent a variation of his leave to remain in the United Kingdom in business as a self-employed lawyer.
2. We have decided to allow the appeal of the Secretary of State.
3. The basis of the Appellant's refusal to vary the Respondent's leave was that the Secretary of State was not satisfied that the Respondent could show audited accounts that demonstrated the precise financial position of the Respondent's business, nor that he could show that he was actively involved on a full-time basis in trading or providing services on his own account or in partnership or in the promotion and management of the company as a director. Furthermore, the Appellant was not satisfied that the Respondent could show that his share of the profits of the business was sufficient to accommodate him and his dependants without recourse to employment (other than his work for the business) or to public funds. Ms D.K. Gill, Vice President, in granting permission to appeal observed as follows:

"The Adjudicator allowed the appeal against the refusal under paragraph 206 of the Immigration Rules. In doing so, he stated that he would take a pragmatic approach and would exercise his discretion to allow the appeal.

The grounds assert that there is no discretion under paragraph 206 and that, if the requirements of paragraph 206 are not met, then refusal is mandatory under paragraph 208.

The grounds are arguable. It is arguable that the Adjudicator had no jurisdiction to allow the appeal, as he had concluded (see paragraph 21) that the decision was lawful".

4. The grounds of appeal were as follows:

"1. The Adjudicator has allowed this non-asylum appeal under paragraph 206 of HC 395.

2. At paragraph 20 of the determination the Adjudicator states 'I am satisfied as a fact that due to the solicitor's default the Appellant failed to comply with the requirements of paragraph 206(ii) and that the Respondent was entitled on the evidence before him at the date of decision to refuse the extension requested on that ground'. However following deliberating over various factors relating to the Respondent's circumstances at paragraph 21, the Adjudicator, at paragraph 22, states 'For these reasons, I have decided to take a pragmatic approach and exercise my discretion to allow this appeal.

It is submitted that the Adjudicator erred in law in exercising his discretion and allowing the appeal because there are no discretionary powers for the Adjudicator to exercise in the particular area of the Rules, which the Adjudicator was dealing with. Rule 208 HC 395 states unambiguously that 'an extension of stay in order to remain in business is to be refused if the Secretary of State is not satisfied that each of the requirements of paragraph 206 is met'.

Whilst some areas of the Rules allow for the exercise of discretion, e.g. Rule 322(2-11) which is prefaced by 'Grounds on which an application to vary leave to enter or remain in the United Kingdom should normally be refused', Rule 206 is unequivocal.

It is submitted that the proper course is for the appeal to be dismissed and a further application submitted to allow the Secretary of State the opportunity to assess any evidence which clearly post-dates the decision.

3. It is submitted that this determination is flawed and should be set aside".

5. The Tribunal received a letter from the Appellant's solicitors Messrs. Aston Clark dated 17 November 2004 that in addition to enclosing their Counsel's skeleton argument and other documentation explained that the Respondent's two eldest dependants had submitted applications for indefinite leave to remain in the United Kingdom which were pending consideration at the Home Office. They continued:

"Likewise, the (Respondent) has submitted a further and fresh application for an extension to his leave to remain given that he continues to satisfy all the requirements necessary to be met for a business person seeking further leave in the UK".

6. We noted that within the Respondent's skeleton argument there appeared before paragraph 28 a sub-heading marked "Cross Appeal". That raised submissions relating to issues that it was contended concerned Article 8 of the European Convention on Human Rights (the "ECHR").
7. Mr. Muquit submitted that as such, a cross appeal had been filed in time.
8. There were strong objections raised by Mr. Trent who rightly submitted that the requirements of Rule 19 had not been complied with.
9. The Tribunal carefully considered the request to admit that which Mr. Muquit described as a Respondent's notice. Rule 19(2) requires that a notice must be filed

(a) within such period as the Tribunal may direct; or

(b) where the Tribunal makes no such direction, within 10 days,

after the Respondent is served with notice that the Appellant has been granted permission to appeal. It was noteworthy that as Mr. Trent pointed out, the cross appeal had not been served upon the Respondent in compliance with the Rules.

10. Mr. Muquit submitted that there was an overriding discretion of the Tribunal to permit a Respondent's Notice notwithstanding the failure to strictly comply with the Rules.
11. We did not agree and indeed observe that Mr. Muquit's submission was doubtless derived from Rule 37 of the 2003 Rules. This provides that the Appellate Authority "may, subject to these Rules, and to any other enactment, decide the procedure to be followed in relation to any appeal or application".
12. With respect to Mr. Muquit, the problem with his submission is of course that the words "subject to these Rules" in Rule 37 clearly indicate that the discretion of the Appellate Authority is circumscribed by what is to be found in the other provisions of the Rules, including Rule 19(2).
13. The Tribunal considers that even if there is power within the Procedure Rules to enable it to permit a Respondent's notice to be served upon the Appellant outside the time limit set by Rule 19(2), it would only be appropriate to exercise it if good reason could be shown for the Respondent not to have filed the notice and served a copy upon the Appellant within the requisite timescale. In the present case no such reason existed.
14. Mr. Muquit told us that it was his understanding that a copy of the "cross appeal" had been served upon the Home Office but Mr. Trent was able to tell us that no such record of service appeared within the Home Office file before him.
15. It was indeed noteworthy that Mr. Muquit frankly admitted (following an expression of our concern that his instructing solicitors should appreciate the necessity to comply with the requirements of Rule 19), that this was a matter that he had previously drawn to the attention of those instructing him. We observed in such circumstances that this was yet a further example of the failure of those instructing him to heed his advice and comply with the strict requirements of the Rules.
16. In the circumstances we were not prepared to permit the cross appeal tendered.
17. Both parties recognised that the Adjudicator's determination disclosed material errors of law.
18. It was Mr. Muquit's submission that the material error lay in the Adjudicator's approach in that he should have found that the Appellant's decision was not in accordance with the law or the Immigration Rules applicable to this case.
19. He otherwise shared the view of Mr. Trent with which we wholly agree.
20. At paragraph 20 of his determination the Adjudicator stated:

"I am satisfied as a fact that due to the solicitor's default the Appellant failed to comply with the requirements of paragraph 206(ii) and that the Respondent was entitled on the evidence before him at the date of decision to refuse the extension requested on that ground".

21. Clearly on that finding the proper course for the Adjudicator would have been to dismiss the Respondent's appeal. Instead he appears to have allowed the appeal not for reasons of law but for reasons of pragmatism. Indeed the Adjudicator made this clear at paragraph 22 when he stated:

"I have decided to take a pragmatic approach and exercise my discretion to allow this appeal".

22. Mr. Trent submitted that he relied on the grounds of appeal to which he added that it was not reasonably foreseeable that the Respondent could meet the requirements of the Immigration Rules. Indeed paragraph 208 of HC 395 was clear in its terms, namely:

"208. An extension of stay in order to remain in business is to be refused if the Secretary of State is not satisfied that each of the requirements of paragraph 206 is met".

23. Mr. Trent continued that paragraph 208 did apply and therefore the application had to be refused.
24. For the sake of completeness we would set out the relevant requirements of paragraph 206 of HC 395 insofar as they relate to the circumstances of this appeal:

"206. The requirements for an extension of stay in order to remain in business in the United Kingdom are that the applicant can show:

(ii) audited accounts which show the precise financial position of the business and which confirm that he has invested not less than £200,000 of his own money directly into the business in the United Kingdom and

(iii) that he is actively involved on a full-time basis in trading or providing services on his own account or in partnership or in the promotion and management of the company as a director and

(iv) that his level of financial investment is proportional to his interest in the business".

25. The requirements of paragraph 206(i)-(x) are cumulative and therefore failure to comply with any one of the requirements of the Rule would be fatal to an application.
26. It is apparent from the papers before us and indeed before the Adjudicator, that on 4 September 2001 the Home Office wrote to the Respondent's solicitors following their client's application of 2 July 2001 for further leave to remain as a self-employed lawyer in the United Kingdom and on behalf of his wife and children for further leave as his dependants. The Home Office in their letter listed the documents before them and continued:

"However, to enable your client's application to be considered further, could you please arrange for the following further evidence to be forwarded to us.

(1) Please forward the letter from the Law Society to the Home Office confirming there is no objection to Mr. Alothaim continuing to practise in the UK as an attorney consultant in Shari'ah law (i.e. the enclosure to the letter mentioned above).

(2) Please forward up-to-date evidence that your client is practising as a self-employed consultant accordingly and is earning sufficient profit from this self-employment to maintain and accommodate himself e.g. accounts for his business for the previous year and latest balance sheet with a copy of his tax return".

27. On 18 September 2001 the Respondent's solicitors replied and enclosed the letter of 20 June 2001 addressed to the Home Office and the Law Society. As regards the Home Office's request as set out at (2) above, the solicitors stated as follows:

"At this stage we are unable to provide our client's accounts for the business, balance sheet or tax return.

Since obtaining permission to practise from the Law Society and the appropriate visa from the Home Office last year, our client has commenced actions with a view to establishing a business.

For example, he has undertaken extensive building work at his home address to build an office, and we enclose a copy of the building plans for your reference.

He has arranged for his practice to be advertised with various institutions in Saudi Arabia together with the Saudi Arabian Embassy in London (letter enclosed for your reference).

He is currently seeking an appointment with a bank to organise the opening of a business account together with instructing a suitable accountant to be responsible for his business accounts.

He has received a number of telephone enquiries from persons seeking his advice (referred to him from the Embassy) whom he has assisted with general advice. No charge for this advice has yet been made until his business is fully running, together with his opinion that these pro bono advices shall lead to more goodwill and advertisement of his services for the future building of the business.

As we are sure that you will appreciate, such a niche area of practice will take time to establish itself, although our client is confident that in time for next year's renewal, he shall be able to produce some form of business accounts.

With respect to the requirement that our client is able to accommodate and support himself and his family without recourse to public funds, we are sure that the bank statements previously provided to you shall confirm that our client's financial circumstances allow him to comfortably support himself and his family. In due course he hopes that the income generated from his business will in itself be sufficient for accommodation and support of him and his family.

We trust that the information provided in this letter is in satisfaction of your request, and that our client's application for an extension to his leave to remain in the UK shall be favourably concluded".

28. The point about the above reply is that it did not provide the information that was specifically required under the provisions of not least paragraph 206(ii) of HC 395.
29. We would however clarify that as pointed out by Mr. Muquit, the Respondent as an overseas lawyer was not required to show that he had invested not less than £200,000 of his own money directly into the business in the United Kingdom. However it is apparent that he was not providing audited accounts that showed the precise financial position of the business.
30. Mr. Muquit submitted that that these requirements should have been reasonably foreseeable as being met on the part of the Secretary of State in that as the Adjudicator had noted from the bundle of documents before him:

"The first trading period dated 14 December 2001 were prepared ready to be approved by the Appellant which is a matter of only 6 weeks after the date of refusal and 12 weeks after the deficient reply from the Appellant's solicitors".

31. Mr. Muquit maintained that the Secretary of State had failed to place matters in their historical context. This was not, he submitted, an application in isolation. The Respondent had arrived in this country following the grant of a student visa and had subsequently made a successful application under the Rules to conduct a business as a self-employed lawyer, a consultant in Sharia law, that had been granted for twelve months on 12 July 2000. The fact that the Respondent met all the requirements of those particular Rules in order to obtain such entry clearance should have been a factor which the Secretary of State could have taken into account. Further, Mr. Muquit argued, Rule 206 only required that the Respondent could show for example, audited accounts, not that they should actually be produced in support of the application.
32. We were not persuaded by those submissions. Indeed with respect to Mr. Muquit, it flies in the face of commonsense to suggest that "show," means an ability to produce required evidence under the relevant Rule at some indeterminate date in the future. Were that to be so, it would frankly make nonsense of the Rules. We conclude this is not a case that relates to future intentions. Rule 206 obligates the applicant to produce the required evidence at the time of the application.
33. Indeed this was directly observed by the Adjudicator when at paragraph 19 of his determination the Adjudicator continued as follows:

"I suspect those accounts were in the process of being prepared by the Appellant's accountants at the time the solicitors wrote to the Respondent in September and had the solicitors informed the Respondent of this with a request to defer a decision for a short time pending production of the accounts it would have been granted. Had this been done it is likely the application for extension would have been granted and the Appellant would have been spared the anxiety and expense of this appeal".

34. He was therefore correct in continuing at paragraph 20 of his determination as follows:

"I am satisfied as a fact that due to the solicitor's default the Appellant failed to comply with the requirements of paragraph 206(ii) and that the Respondent was entitled on the evidence before him at the date of decision to refuse the extension requested on that ground".

35. It was Mr. Trent's submissions with which we entirely concur, that at that stage of the determination it only remained for the Adjudicator to dismiss the Respondent's appeal and his failure to do so and even worse to allow the appeal not on legal principles but for reasons of pragmatism was a clear and material error of law.
36. Rule 206 requires there to be a pre-existing business with audited accounts. If they are not there then the Rules are simply not met. The Secretary of State had asked for further information to facilitate the application but it was not provided. Insofar as Rule 208 is concerned we reject Mr. Muquit's submission that it is implicit within the Rule that the Secretary of State has a discretion that he may exercise. The Rule is clear. It does not disclose a discretion. Either the Secretary of State is or is not satisfied that the requirements of Rule 206 are met. To be satisfied is a matter of fact and not a matter of discretion. The Rule is clear:

"208. An extension of stay in order to remain in business is to be refused if the Secretary of State is not satisfied that each of the requirements of paragraph 206 is met".

In this case for reasons which were abundantly obvious, the requirements of Rule 206 were not met and the Secretary of State therefore properly refused the application in compliance with the Rules.

37. Mr. Muquit had referred us to the decision of the Tribunal in CA (Date of decision - Evidence) Nigeria [2004] UKIAT 00243 where at paragraph 7 the Deputy President Mr. C.M.G. Ockleton had stated inter alia:

"In assessing the circumstances at any particular date in the past, it is right to look at evidence subsequent to that date, provided that the evidence is relevant to assessing what the circumstances were on that date. This is a rule of commonsense as well as being a very well-established rule of law - so well established that no authority is necessary, although perhaps R v IAT ex parte Kotecha [1982] Imm AR 88 will serve."

38. With respect to Mr. Muquit what he fails to appreciate is that the circumstances in this case were that the Respondent was unable to comply with the mandatory requirements of the relevant Rule in that inter alia he was unable to produce audited accounts. The Secretary of State could not have considered it reasonably foreseeable even if, as Mr. Muquit contends and as found by implication by the Adjudicator, the solicitors had failed to make entirely clear the applicant's position, namely that it is claimed by the solicitors in the grounds of appeal:

"In the first year of business, from July 2000, (the Respondent's) accountants are not required to submit a tax return with audited accounts until January 2002. Therefore, such audited accounts were not available at the time of submission of the application for an extension of his leave. This was explained and should have been accepted as a reasonable explanation".

39. However as the Adjudicator rightly observed at paragraph 18 of his determination:

"Whilst I accept this is an adequate explanation for the non existence of a tax return it is wholly inadequate with regard to non provision of audited accounts and displays a fundamental failure by the solicitors to distinguish between fiscal and immigration requirements. Paragraph 206(ii) of HC 395 makes it abundantly clear that for immigration purposes an application to extend leave to remain has to be supported by audited accounts. This has nothing to do with the Inland Revenue taxation requirements to which different provisions apply and the (Respondent's) solicitors' failure to understand the difference has placed the (Respondent) and his family in grave danger of having the present appeal refused as it is manifestly plain the (Respondent) has failed to comply with paragraph 206(ii)".

40. Mr. Muquit further referred us to the decision of the Tribunal in SS Malaysia [2004] UKIAT 00091 that held inter alia that in relation to events that took place after a decision had been made the correct reasoning to apply to section 65 appeals was that set out in Kotecha, namely that the question of whether an entry clearance decision was in accordance with the law, was to be determined by the circumstances prevailing at the time of the ECO's decision. There might however be instances where post-decision events would be admissible where for example such events would illuminate what had previously occurred or related to events that were reasonably foreseeable at the date of decision.
41. We now deal with the question of reasonable foreseeability and post-decision evidence. The position at the date of decision in this case was that this Respondent was unable to meet the requirements of the Rules. The fact that he might have been able to do so at a later date is irrelevant.
42. Further and as we pointed out to Mr. Muquit, paragraph 2 of the Immigration Rules HC 395 state as follows:

"Immigration Officers, Entry Clearance Officers and all staff at the Home Office Immigration and Nationality (Directorate) will carry out their duties without regard to the race, colour or religion of persons seeking to enter or remain in the United Kingdom (and in compliance of the provisions of the Human Rights Act 1998)".

There is nothing about the requirements of Article 8 of the ECHR that negates the need for this Respondent to comply with the requirement of the Immigration Rules as regards the production of audited accounts that had to be produced at the time the application was made.

43. Article 8 is not there to permit a claimant to opt out of the requirements of the Rules on the basis that had his application been made at a later date he would have been able to meet the requirements of the Rules.
44. We are mindful, as indeed was the Adjudicator, that the claimant had been lawfully in the United Kingdom and had attempted to secure immigration permission lawfully to operate his business and that he and his family were "well integrated in the United Kingdom and have been here for 8½ years". Further that the claimant was as found by the Adjudicator to be a highly educated and well qualified man offering a specialised service not readily available from others. However, the Respondent failed to produce audited accounts, that being a significant feature of the application without which it could properly be said that the Respondent had not established his entitlement under the Immigration Rules for leave to remain. Therefore, if as in the case of this Respondent, he did not comply with the Rules, for a reason which could not be described as an insignificant non-compliance, we find that there is no reason why Article 8 should assist the Respondent to avoid the requirements of the Immigration Rules which are in themselves Human Rights Act compliant.
45. For the above reasons we find that the decision of the Secretary of State was in accordance with the law and the Immigration Rules applicable to this case. Further the decision of the Secretary of State did not place the United Kingdom in breach of its obligations under Article 8 of the ECHR.
46. We therefore allow the appeal of the Secretary of State.

Approved for electronic distribution.

N.H. GOLDSTEIN

VICE PRESIDENT