SCTSPRINT3
Home / Search Judgments / Judgment
 

PETITION OF VIKRAM FOODS GLASGOW LIMITED FOR JUDICIAL REVIEW

OUTER HOUSE, COURT OF SESSION

[2016] CSOH 77

 

P795/15

OPINION OF LORD BANNATYNE

In the petition of

VIKRAM FOODS GLASGOW LIMITED

Petitioners;

for

Judicial Review of the decision of the Secretary of State made on 5 March 2015 to refuse to grant the petitioner’s application made on 6 January 2015 for a Tier 2 General and Tier 2 ICT Sponsor Licence

Respondents:

Petitioners:  J Bryce; Drummond Miller LLP

Respondents:  G Maciver; Office of the Advocate General

8 June 2016

Introduction

[1]        The petitioners are a company formed on 25 June 2014.  It has two outlets, both Indian restaurants trading as Rishi’s Indian Aroma, one having a registered company address at 61 Bath Street, Glasgow and the other at 11 Hawkhill, Dundee.  The owners of the company are members of the same family as the owners of Vikram Restaurants Limited, India. 

[2]        The petitioners made an application on 6 January 2015 for a Tier 2 General and Tier 2 (ICT) sponsor licence.   The application was refused by the respondent in terms of a decision letter dated 5 March 2015.  The present judicial review proceedings sought reduction of that decision.

 

Regulatory background

[3]        Where an employer requires to employ non-EEA nationals in his business in the United Kingdom he has to obtain a sponsorship licence from the respondent. The sponsorship scheme is not statutory but is rather subject to departmental guidance.  Said guidance is contained in a document issued by the respondent, namely: “Tier 2 and 5 of the Point Based System Guidance to Sponsors”. 

[4]        The material provisions for the purpose of these proceedings are these:  once a licence is in place, an employer can recruit non-EEA nationals, subject to the RLMT, other than for jobs exempt from the RLMT (see: paragraph 28.1 of the Guidance).   “Skilled chef” is an exemption listed on the Tier 2 Shortage Occupation List under reference SOC5434.  The sponsorship scheme also permits intra-company transfer (“ICT”)       for circumstances in which a company with operations both in the United Kingdom and outside the EU can “transfer existing employees from outside the EEA to their United Kingdom branch for training purposes or to fill a specific vacancy that cannot be filled by a British or EEA worker” (Immigration Rule 245G).  The guidance at paragraph 4.2 makes it a pre-requisite of an ICT licence that there should be demonstrated a direct link by common ownership or control with the overseas entity.  Appendix A to the guidance specifies documentation that must be submitted in support of an application for an ICT sponsorship licence.  One route specified in the appendix to substantiation of an application is the provision of a “certified copy of the joint venture agreement naming both entities as parties or one entity as a party and the other entity as the entity formed by that agreement (see:  Table 3)”.

The petitioners’ application in terms of the points based system
[5]        The petitioners’ application under Tier 2 (ICT) was to bring over a managing director for training purposes.  In terms of Tier 2 (General) the petitioners sought to recruit a specialist chef. 

 

The respondent’s decision letter

[6]        The material parts of the decision letter for the purposes of these proceedings are as follows:

“Decision and Rating

 

Thank you for your application to become a licence sponsor under Tier 2 (General) and Tier 2 (ICT) of the points based system.

 

From the evidence provided and/or following the meeting between you and one of the compliance officers on 17 February 2015, we are not satisfied that you can offer genuine employment that meets the Tier 2 (General) requirements on skill level and/or the appropriate rates of pay for the following reasons:-

 

Tier 2 (General) – business development manager

 

You operate an Indian restaurant based on the nature and size of your organisation and the evidence received, we do not consider that this business supports the role of a full time business development manager or that there is a genuine need for the role of business development manager as described.

 

Indeed there is no shortage of individuals with the skills needed to undertake the role of business development manager in the UK.  We would expect businesses, such as the one that you operate to fill any vacancies you may have by recruiting personnel from the resident or European economic area workforce, who are not subject to immigration control.

 

Tier 2 (ICT) – Speciality Chef

 

You have submitted a joint venture agreement dated 22 November 2013.  Vikram Foods Glasgow Limited was incorporated as a company in the United Kingdom on 26 June 2014.  We do not accept therefore that the joint venture agreement document that you have submitted demonstrates that a bona fide joint venture for ICT purpose indeed exists.  It appears that the document has been produced in order to try and meet the Tier 2 Intra-Company Transfer sponsorship rules. 

 

Furthermore, the searches we have undertaken in relation to the business that is operating in India, appear to show that this is a fast food outlet, which leads us to question whether or not such a business could supply speciality chefs to the level that you state you require.  This view is reinforced by the list of duties that was provided by your representative in his letter of 2 March 2015, in which they outline the duties that a chef employed by you would have to undertake.

 

i.          Identification of current and future customer food preferences.

ii.         Plan menus by studying market conditions

iii.        Prices meals by analysing recipes.

iv.        Controls costs by using seasonal ingredients.

v.         Maintains professional and technical knowledge by attending educational workshops.

vi.        Maintaining first aid, CPR and Heimlich manoeuvre certification.

 

We are therefore not satisfied that the chef that you are looking to recruit from India, would possess the necessary high level of skills and experience that you state you need, namely NQF Level 6.

 

…..

 

If you re-apply you should ensure that the reasons for refusal outlined above no longer apply or your application is likely to be refused again”.

 

 

Preliminary issue

[7]        Before turning to the detailed arguments with respect to the substantive issues it is appropriate to deal with a preliminary matter raised by the respondent.

[8]        Counsel for the respondent’s broad position was this:  that there was an alternative remedy available to the petitioners and therefore either the court should decline to exercise its supervisory discretion and dismiss the petition or the court should use its discretion to refuse to pronounce the remedy sought.

[9]        In support of the above general proposition counsel directed my attention to Clyde & Edwards Judicial Review at paragraph 12.01 where the authors say this:

“As a general proposition it may be said that judicial review is not available if there is an alternative means of relief open to the applicant.  One example of such a case is where there is a contractual remedy open to the complainer, but the matter of alternative remedies has usually arisen in relation to the provision of statutory remedies and it is with that problem that this chapter is particularly concerned.  Where a particular remedy is provided the general rule is that it must first be pursued.  This rule was recognised by Lord Kames when he observed that ‘it is the province, one should imagine, of the sovereign, and Supreme Court, to address wrongs of every kind, when a peculiar remedy is not provided’.  One may not neglect a statutory remedy and jump direct to the Court of Session.  Indeed, if the alternative statutory remedy is more suitable to the nature of the case and sufficiently obviates the risk of wrong or abuse, it may be exclusive or final.  The principle may be thus expressed in terms of an implied exclusion of the court, so that it can be said that where a statute provides an alternative method of review there is an implied exclusion of the jurisdiction of the Court of Session”.

 

 

[10]      Counsel accepted that no alternative statutory remedy was available in the present case.  Nevertheless, it was his position that there were alternative means of relief, namely:  the making of a fresh application.

[11]      Counsel referred me to a number of authorities namely:  ZG [2015] CSOH 159;  MDMH (Bangladesh) [2014] CSOH 143;  and King v East Ayrshire Council 1998 SC 182 on this issue:  if I found there was an alternative remedy available in the instant case should I dismiss the petition or refuse, in the exercise of my discretion, to pronounce the remedy sought.

[12]      On the basis of his analysis of these cases, counsel’s position was this:  he accepted that it was competent to bring the petition, given that there was no statutory appeal, however, there was another remedy available and thus no practical effect in reducing the challenged decision, therefore the appropriate course for the court was to exercise its discretion and refuse to pronounce the remedy sought.  In support of this, he directed my attention to the following passage in the Opinion of the Court in the King case at page 194:

“Even where a court is satisfied that an administrative body has erred in law in reaching their decision, the court is not bound to reduce that decision.  As Lord Halesham LC pointed out in London & Clydeside Estates Ltd v Aberdeen District Council at page 31, the jurisdiction to grant decree of reduction of administrative decisions is ‘inherently discretionary’.  In particular it is relevant for the court to consider what practical effect the person seeking reduction will achieve if the decision is reduced”.

 

 

[13]      In seeking to establish that an alternative form of relief was available, counsel referred me to the policy guidance at paragraph 10.4 which provides:

“If we refused your application for one or more of the reasons listed below, you should only reapply when 6 months have passed since the date of our letter notifying you of the refusal.  If you reapply before this date, we will refuse your application if our previous refusal was because:

 

  • You did not meet the requirements to be a sponsor in the category under which you applied;
  • You submitted false documents;
  • You did not have the processes necessary to comply with your sponsor duties;
  • You have an unspent criminal conviction for a relevant offence …..
  • You are legally prohibited from becoming a company director…..
  • You have no trading presence in the UK”.

 

 

[14]      The decision under review was dated 5 March 2015, and the service of the petition was on 5 August 2015.    As of 5 September 2015 it was open to the petitioners to reapply.  In these circumstances the respondent specifically undertook through counsel that:

“the decision would be taken afresh without regard to the previous decision and without regard to the previous application”.

 

 

[15]      It was counsel’s submission given the terms of 10.4 and the undertaking which he had given on the respondent’s behalf in court that there was no practical and no useful purpose served by the reduction sought.

[16]      Although counsel was prepared to give the above undertaking he also said this:  the respondent had made certain findings regarding the Joint Venture Agreement (“JVA”) in the challenged decision and it therefore followed that if that document were produced again as the basis for the application:  “Then it may well be that the same decision would be reached” by the respondent.

 

Reply for the petitioners to the preliminary issue
[17]      The reply was a short one:  the petitioners would in any future application seek to rely on the same JVA and therefore any future application would be refused.  Thus the petitioners were under necessity of applying to have the challenged decision reduced.

 

Discussion

[18]      I am persuaded that there is a practical purpose in the petitioners seeking reduction of the challenged decision.

[19]      The petitioners do not accept that the JVA does not demonstrate a bona fide joint venture.  If the petitioners were to make a fresh application for an ICT licence they would seek to rely on that document.  The inevitable result of their reliance on that document, given the respondents earlier findings with respect to it in the challenged decision letter, would be the refusal of the application.  This was in effect accepted by counsel for the respondent in the course of his oral submissions.  That such would be the result of a new application based on the JVA is foreshadowed in the decision letter where this is said:

“If you reapply you should ensure that the reasons for refusal outlined above no longer apply or your application is likely to be refused again”.

 

[20]      Accordingly in my view the practical result which would be achieved, were the initial decision letter to be reduced, would be that the new application by the petitioner based on the JVA would have to be looked at entirely afresh (as if the previous decision had not been made) and any decision could not be founded upon the basis of the respondent’s previous decision.

[21]      For the above reasons I reject the respondent’s preliminary argument and repel her third plea-in-law.

 

The substantive argument

The submissions on behalf of the petitioners

[22]      Counsel began by addressing me as to the legal context in which the sponsorship licence scheme exists.  This had been examined by the Supreme Court in R (NLC Limited) v SSHD 2013 1 WLR 2358 and he in particular drew my attention to the judgment of Lord Sumption at paragraphs 28 and 29.  From the foregoing section of Lord Sumption’s opinion he submitted that the following could be taken:  immigration rules made under the Immigration Act 1971 permit of the grant of leave to enter or remain to persons subject to immigration control.  The part of the rules which creates the point based scheme for workers (Tiers 2 and 5) or students (Tier 4) specify that leave for persons qualifying thereunder should be contingent upon their having a sponsor, an employer where the immigrant is coming here to work or a university or college when they are coming here to study.  The respondent is then entitled to take administrative measures for identifying sponsors.  The right is not unlimited.  The respondent cannot without specific statutory authority adopt measures for identifying sponsors which are inconsistent with the Act or with the Immigration Rules, which infringe the rights of others, or are irrational or unfair or otherwise conflict with the general constraints on administrative action imposed by public law.  One of these general constraints is the principle that where a public authority has issued a promise or adopted a practice which represents how it proposes to act in a given area, the law will require the promise, or practice to be honoured unless there is good reason not to do so;  AA & Others (Highly Skilled Migrants – Legitimate Expectation) (Pakistan) 2008 UKAIT 0003 at paragraph 68).

[23]      Counsel then argued that in the instant case the petitioners had a legitimate expectation that the respondent would act in accordance with her own guidance.  It was his broad submission that she had not so acted.

[24]      In development of the above position there were three detailed chapters to the petitioners’ argument.

[25]      One, the guidance admits of the possibility of intra-company transfers.  The idea is that a business with a partner outwith the UK can in circumstances set out within the guidance apply for a licence under the scheme to have a member of staff from the overseas operation come to this country.  The respondent’s position was that she did not believe that the petitioner had satisfied the ICT guidance.  Her decision with respect to this was perverse.

[26]      Secondly the condition which the respondent had sought to impose with respect to the application for a specialist chef namely that the chef could only come from the other party to the JVA’s business in India was not a requirement in terms of the guidance.

[27]      Thirdly, moreover, the respondent had made it a pre-requisite of having a specialist chef that the person who the petitioners wished to have as a specialist chef should be identified prior to the application and named therein.  That he argued was equally not a part of the guidance.  In addition it was stated in the decision letter that the chef required to have a skill level of NQF 6.  This was wrong.

[28]      Counsel made two preliminary points with respect to the decision letter:

  • The letter refers to the petitioners seeking in terms of its Tier 2 (General) application to have a business development manager.  No such application for a business development manager was made.
  • Under the heading “Tier 2 ICT speciality chef” the respondent referred to the JVA not satisfying the Tier 2 intra-company transfer sponsorship rules.  The application for a speciality chef was not made in terms of the Tier 2 intra-company transfer sponsorship rules. 

[29]      Then turning to develop the first chapter of his submission, he argued this: the main basis of the respondent’s decision was the view that she arrived at regarding the JVA (it did not reflect a bona fide joint venture) and this was set out in the first paragraph at page 2 of her decision letter (as earlier set out in this opinion).  This view was arrived at solely on the basis of a wrong date in the JVA.

[30]      The background to this as explained by counsel was that the error regarding the date was no more than a typographical error which on being recognised by the petitioners and their advisers was immediately drawn to the respondent’s attention and a corrected version of the document was submitted.

[31]      He submitted that against the foregoing background it was perverse for the respondent to hold that the JVA did not reflect the true position.

[32]      He went on to say this:  it seemed to be argued by the respondent in her answers that even if the JVA did properly reflect the true position the respondent was still entitled to reject the application as not having been submitted in accordance with the guidance in that it was not correctly submitted at the same time as the rest of the application.

[33]      Counsel’s reply to this point was short:  for the respondent to reject the JVA which she had had from 9 January when the initial application was originally submitted only three days earlier neither met the fairness or common sense test in Pankina v SSHD 2012 [UKSC] 33. 

[34]      It was his submission that in applying the guidance in this way the respondent’s position was neither reasonable nor rational.  This submission was made under reference to the Supreme Court decision in Mandalia v SSHD 2015 [UKSC] 59.

[35]      Turning to the second chapter of his submissions in summary it was this:  rejection of the Tier 2 (General) application was irrational and unreasonable.  The petitioner had not sought a licence for sponsorship for a specialist chef under ICT, and so the issue of whether or not the Indian business was capable of providing such an employee was irrelevant.

[36]      The third chapter of the petitioner’s submissions was in respect of that part of the respondent’s decision where it was held that in order to have a Tier 2 sponsor licence granted for a speciality chef it was necessary for the petitioner to identify within the application the person it contended met the criteria.  This position was taken not only in the decision letter but also in the reply to the pre-action protocol letter (6/10 of process) at page 2 in the final paragraph.

[37]      The petitioner’s position was that the above was a misunderstanding of the sponsor guidance.  Counsel submitted that a correct analysis of this guidance was as follows:  in terms of paragraph 24.7 – 24.10 of the guidance, Tier 2 sponsor posts have to be at skill levels corresponding to NQF 6, subject to certain exceptions.  One of those exceptions, he accepted, was where the recruit was identified in advance (see: paragraph 24.8(d) and (e) of the guidance).  However, another exception was where the position was on the current list of shortage occupations.  A specialist chef was one of those positions;  reference was made to the current shortage occupation list.  In development of that submission he submitted that this was the basis upon which the petitioners’ application was made.  In their application of 2 March 2015 considerable effort had been made to relate the description of the post they wished to fill to the description on the shortage occupation list.  The imposition of the requirement of prior identification of the recruit was accordingly an imposition of an obligation that did not appear on the guidance and as such contravened the petitioner’s legitimate expectation.  Moreover, in the Codes of Practice for Skilled Workers (SOC) Codes chefs at 5434 have to be skilled to NQF Level 3 not 6.

 

Reply on behalf of the respondent
[38]      With respect to whether the respondent had considered the petitioner’s applications in terms of the appropriate guidance either Tier 2 (General) or Tier 2 (ICT) counsel accepted that on the face of the decision letter it appeared that each part of the petitioner’s application had been considered in terms of the wrong part of the guidance.  However, he submitted that this was no more than an issue of terminology and did not go to the substance of the consideration of the issues by the respondent.  His position was that the decision in substance remained correct and no error of law was shown.

[39]      With respect to the perversity argument, it was his position that this did not get off the ground.  It was his submission that the letter from the petitioners’ solicitors regarding the typographical error in the JVA document had been considered as was clear from the following passage in the response to the pre-action protocol:

“In relation to the Tier  2 (ICT) application you state: ‘the decision makers refusal to accept the applicants explanation that the date on the (JVA) was due to a typographical error is perverse and irrational and a copy was also provided to Lorraine’.

 

We stated in our refusal letter: ‘You have submitted a Joint Venture Agreement dated 22 November 2013.  Vikram Foods Glasgow Ltd was incorporated as a company in the United Kingdom on 26 June 2014.  We do not accept therefore that the joint venture agreement document that you have submitted demonstrates that a bona fide joint venture for ICT purposes indeed exists.  It appears that the document has been produced in order to try and meet the Tier 2 Intra Company Transfer sponsorship rules’.

 

We made this assessment based on the fact that the document had been written up prior to the company in the UK existing.  You have challenged this by stating that the 2013 date was a typographical error, and that the actual date of the joint venture agreement was 2014.  However, the agreement submitted with the application, was certified by you and declared that the document was an accurate copy of the original.  Therefore, we do not accept your assertion that there was a typographical error, and maintain our position that it appears that the document was produced in order to try and meet the Tier 2 Intra Company Transfer sponsorship rules”.

 

 

[40]      Counsel submitted that the respondent was entitled having had regard to the petitioners’ letter explaining the typographical error to take the view that it was not a bona fide JVA and that it did not reflect a genuine state of affairs.  The onus was on the petitioner to provide proper and accurate documentation.  It was legitimate for the respondent to take the inference from such a fundamental error within a document of this type that it did not reflect the true position.

[41]      Against that background the decision of the respondent was a reasonable one.

[42]      Turning to the arguments regarding the speciality chef part of the application counsel conceded that the decision letter was wrong in stating that the skill level of the chef had to comply with NQF Level 6.

[43]      In addition, as I understood it, he accepted that the letter was equally wrong in holding that a chef had to be identified in the application and supplied from the connected business in India.

[44]      The only matter which counsel sought to argue was this:  the description supplied by the petitioners did not meet the criteria of what is defined as a speciality chef in terms of the Codes of Practice for Skilled Workers (SOC) Codes at paragraph 5434 which provides:

 

“Chefs

 

Example job tasks:

 

  • Requisitions or purchases and examines foodstuffs from suppliers to ensure quality;
  • Plans menus, prepares, seasons and cooks foodstuffs or oversees their preparation and monitors the quality of finished dishes;
  • Supervises, organises and instructs kitchen staff and manages the whole kitchen or an area of the kitchen;
  • Ensures relevant hygiene and health and safety standards are maintained within the kitchen;
  • Plans and co-ordinates kitchen work such as fetching, clearing and cleaning of equipment and utensils.

 

Related job titles:

 

  • Chef
  • Chef-manager
  • Head chef
  • Pastry chef

 

Only the following job titles in this classification are skilled to NQF level 3 (all others are lower skilled and therefore ineligible):

 

  • Skilled chef jobs where the pay is at least equal to the appropriate salary rates shown and the job requires three or more years relevant experience.

 

Salary rates:  All rates apply after deductions for accommodation, meals etc.  Any overtime must also be paid at least at these rates.

 

*Skilled chef as defined in the Shortage Occupation List:  £29,570”.

 

 

[45]      He submitted that the foregoing was not met on the application.

[46]      He submitted that though the respondent had referred to NQF Level 6 in her decision letter she must be taken to know her own guidance and must have had regard to this and thus in substance the decision was correct.

 

 

Discussion

[47]      It was accepted on behalf of the respondent that on the face of the challenged decision letter the Tier 2 (General) application had been considered as if it were a Tier 2 (ICT) application.  Moreover in the decision letter reference was made to a business development manager where no such application was made.  Beyond that the decision letter referred to (a) a skill level of NQF 6;  (b) a necessity to identify the chef at the time of the application and (c) a requirement that the connected business in India should supply that chef.  All of the above were accepted by counsel for the respondent to be incorrect.  I am satisfied that these errors are not merely errors in terminology.  They are rather errors which go to the core of the decision.

[48]      The mistakes show a very careless approach by the respondent to the application.  They show a complete failure either to examine properly the application or a complete failure to understand the basis upon which the application was made.  They show a failure to understand the legal framework in terms of which the decision was being made.  They show a failure to separate the two parts of the application made by the petitioner and to consider these separate parts in terms of the correct legal framework.

[49]      I hold, without difficulty, that the above errors amount to a material error of law which justify the reduction of the decision letter.

[50]      The core of the respondent’s decision was her conclusion that the JVA did not constitute evidence of a bona fide joint venture.  I am, without difficulty, persuaded that this is a view which the respondent was not entitled to reach on the basis which she sets out in the decision letter.  Within the decision letter she sets forth no basis upon which she arrives at the conclusion that the only explanation for the wrong date appearing within the JVA is that it does not reflect a true position.  There are undoubtedly other possible explanations for such an error, however, there appears to be no consideration of such.  In particular there is the explanation which was tendered on the petitioners’ behalf, almost immediately after the submission of the JVA.  There is nothing within the decision letter to show that that explanation was given any consideration by the respondent.

[51]      In seeking to advance an argument that the explanation given by the petitioners was considered by the respondent, counsel for the respondent took me to the reply to the pre-action protocol letter.  First, on a fair reading of this section of the letter to which he took me, it does not demonstrate that in coming to the challenged decision the explanation put forward on behalf of the petitioner was considered.  Rather it appears that it was only in response to the pre-action protocol letter, where the issue of the typographical error is again raised, that for the first time the respondent has considered the petitioners’ explanation for the error.

[52]      In any event I do not believe it appropriate that reference is made to the respondent’s response to the pre-action protocol letter in support of an argument that the decision letter evidenced a basis upon which the respondent was entitled to hold that the JVA did not represent the true position.  In my view what must be had regard to when considering whether the respondent was entitled to reach that decision is the terms of the decision letter itself.  As I have already said within the decision letter itself there appears to be no consideration of the position put forward on behalf of the petitioners.

[53]      Moreover, nor are there any reasons within the decision letter, if the explanation of the petitioners was considered at all, as to why that explanation was not found to be acceptable.  The mistake in the JVA was immediately drawn to the respondent’s attention by the petitioners.  On the face of it that would be an extremely odd thing for the petitioners to do, if the respondent is correct that the JVA is fraudulent.  It is proper to ask this question:  given the explanation put forward on behalf of the petitioners, why in terms of the challenged decision is the explanation rejected?  No answer to that question is given having regard to the terms of the decision letter.  Nor, even if it is proper to take into account the reply by the respondent to the pre-action protocol letter is there any explanation given as to why that explanation is rejected.

[54]      Beyond the above it appears to me that there is no proper basis for the inference which the respondent takes from the wrong date in the document, namely:  that it is a fraudulent document.  There would, I am persuaded, need to be more than a mere error in the date for the respondent to properly infer that the document did not reflect a true position.  That must be particularly true where a tenable explanation has been proffered by the petitioners before the error has even been noted by the respondent.

[55]      I am clearly of the view that the respondent’s position regarding the JVA was one which she was not entitled to reach.  In my view the decision which she reached regarding this was perverse.  I am of the view that this clearly amounts to a material error in law.

[56]      Lastly the description supplied by the petitioners in all material respects matches the criteria set out in the Code. In summary the decision letter is one which is:  riddled with errors;  the reasoning contained within it does not entitle the respondent to reach the decisions which she did;  the respondent has misdirected herself in material respects with reference to her own guidance and codes.  In these circumstances I without difficulty believe that this is a decision letter which cannot properly stand.

 

Decision

[57]      For the above reasons I uphold the petitioners’ pleas-in-law;  repel the respondent’s pleas-in-law and reduce the decision letter.