England and Wales Court of Appeal (Civil Division) Decisions

IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION, ADMINISTRATIVE COURT
Deputy Judge Helen Mountfield QC
CO/10639/2013

		Royal Courts of Justice Strand, London, WC2A 2LL
		18/11/2015

Lord Justice McCombe:

(A) Introduction

1. On 4 November 2015 we heard applications by the respondent to the pending appeal in this case for orders setting aside the grant to the appellants of permission to appeal and, in the alternative, granting to the respondent an extension of time for the filing and service of a respondent's notice.
2. By order of Vos LJ made on considering the papers on 30 April 2015 the appellants were granted permission to appeal from the order of 10 February 2015 of Ms Helen Mountfield QC (sitting as a Deputy Judge of the High Court). By her order the judge dismissed the appellants' applications for judicial review of decisions of the respondent which had refused them leave to remain in the United Kingdom as "Tier 1 (Entrepreneur) Migrants" under the "Points Based System" in Part 6A of the Immigration Rules.
3. Before turning to the facts of the case and the history of the proceedings more fully, it is useful to summarise the issues before us. The respondent contends that Vos LJ was persuaded to grant permission to appeal on what is said by the respondent to be a misapprehension (induced by the appellants) of the true basis of the claims as advanced by the appellants before the judge. Accordingly, the respondent argues that this is one of the exceptional cases in which a grant of permission for an appeal should be set aside under CPR 52.9(1)(b). The appellants say that the permission to appeal was properly granted, the permission should not be set aside and that the respondent should not be permitted to file and serve the proposed respondent's notice out of time.

(B) The background facts

4. The factual background to the proceedings is set out in paragraphs 1 to 6 (inclusive) of the judge's judgment, to which the neutral citation reference is [2015] EWHC 264 (Admin). What follows is a summary of what the judge said in that part of her judgment.
5. The appellants had leave to remain in the United Kingdom which expired on 20 September 2012. On 21 September 2012 they submitted applications for further leave to remain. If they had applied on or before 20 September, the applications would have operated to extend the leave to remain until after the applications had been determined. The appellants blamed negligence on the part of immigration advisers for the delay. Notwithstanding the fact that the appellants were, therefore, technically "overstayers", the respondent proceeded to deal with the cases on their merits.
6. To satisfy the requirements of the rules and to lead to a grant of leave to remain in the relevant category of migrant, the appellants were required to achieve a certain number of "points" according to criteria designed to demonstrate that they were operating, or were to operate, a viable business in this country. They needed to show access to adequate funding. Further, under paragraph 41–SD(c)(iii) and (iv) of Appendix A to the Rules, which were of particular relevance in this case, the appellants had to submit the following:

(A)

"(1) Advertising or marketing material, including printouts of online advertising, that has been published locally or nationally, showing the applicant's name (and the name of the business if applicable) together with the business activity;

(2) Article(s) or online links to articles(s) in a newspaper or other publication showing the applicant's name (and the name of the business if applicable) together with the business activity;

(3) Information from a trade fair(s) at which the applicant has had a stand or given a presentation to market his business, showing the applicant's name (and the name of the business if applicable) together with the business activity, or

(4) Personal registration with a trade body linked to the applicant's occupation."

(B)

"... one or more contracts showing trading. If a contract is not an original the applicant must sign each page of the contract. The contract must show:

(1) the applicant's name and the name of the business;

(2) the service provided by the applicant's business; and

(3) the name of the other party or parties involved in the contract and their contact details, including their full address, postal code, landline phone number and any email address"

The judge called these requirements, appearing in sub-paragraphs (iii) and (iv) respectively, "the genuine business requirement" and "the contract details requirement".

7. The respondent refused the applications on 7 and 8 May 2013, in identical terms in the case of each of the appellants. In respect of the requirements of the Rules, the respondent found that the advertising material submitted, in purported satisfaction of paragraph 41-SD(c)(iii), did not include the nature of the business and the link to the appellant's names and found that the contractual material, submitted to meet paragraph 41-SD(c)(iv), was deficient, in that it failed to supply the mandatory "landline" telephone number for the contracting party.

(C) The proceedings in the High Court

8. The appellants sought to challenge the respondent's decisions by judicial review. The Amended Grounds of Claim, in the case of each appellant, presented the challenge on the basis of the alleged irrationality of the two sub-paragraphs of the Rules to which I have referred and on the basis of a failure by the respondent to apply "evidential flexibility" to the applications, in so far as technically deficient, under Rule 245AA of the Immigration Rules. It was not suggested anywhere in those Grounds that the material submitted to the respondent in support of the applications actually met the requirements of the Rules as drafted. The Amended Grounds in each case sought declarations that the relevant paragraphs of the Rules were irrational, quashing orders in respect of the decisions made and a mandatory order for reassessment of the applications. As the case was opened by Mr Saini for the appellants before the judge, he said,

"The issue of course before you today is as to the rationality of the rules…".

9. During the course of the hearing before the judge (of which we now have a transcript), Mr Saini began to refer to documentation appearing in the bundle. He appeared to be advancing a submission that the documentation submitted to the respondent with the applications had complied with the Rules. At that point, Mr Gullick intervened to say,

"I am sorry; this submission has taken me somewhat by surprise…The challenge that has been advanced by the claimants is of course two-fold; firstly that both the requirements that they failed to meet are irrational; and secondly, or in the alternative, that they should have been contacted in order to correct any errors under the [evidential] flexibility rules.

If it is now being submitted that the claimants in fact submitted material that satisfied the rules and therefore their applications ought to have been granted irrespective of any other matters, then as it were that is news to me".

10. To this, Mr Saini responded,

"I am grateful to my learned friend. I do apologise for the compilation of the bundle; it is somewhat out of my control, but I would simply observe that I believe the reason why this may be something which has not come to everyone's attention previously is because these documents do not appear to have been in the claim bundle (inaudible)".

Then the judge said,

"All right. What I propose to do, Mr Saini, is to hear your submissions on the law on those two grounds which are the grounds that I have understood and you and Mr Gullick can talk outside about what was in fact submitted and it may be that the documents exist which mean that your clients could meet that requirement anyway because they could submit them in a fresh application".

11. Stating shortly the judge's conclusions, she found that the genuine business requirement was rational and lawful. On that point she said this at paragraph 33:

"33. In my judgment, the evidential requirements of paragraph 41-SD(c)(iii) cannot be said to go beyond that which the Secretary of State may legitimately require for this purpose. That paragraph provides a range of types of evidence which can be provided to demonstrate these matters. One satisfactory form of proof is marketing material containing sufficient evidence of the genuineness of the business and of the entrepreneur's link to it. Marketing materials, which are within the applicant's own control, can reasonably be expected to explain (as required) what the business is, the business name and to demonstrate the link between the applicant or applicants and the business".

12. The judge found that in the light of her decision on the rationality of the genuine business requirement any observations that she made as to the contract details requirement would be obiter dicta because the appellants needed the points attributable under both heads to qualify and the failure of the challenge to the lawfulness of one of the two criteria in issue meant that the applications for orders quashing the refusals of leave to remain would have to fail. But, it is clear that she was inclined to the view that the "landline" requirement was irrational. She said this at paragraphs 36 and 37 of the judgment:

"36. I accept, on the basis of the observations of the Upper Tribunal in Shebl that the Secretary of State is entitled to require evidence of genuine trading, and must be entitled to require sufficient details of genuine contract or contracts to make enquiries if she wishes to do so. I accept that she has a wide discretion as to the means of doing this. I see the sense of requiring a physical address for such a client, to enable the genuineness of its existence to be checked easily if required. I see the sense of requiring some other form of ascertainable contact details.

37. However, I also accept the Claimants' argument that by making an absolute requirement that the client business must have a landline telephone and must contain details of it in the contractual documentation in order for that documentation to 'count' as proof of genuine trading, the Secretary of State has created an evidential rule which is partial between those who contract with a business which happens to have a landline (but need not have any mobile telephone or email details) and those who contract with a business which happens to have only a mobile telephone, (though also email details) or where the landline details can be supplied but are not included in the contractual documentation itself. I see no rational justification for that distinction. ... "

13. Before handing down judgment in the case, the judge had prepared a draft judgment which was submitted for the parties' suggestions as to minor corrections in the usual way. Paragraph 7 of the draft was in these terms:

"7. In respect of the requirements of paragraph 41-SD9(c)(iii) [sic] of Appendix A, points were not granted because the material which the Claimants had submitted with their application by way of advertising material in attempt to show that they were working, which constituted on-line advertising material, did not include the nature of the business linked to the Claimants' names. In fact, there is material in the bundle (such as business cards and a website entry) which in combination, do link the Claimants' names to the business and would – if they had been submitted – appear to have satisfied the requirements of paragraph 41-SD9(c)(iii)(1) [sic]. Whether this material was created after the application or before, it was not suggested that this was submitted at the relevant time, and it was not part of the case before me that the Defendant had erred by failing to accept that such material existed."

14. Mr Saini responded to this part of the draft as follows:

"Observation: I am bound to respectfully mention as a potential point of appeal that the evidence of what advertising material was submitted has been reversed and the opposite actually applies. It would appear the Court may have misunderstood the evidence submitted by the Claimants in this regard.

Clarification: The Claimants confirmed in their witness statements before the Court, that by way of advertising material, their OISC representative submitted printouts from their company website under cover of letter dated 19^th September 2012 [see Trial Bundle/Part1/A61 and A109-A111]. This evidence was supplemented by the submission of their leaflet and business cards under cover of letter dated 29^th March 2013 in response to an information request from the Defendant made to their OISC representative [see Trial Bundle/Part2/A34-A38] which took place before their applications were refused. At the hearing, confusion arose as to whether the online advertising material was in fact sent by their OISC representative but was omitted from consideration by the Defendant's Refusal Letters. That argument it is true to say was not pursued on their behalf^[1]. Nonetheless, the Claimants have always maintained that their leaflet and business cards were submitted and this is not in contention as those materials are clearly mentioned in the Defendant's Refusal Letters [see Trial Bundle/Part2/A17 and Trial Bundle/Part1/A15 respectively]. Therefore, the complaint in the Refusal Letter was that the advertising material did not state the nature of the Claimants' business related to leaflet, not the website (as wrongly stated in the draft judgment) and it was additionally complained by the Defendant that the advertising material did not state the names of either Claimant.

Conclusion: Therefore, the evidence proven to have been submitted consist [sic] of the business cards and leaflet and consideration still needs to be given as to whether these materials in combination link the Claimants' names to the business. Consequently, I am obliged to state that it is not clear why Ground 2 fails based on current reasoning".

15. Mr Gullick responded:

"I am conscious that the opportunity to submit post-judgment corrections is not meant to engender further argument between the parties and so have not at this stage responded to Mr Saini's 'observations as to outstanding matters'. If the Deputy Judge wants the Secretary of State to respond to Mr Saini's observations please do let me know".

16. Apparently as a result, the judge added to and amended her draft paragraph 7 of the judgment so that the final version added this after the words "…appear to have satisfied the requirements of paragraph 41-SD9(c)(iii) [sic]":

"Counsel for the Claimant did not appear to have full instructions on what had been submitted by the OISC representative at the relevant time, and in observations on the draft judgment (received the day before the judgment was due to be handed down, and too late for me to seek observations from counsel for the Respondent), has raised observations about what was or was not submitted. I am not in a position to decide what of the evidence in the bundle before me was submitted at the relevant time, but in any event, understood the claim to be based on a submission as to the legality of the rules. Counsel for the Claimant did not advance an argument that it had been Wednesbury unreasonable for the applications to be refused based on the Secretary of State's own interpretation of the Immigration Rules".

(D) The application for permission to appeal to this court

17. By Appellant's Notice of 2 March 2015 the appellants sought permission to appeal from the judge's order dismissing their claim for judicial review. The Grounds of Appeal annexed to the Notice were in these terms:

"SUMMARY OF GROUNDS OF APPEAL

The Appellants respectfully submit that the Deputy Judge has committed a material error of fact in her judgment, concerning Ground 2 below. This error renders the judgment liable to be quashed for unlawfulness and unfairness, pursuant to E v Secretary of state for the Home Department [2004] EWCA Civ 49 and R (Alconbury Ltd) v Secretary of State [2001] UKHL 23.

The Appellants ask the Court to note that whilst Ground 2 was unsuccessful below, Ground 1 fell to succeed in theory given that the immigration rule in question was deemed to be ultra vires.

But for Ground 2's erroneous failure (given that the Deputy Judge made clear findings that the immigration rules were ultra vires on Wednesbury irrationality terms), the Appellants would have succeeded on Ground 1.

Consequently, the Appellants request this Court to quash the judgment in relation to Ground 2 due to a material error of fact, but to uphold the judgment in relation to Ground 1, which findings should form part of a substantive judgment and result in the Appellants' resultant success on both grounds.

CONCLUSION

The Appellant maintains that the Secretary of State's decisions are unlawful for the reasons given.

Accordingly permission should be granted.

The appeal ought to be allowed"

18. The Appellant's Notice refers in Section 11 to a skeleton argument in support and this appears to have been the document dated 1 March 2015 now before us. For whatever reason, and it is not clear precisely why, this document does not seem to have come to the attention of the respondent's solicitor with conduct of the case until 1 June 2015 after a copy (or further copy) had been requested.
19. The skeleton argument referred to the exchanges between the judge and counsel about the draft judgment which I have outlined above. The argument then went on to say (in paragraphs 18 and 19),

"18. The issue underlying Ground 1 of the claims was whether the Appellants satisfied the immigration rules regarding advertising requirements.

19. The Appellants highlight that, submissions and arguments aside, the Deputy Judge herself accepts that the material in the claim bundle before her indicated that the Claimants'/Appellants' names were linked to their business and would appear to satisfy the immigration rules had it been submitted". [italics in original]

20. At paragraphs 24 and 25 of the argument Mr Saini wrote this:

"24. Therefore, whilst the arguments advanced on the Appellants behalf focussed on the vires of the immigration rules, the Appellants have always maintained throughout these proceedings that their leaflet and business cards were submitted and were before the Secretary of State when a decision was taken and the Respondent has never sought to deny this fact.

25. Consequently, if the Deputy Judge's conclusion is that Ground 1 would [have] succeeded if those advertising materials had been submitted, then the claim should have clearly succeeded on Ground 1 because those materials were submitted as confirmed in the Refusal Letters from the Secretary of State; and had this happened, the vires argument regarding Ground 1 would have become academic and fallen away". [emphasis and italics in original]

21. It was then argued that the "mistake" played a material, if not decisive, part in the court's reasoning because the Deputy Judge explicitly stated that "there was material in the bundle which, in combination, do link the Claimants' names to the business and would – if they had been submitted – appear to have satisfied the requirements of paragraph 41-SD9(iii)(1)". [emphasis in original]
22. Under a heading "Relief" the skeleton argument then invited the court to "quash" the judge's judgment and to replace it with a decision that the appeal succeeded on both grounds as,

"37. ... (a) Re the Advertising materials requirement: The advertising material submitted by the Appellants and before the Secretary of State demonstrates that their business was linked to their identities across their advertising material, namely their leaflet and business cards; and

(b) Re the Contract 'Landline' requirement: The immigration rules requiring the creation and submission of a contract with a third party client where a landline number must be specified are Wednesbury irrational and are stuck down".

The skeleton thereafter also asked for declarations and other orders in similar terms to those sought below. However (a) and (b) (quoted above) were at the forefront of the relief section and were entirely new.

23. By order of 30 April 2015 (sealed on 18 May 2015) Vos LJ granted permission to appeal for these reasons:

"It is arguable that there is a reasonable prospect of success on appeal. The effect of the mix-up after judgment was reserved requires proper consideration, and the appellants should be allowed to argue their grounds of appeal, as elucidated in their skeleton argument".

24. As already mentioned, the skeleton argument did not come to the direct attention of the solicitor responsible for the respondent's case until about 1 June 2015. We were informed that it was on 29 May 2015 that the solicitor also saw a copy of the order granting permission to appeal. On 23 June 2015 the Government Legal Department wrote a long letter to the appellants' solicitors inviting the withdrawal of the appeal on the basis that the submissions advanced on the application for permission to appeal were "misconceived as they neither reflect nor affect the issues which were determined by the Deputy Judge in her judgment". It was pointed out that the Amended Grounds of Claim before the judge no longer challenged the respondent's decisions to refuse leave to remain on the Rules as they stood but instead challenged the lawfulness of the Rules.
25. By letter of 30 June 2015 the appellants' solicitors declined to agree to the withdrawal of the appeal.
26. The respondent did not at that stage issue any application to set aside the permission order. That application did not surface formally until the respondent filed a Respondent's Notice, including in Section 9 an application for an extension of time to file the notice and an application to set aside the permission order.
27. The respondent's applications were listed for hearing before this constitution of the court because of a concern that had arisen as to a pattern of delays on the part of this particular respondent in complying with the rules as to the time for filing respondents' notices. Indeed, the delay in submitting the notice in this case gave serious ground for argument as to whether an extension of time should be granted or not. In my judgment, and subject to my Lords' views, I believe that we should make it clear that this court does not view favourably the type of relaxed approach to the timing of submission of Respondents' Notices that was adopted in the present case. However, in the light of the conclusion that I have reached on the application to set aside the order granting permission to appeal, I do not consider that it is necessary for us formally to decide the application for an extension of time for the Respondent's Notice as a whole.
28. Although I have come to the clear view that the permission order should be set aside, I am also satisfied that the application for that order should equally have been made far earlier than it was. It seems to me that the application should have been initiated no later than the time within which the Respondent's Notice should actually have been served, i.e. 15 June 2015, or at latest by 23 June when the Government Legal Department wrote its long letter to the appellants' solicitors inviting withdrawal of the appeal. It was not made until over three months later. If an application to set aside permission to appeal is not made promptly, the court will have to consider whether to entertain the application at all or whether to apply costs sanctions if the late application is heard and is successful. In the present case, for my part, I was satisfied that we should hear this late application because (for reasons given below) the permission appeared to have been granted on a fundamentally false basis and there could be no purpose to be served by putting the court and the parties to the exigencies of a full appeal in such circumstances. The question of any other sanction still remains.

(E) The application to set aside the permission to appeal order

29. The application to set aside an order granting permission to appeal is made under CPR 52.9 which in its material parts reads as follows:

"52.9 – (1) The appeal court may-…

(b) set aside permission to appeal in whole or in part;…

(2) The court will only exercise its powers under paragraph (1) where there is a compelling reason for doing so…"

30. Mr Gullick, in opening the application, recognised that the onus upon him, to persuade the court to exercise its powers under this rule, was a heavy one. He was content to submit that his application satisfied the criteria set out by Sedley LJ in Hertsmere BC v Harty & ors. [2001] EWCA Civ 1238:

"The power to set aside a grant of permission to appeal is given by Rule 52.9(2) of the Civil Procedure Rules and requires a compelling reason for so doing. I would remind those thinking of making such applications, as the note in the White Book reminds them, that this is not an opportunity to have an early shot at knocking out a weak appeal or an appeal which is now thought to be weaker than it once was. But it must be the case that if a respondent can show the court that the judge was misled by an appellant, not necessarily deliberately, into giving permission to appeal, that may well be a compelling reason within the rule. It must, however, it seems to me, involve showing (a) that the materials put before the judge were inaccurate or incomplete; (b) that these deficiencies had a bearing upon the grounds on which permission to appeal was given; and (c) very importantly, that but for them permission to appeal would not have been given".

31. Mr Gullick argued that the manner in which the application for permission to appeal was advanced was misleading. He pointed out that the judge's draft judgment had not been provided to Vos LJ. In addition to the passages from the skeleton argument to which I have referred, Mr Gullick took us to paragraph 5 of the document where it was said,

"The Deputy Judge stated in her draft judgment that had certain evidence been submitted, the application would have succeeded and the claim for judicial review would also have succeeded; but as that evidence had not been submitted, the claims should fail".

32. Mr Gullick said that the judge's draft judgment in its relevant part (paragraph 7) said nothing of the sort. The judge's draft said that "it was not part of the case before [her]".
33. At paragraph 10 of the skeleton it was also said that, "…both parties are implicitly aware of and accept that the judgment contains a factual error but for which the claims would have succeeded". Mr Gullick says that there was no such acceptance by the respondent. Indeed, the matters relied upon in the skeleton argument had nothing whatever to do with the irrationality/ultra vires arguments that were actually the subject of the claims below. I agree.
34. Further, Mr Gullick pointed to paragraphs 18 and 24 of the argument, which I have already quoted above, in which it is said that the issue "underlying" Ground 1 was whether the appellants satisfied the immigration rules and that the arguments for the appellants "focussed" on the vires of the Immigration Rules. Neither of these statements were accurate. There was no such argument "underlying" Ground 1 and the appellants did not merely "focus" on the question of vires: that was the entirety of their case. This is abundantly clear from both the amended Grounds, from the transcript of the hearing and from the judgment. It is also pointed out that the skeleton argument made a claim for entirely new relief that had never been made below, without alerting the court to that fact. With all these points advanced by Mr Gullick, I agree.
35. Mr Saini submitted that such inaccuracy in the skeleton argument that there may have been can only be seen in hindsight and any inaccuracy can only be classed as "microscopic". He argued that there was a factual mix up and Vos LJ was right to give permission to appeal on that basis.
36. I do not agree. The so-called factual mix up was entirely irrelevant to the matter which the judge had to consider in this case. The argument before the judge was as to the lawfulness of the relevant provisions of the Immigration Rules (with a fall-back argument on "evidential flexibility"), which, (as the judge noted) although not formally abandoned, was not pursued in oral submissions). There was no case being made that the appellants had satisfied the rules. Any observations about the latter point that the judge may have made were, therefore, immaterial to her decision. If there was a factual mix up at all, it had nothing to do with what the judge had to decide. In my judgment, that was not made clear in the skeleton argument that went before Vos LJ. Indeed, I consider that that argument was positively misleading in the respects identified by Mr Gullick.
37. The supposed factual mix up was clearly fundamental to the decision that Vos LJ made to grant permission to appeal. I am entirely satisfied for my part that if Vos LJ had been given a proper presentation of the true position, he would not have made the order that he did.
38. For these reasons, I would set aside the order granting permission to appeal and would substitute for it an order refusing such permission.
39. I would add that nothing in this judgment should be taken as indicating that I am seeking to qualify in any way what Sedley LJ said in the passage from his judgment in Herstmere that I have quoted above. "Compelling grounds" must be demonstrated before an order granting permission to appeal is set aside and the cases in which that will happen will, in my judgment, be exceptional for all the reasons given in Hertsmere and the other reported cases. Mere inaccuracies or infelicities in expression in the application for permission will not found a successful application under CPR 52.9. The present case, to my mind, is (hopefully) an exceptional one in which the application was fundamentally misleading in a manner which clearly formed the entire basis of the grant of permission to appeal.

Lord Justice Davis:

40. I agree.

Lord Dyson, Master of the Rolls:

41. I also agree.

Note 1   “However, it is now apparent that the website material only surfaced for the first time during these proceedings when it was attached to the Defendant’s Supplementary Bundle of Documents and so could not have been raised sooner than that anyhow [Trial Bundle/Part1/A60-A90]”. (Mr Saini’s footnote.)    [Back]