Gragg v Akaruru [1997] CKHC 2; OA No 4.1996 (29 August 1997)

IN THE HIGH COURT OF THE COOK ISLAND
HELD AT RAROTONGA
(CIVIL DIVISION)

O.A. NO: 4/96

BETWEEN

DAVID LYLE GRAGG
of Rarotonga, Managing Director
Plaintiff

AND

THE HONOURABLE INATIO AKARURU
as Minister of Immigration
Defendant

B J Gibson and P Moodley for Plaintiff
P W Graham for Defendant

Date of Hearing: 27 August 1997
Date of Judgment: 29 August 1997

JUDGMENT OF QUILLIAM CJ

The Plaintiff is a United States citizen who first came to the Cook Islands in 1982. He wished to remain here and moved to American Samoa for three months in order that he could make an application for a work permit. This could not be done while he was living here. When the permit was granted he came to Rarotonga and, apart from irregular holiday visits, has resided here continuously since. He has established himself in business in this country, and in particular as a shareholder in the businesses known as the Beachcomber and the Paradise Inn Motel. Also, on 9 March 1989, he was married in Honolulu to a Cook Islands resident.

It was the Plaintiff's wish that he may be able to obtain permanent residence in the Cook Islands. By marrying a Cook Islands resident he would have greatly improved his chances of being granted residency. His evidence was that he did not wish to obtain residency in this way, namely in reliance on his wife's status, but preferred to demonstrate on his own merits that he had qualified for a grant of permanent residence. This was the reason for the marriage taking place in Honolulu, and for the marriage being kept secret. His wife retained her maiden name of Joan Rolls.

The Plaintiff applied for permanent residence on 28 November 1988. This was twice deferred, namely in 1990 and again on 22 January 1996, and finally, on 23 May 1996, it was declined. Various attempts were made by the Plaintiff and his wife to obtain the reasons why the application was declined, but not only were those requests declined, but a number of remarks made by the Minister and Officers of the Department of Immigration left the Plaintiff with the impression that there was believed to be some sinister incident in his past which adversely reflected on his character and had resulted in his application being declined. Understandably the Plaintiff and his wife were greatly upset about this and it may be that other people had obtained similar impressions so as to affect the Plaintiff's standing in the community.

Accordingly, rather than file a fresh application for permanent residence, the Plaintiff commenced the present proceedings which are for a judicial review of the Minister's decision.

Applications for permanent residence are governed by the Entry, Residence and Departure Act 1971-72, s.5(i) of which provides:

"s.5 (1) The Minister may, in his discretion, on the application of any person who-

(a) is of or over the age of 18 years;

(b) has made his home in the Cook Islands;

(c) is of good character and standing; and

(i)...

(ii) not being a New Zealand citizen, has resided continuously in the Cook Islands for a period of ten years, or such shorter period (being not less than five years) as the Minister may accept, immediately preceding the date of his application, which period shall be deemed not to have been interrupted by a reasonable period or periods of absence from the Cook Islands for holiday or business purposes

grant to such person a certificate in the form or to the effect of the form numbered 1 in the Schedule to this Act conferring on him the status of a permanent resident."

That statute is made pursuant to the provisions of Article 76A of the Constitution of the Cook Islands.

The Plaintiff's case was that he had satisfied all the requirements of s.5 (i) in that he was over 18 years of age, had made his home in the Cook Islands, was of good character and standing, and had resided continuously in the Cook Islands for a period (at the time of his application) of 6 years. At the time his application was declined that period had extended to about 15 years.

The application for review is made on the grounds that the Minister's decision to decline the application was made:

(a) With undue delay;

(b) Failing to take into account facts which were relevant;

(c) Taking into account facts which were irrelevant;

(d) Taking into account facts which were incorrect;

(e) Without the Defendant exercising his discretion reasonably and in good faith and on proper grounds.

It is necessary first to set out the principles which apply to an application of this nature. This was argued as a preliminary matter, and I then gave a brief decision and undertook to put my reasons for it in writing, which I now do.

First, the Minister is given by the statute an absolute discretion to decide whether to grant or decline an application for permanent residence. He is not obliged to give reasons for his decision. Potter v New Zealand Milk Board (1983) N.Z.L.R. 620; NZ Financial Corporation Ltd v New Zealand Kiwifruit Authority [1985] UKPC 17; (1985) 1 N.Z.L.R 159). He is, however, obliged to act fairly, and this was conceded on the Minister's behalf. This is best expressed by the observation of Cooke P. in Minister of Energy v Petrocorp Exploration Ltd [1989] NZCA 95; (1989) 1 N.Z.L.R. 348, at p, 352:

"In administrative law cases about ministerial powers, a balance, sometimes quite a delicate one, has to be maintained. It is the exclusive role of the Minister to decide or apply policy and to act on his or her own view of the merits; that is a field into which the Court must not trespass. On the other hand it is the duty of the Court to check that the Minister acts in accordance with the law and any relevant requirements of fairness and reaches decisions which a reasonable Minister could reach in exercising the powers conferred by Parliament."

If any of the grounds upon which the present application is brought are established, then it would have to be accepted that the Minister had not acted fairly.

Having regard to the way in which the evidence emerged, and in particular to the concessions made by the Minister, it is not necessary for me to traverse all the evidence.

As indicated earlier, the matter of greatest concern to the Plaintiff was his belief that the Minister claimed to have some knowledge of an incident in his past life which was so much to his discredit as to justify a refusal of an application for permanent residence. It is necessary first to consider whether there was any basis for that belief.

Following the deferral in January 1996 of the Plaintiff's application, his wife went to see the Minister in order to try and find out the reasons for the deferral. In response to her enquiry the Minister said that there was something in the Plaintiff's past, before she had met him, but would not say what it was. He said that he was protecting her. It is not surprising that this greatly upset Mrs Rolls-Gragg and the Minister readily volunteered that she was in tears.

The Minister's account of that conversation was less precise. He said what he had told her was that there was something in the file he was not happy about. He explained in evidence that this referred to a Court case about smuggling, but he did not say this to Mrs Rolls-Gragg. Having regard to the number of matters the Minister was required to deal with it is perhaps understandable that his recollection of the details of a particular conversation would be less than complete. I accept Mrs Rolls-Gragg's account, particularly as it finds substantial support from a later conversation which a freelance journalist, Mrs Florence Syme Buchanan had with the Principal Immigration Officer, Mr. Toru. Mrs Syme Buchanan was aware of a good deal of public concern about the Plaintiff's inability to obtain permanent residence and rang Mr. Toru about it in order to write a newspaper article. Mr. Toru said he did not recall the conversation.

What Mrs Syme Buchanan reported was that Mr. Toru told her "we have no idea where he got his money from " and "There are so many things we need to know about David... all that we know is what we have", which was a reference to an order for discovery of the Department's file.

It should be mentioned that there seems to have been no basis for concern about the source of the Plaintiff's money for the acquisition of his home and his interests in the businesses he was involved in. He obtained bank loans on mortgage in the usual way.

There is no doubt that there was cause for genuine concern on the part of the Plaintiff and his wife as to the real reason for the deferral and ultimate declining of his application. This concern should, however, be dispelled by the evidence given by the Minister. On behalf of the Plaintiff the most unusual course was taken of calling the Minister (who was the Defendant) on subpoena as a witness. That course did, however have the result of revealing to the Plaintiff for the first time the Minister's reasons. He made it clear that the only concern he had over the Plaintiff was the record on his file of a conviction entered in this Court on 27 November 1993. As mentioned previously, the way he described that to Mrs Rolls-Gragg
was that it was about smuggling. It is accordingly necessary to set out the correct position regarding that conviction.

In September 1993 the Plaintiff returned to Rarotonga from a buying trip. He had bought a number of goods, some of which he had arranged to be air freighted, and the rest of which were in his baggage. In completing the customs declaration form he had answered all questions in the negative and confirmed this when questioned orally. A search of his luggage revealed a quantity of jewellery. His explanation was that the declaration form was normally completed by his wife who usually travelled with him. On this occasion he was alone, and had taken some medication for the flight and had difficulty reading the small print on the declaration form.

The Plaintiff was charged with wilfully making a false declaration, an offence carrying a maximum penalty of imprisonment for 2 years. Having heard this evidence the Judge accepted the Plaintiff's explanation and reduced the charge to one of making a declaration which was erroneous. That offence carried a maximum penalty of a fine of $200. The Plaintiff was thereupon convicted of that offence and fined $200. He had also been charged upon the same facts with smuggling, and for this he was convicted and fined $100 and the goods were forfeited.

The Plaintiff appealed against the conviction and sentence for smuggling. Having regard to the Judge's finding on the first charge that the making of the false declaration had not been wilful the Court of Appeal held that a conviction on the smuggling charge (which necessarily included the element of wilfulness) could not stand, and that conviction was quashed. There had been no appeal in respect of the first charge. In the result the Plaintiff's action had been careless but not dishonest.

I have thought it proper to set out these circumstances in some detail because of the Minister's evidence that the Plaintiff's conviction was the real, and indeed the only, reason for the deferral and declining of the application for residence. It was also apparent from what the Minister said that he had failed to understand the nature and significance of the conviction. In his evidence he referred more than once to the conviction as relating to smuggling. Having regard to the successful appeal that was not only incorrect, but established that he had applied to his decision a matter which ought not to have been taken into account. This was an error sufficient to justify the declaration sought by the Plaintiff. What the Minister ought to have done was to accept that the Plaintiff's offence was the relatively minor one of having carelessly made a wrong declaration, and then to consider whether such a conviction was of sufficient seriousness as to mean that he could not be regarded as a person of good character and standing.

It is not for the Court to offer the Minister any suggestion as to what his decision on this should have been. That was a matter for the Minister alone. The Court is, however, entitled to find that the Minister approached his task by applying to it a wrong understanding of the only matter which he felt may be in the Plaintiff's discredit.

Having had his attention drawn to the correct position regarding the conviction the Minister fairly acknowledged that in the event of a fresh application he could well expect that approval may be given. He did not, of course, bind himself to do that, but at least the Plaintiff would be able to feel that a fresh application would be considered with the previous misunderstanding as to the conviction removed.

There will accordingly be a declaration that, in his consideration of the Plaintiff's application for permanent residence, the Minister:

(i) Failed to take into account facts which were relevant, namely the correct nature of the Plaintiff's conviction; and

(ii) Took into account facts which were incorrect, namely that the Plaintiff's conviction had been in respect of smuggling.

I should add that it may have been proper to make a declaration on the basis of undue delay, namely the period between the filing of the application on 28 November 1988 and the decision on that application on 23 May 1996. I do not do so as I understood from the Minister that there would be no comparable delay if a fresh application is made.

Leave is reserved to the Plaintiff to apply for costs.

CHIEF JUSTICE