Date: 20110531
Docket: IMM-4562-10
Citation: 2011
FC 631
Ottawa, Ontario,
May 31, 2011
PRESENT: The Honourable Mr. Justice O'Keefe
BETWEEN:
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ANATOLIY KABANETS
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Applicant
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and
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THE MINISTER OF CITIZENSHIP AND IMMIGRATION
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Respondent
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REASONS FOR JUDGMENT AND
JUDGMENT
[1]
This is an application pursuant to subsection 72(1) of the Immigration
and Refugee Protection Act, SC 2001 c 27 (the Act) for judicial review of a
decision of a First Secretary of the Immigration Section at the Canadian
Embassy in Kyiv, Ukraine (the Secretary), dated July 23, 2010, wherein the
Secretary refused the applicant permanent residence as a member of the
entrepreneur class as defined in subsection 88(1) of the Immigration and
Refugee Protection Regulations, SOR/2002-227 (the Regulations).
[2]
The
applicant requests an order quashing the decision of the First Secretary and
directing the respondent to process his application according to the law and
within 60 days of the date of the order.
Background
[3]
Anatoliy
Kabanets (the applicant) is a Ukrainian citizen. He has lived and worked in
Kyiv since 1990. On his release from the military in October 1999, he began
working for a company called Petrus as a mechanical engineer. He worked for
Petrus until July 2007 and has worked for several other companies since that
time in engineering positions.
[4]
In
July 1999, the applicant and his brother registered the company, Viol (Viol or
the business). The applicant is a founder and owner of the business, which is
located several hours away from Kyiv in Kamyanets-Podilskyy. The applicant
holds a 40 percent share of the business and his brother holds the remaining 60
percent. It is not disputed that Viol meets the definition of a “qualifying business”
in the Regulations.
[5]
In
August 2001, the applicant’s wife applied for a permanent resident visa. She
was interviewed in January 2002 and was questioned about the applicant’s
employment, along with other details related to her application. The only employment
of his that she described on her application and in her interview was his
position with Petrus.
[6]
On
August 16, 2005, the applicant applied for a permanent resident visa as a
member of the entrepreneur class.
[7]
The
Secretary interviewed the applicant on July 19, 2010 regarding his application.
The applicant was asked questions about the financial and day-to-day management
of Viol. He claimed that, since January 2000, he has handled the day-to-day
management of Viol, including negotiating with suppliers and preparing a list
of the orders, as well as overseeing production and equipment maintenance. The
applicant claimed to have spent a great deal of time on-site until 2007 and
since then, has visited approximately once a week. The applicant has signing
authority on the business’s bank account but has never received more than a
nominal salary and in fact, only received any salary in 2004 and 2005.
The Secretary’s Decision
[8]
The
Secretary determined that the applicant had failed to demonstrate the management
experience required by the Regulations. The Secretary was concerned that
virtually all of the business’s documents that were submitted were signed by
his brother (or in a few instances by Viol’s accountant) rather than by the
applicant.
[9]
Further,
the applicant was unable to answer questions about Viol’s profits, turnover,
payroll information, suppliers or to identify the company’s most profitable
year.
[10]
The
Secretary noted that the applicant provided conflicting information in his
interview which was not supported by the documents submitted. The Secretary
acknowledged that one partner of a business may not always be very familiar
with the finances, but found that it was reasonable to expect that someone
involved in managing a company would have at least a general idea of its
profits and losses.
[11]
The
Secretary further noted that throughout the relevant period, the applicant had
lived in Kyiv, which he acknowledged was several hours away from Viol’s office
in Kamyanets-Podilskyy. The Secretary was also concerned that the applicant has
generally not received a salary from Viol and that, when he did receive a
salary in 2004 and 2005, it was a nominal one, and with his failure to explain
why his wife’s application for permanent residence did not mention Viol.
Issues
[12]
The
applicant characterizes the issues as:
1. Did the Secretary
misapply the definition of an entrepreneur:
a. By
equating financial management with financial control and with business
management; and
b. By
failing to consider the five years preceding the date of the application?
2. Do
the deficiencies in the CAIPS notes amount to a breach of procedural fairness?
[13]
I
would rephrase the issues as follows:
1. What is the
appropriate standard of review?
2. Are the CAIPS notes
deficient?
3. Is the decision
reasonable?
Applicant’s Written Submissions
[14]
The
applicant submits that the Secretary erred by misapplying the definition of an
entrepreneur in considering his application. The applicant argues that the
Secretary erred by interpreting the definition as requiring an applicant to
demonstrate financial management of the business. The applicant claims that he
handles the everyday management of the business even though his brother handles
the financial management. The applicant further argues that he was aware of
some of the financial details of the business, including how employees’
salaries are calculated and its most profitable years.
[15]
The
applicant claims that he handles negotiations with suppliers, oversees the
production process, hiring staff, purchasing and maintaining machinery and
overseeing deliveries. The applicant argues that this evidence demonstrates his
experience managing the business.
[16]
The
applicant submits that the Secretary erred by only considering the recent
evidence and not considering the evidence from earlier in the relevant period.
The relevant period for assessment spanned almost 10 years and the applicant
argues that the Secretary’s focus on the management of the business in recent
years is unreasonable. The applicant relies on Hajariwala v Canada (Minister
of Employment and Immigration), [1989] 2 FC 79, in which this Court held
that the purpose of the Act is to permit immigration and that officers are
therefore obliged to provide a thorough and fair assessment of applications.
[17]
The
applicant submits that the CAIPS notes are deficient and that this deficiency
amounts to a breach of procedural fairness. The applicant argues that a
corrupted or incomplete file can amount to a breach of procedural fairness,
citing Velazquez Ortega v Canada (Minister of
Citizenship and Immigration), 2008 FC 1407. The applicant argues that
the deficiencies in the CAIPS notes, which are listed in his affidavit, would
all have been in his favour had they been corrected. The applicant therefore
argues that the deficiencies are material and warrant this Court’s
intervention.
Respondent’s Written
Submissions
[18]
The
respondent submits that the Secretary asked the applicant questions about the
day-to-day management of the business as well as about its finances. The
respondent argues that the Secretary considered all of the evidence and that it
was open to her to conclude that the applicant did not have the required
management experience. The respondent notes that, contrary to the arguments in
his memorandum, the applicant was not able to identify the business’s most
profitable year.
[19]
The
respondent submits that the Secretary considered the proper relevant period and
identified it in the decision as the period from August 16, 2000 to the date of
the decision.
[20]
The
respondent submits that the deficiencies in the CAIPS notes are explained in
the Secretary’s affidavit and that they resulted from the reproduction and
transmission of the notes rather than from the notes themselves. A complete
copy of the CAIPS notes is included in the Secretary’s affidavit.
Analysis and Decision
[21]
Issue
1
What is the
appropriate standard of review?
The applicant submits that
breaches of procedural fairness are reviewable on the correctness standard,
citing Dunsmuir v New Brunswick, 2008 SCC 9, [2008] 1 S.C.R. 190 and Velazquez
Ortega above. The respondent submits that the standard of review applicable
to findings of fact and to questions of mixed fact and law is reasonableness,
citing Dunsmuir above.
[22]
The
issue of whether the CAIPS notes are deficient is a question of procedural
fairness and therefore attracts the correctness standard, as the applicant has
argued.
[23]
Although
not specifically argued by either party, this Court has held that decisions of
a visa officer reviewing an application from a member of the entrepreneur class
attract deference and are therefore reviewable on the reasonableness standard
(see Nasseri v Canada (Minister of Citizenship and Immigration), 2008 FC
1330 at paragraph 14).
[24]
Issue
2
Are the CAIPS notes deficient?
The CAIPS
notes appear to have been corrupted when they were printed off and transmitted
rather than being deficient in and of themselves. As such, these deficiencies
do not breach procedural fairness. The full notes, which are reproduced in the
Secretary’s affidavit, include evidence in support of the application, the
omission of which the applicant claims breached procedural fairness. The
Secretary’s evidence demonstrates that all of the evidence was before her when
she decided the application and that procedural fairness was therefore not
breached.
[25]
Velazquez
Ortega above,
is not relevant to this application. That decision involved a pre-removal risk
assessment (PRRA) in which an applicant made it clear that he intended to rely
on new evidence which he sent to the officer via courier. The evidence was lost
through no fault of the applicant’s and was not considered by the officer and
so his PRRA was rejected. The Court held that the loss of this evidence
breached procedural fairness because it was relevant and was lost through no
fault of the applicant.
[26]
The
applicant claims that the Secretary failed to address the earlier time period
prior to 2007. However, a review of the CAIPS notes shows that the Secretary
did look at this period. By way of example, the CAIPS notes at page 22 of the
applicant’s record, read as follows:
Furthermore, the documentation on file
and that presented at interview does not support that the applicant was on site
managing the day to day activities and operation of the business. The fact
remains that the applicant has lived in and worked in Kyiv during the period
where he states he was also managing the business Agenstvo Viol in
Kamyanets-Podilskyy a significant distance (more than 5 hours) away. The
applicant’s current and previous employer had no knowledge of the applicant’s
business Viol, therefore it is reasonable to conclude that he was not
conducting his private business activities while at work to an extent that they
required explanation.
I also balance the fact that the applicant
states that until 2007 he had a flexible work schedule with Petrus company and
so could be more often on site at Agenstvo Viol company, to the fact that
Agenstvo Viol is located more than 7 hours by train or 5 hours by car from
where the applicant lives and works. I do not find it credible that the
applicant would be able to be significantly present at Agenstvo Viol while
living and working elsewhere, even with a flexible work schedule.
The applicant states that he has not paid
tax on any income from the company because he has not received any dividends
from the company. As per pay roll records he is only listed in the year
2004-2005 and for a nominal salary. Applicant’s brother however receives a
monthly salary. . . .
[27]
Issue
3
Is the decision reasonable?
The applicant has failed to
demonstrate that the decision is unreasonable. Although the applicant has
highlighted certain evidence which favours his application, that evidence was
before the Secretary when she rejected his application and it appears that the
applicant is merely disputing the weight assigned to this evidence. The
applicant has failed to establish that the decision does not fall within the
range of reasonable outcomes defensible in fact and in law and has therefore
failed to establish a basis for this Court’s intervention.
[28]
As a
result, the
application for judicial review should be dismissed.
[29]
Neither
party wished to submit a proposed serious question of general importance for my
consideration for certification.
JUDGMENT
[30]
IT IS ORDERED
that the
application for judicial review is dismissed.
“John
A. O’Keefe”
ANNEX
Relevant Statutory Provisions
Immigration and Refugee Protection Act, SC 2001 c 27
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12.(2) A
foreign national may be selected as a member of the economic class on the
basis of their ability to become economically established in Canada.
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12.(2) La
sélection des étrangers de la catégorie « immigration économique »
se fait en fonction de leur capacité à réussir leur établissement économique
au Canada.
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Immigration and Refugee Protection
Regulations,
SOR/2002-227
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88. (1) The definitions in this
subsection apply in this Division.
“business
experience”, in respect of
. . .
(b) an
entrepreneur, other than an entrepreneur selected by a province, means a minimum
of two years of experience consisting of two one-year periods of experience
in the management of a qualifying business and the control of a percentage of
equity of the qualifying business during the period beginning five years
before the date of application for a permanent resident visa and ending on
the day a determination is made in respect of the application; and
“entrepreneur”
means a foreign national who
(a) has
business experience;
(b) has a
legally obtained minimum net worth; and
(c) provides
a written statement to an officer that they intend and will be able to meet
the conditions referred to in subsections 98(1) to (5).
“percentage of
equity” means
. . .
(b) in
respect of a corporation, the percentage of the issued and outstanding voting
shares of the capital stock of the corporation controlled by a foreign
national or their spouse or common-law partner; and
“qualifying
business” means a business — other than a business operated primarily for the
purpose of deriving investment income such as interest, dividends or capital
gains — for which, during the year under consideration, there is documentary
evidence of any two of the following:
(a) the
percentage of equity multiplied by the number of full time job equivalents is
equal to or greater than two full-time job equivalents per year;
(b) the
percentage of equity multiplied by the total annual sales is equal to or
greater than $500,000;
(c) the
percentage of equity multiplied by the net income in the year is equal to or
greater than $50,000; and
(d) the
percentage of equity multiplied by the net assets at the end of the year is
equal to or greater than $125,000.
97. (1) For the purposes of
subsection 12(2) of the Act, the entrepreneur class is hereby prescribed as a
class of persons who may become permanent residents on the basis of their
ability to become economically established in Canada and who are
entrepreneurs within the meaning of subsection 88(1).
(2) If a
foreign national who makes an application as a member of the entrepreneur
class is not an entrepreneur within the meaning of subsection 88(1), the
application shall be refused and no further assessment is required.
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88. (1) Les
définitions qui suivent s’appliquent à la présente section.
« expérience
dans l’exploitation d’une entreprise » :
. . .
b) s’agissant
d’un entrepreneur, autre qu’un entrepreneur sélectionné par une province,
s’entend de l’expérience d’une durée d’au moins deux ans composée de deux
périodes d’un an d’expérience dans la gestion d’une entreprise admissible et
le contrôle d’un pourcentage des capitaux propres de celle-ci au cours de la
période commençant cinq ans avant la date où la demande de visa de résident
permanent est faite et prenant fin à la date où il est statué sur celle-ci;
« entrepreneur
» Étranger qui, à la fois :
a) a de
l’expérience dans l’exploitation d’une entreprise;
b) a
l’avoir net minimal et l’a obtenu licitement;
c) fournit
à un agent une déclaration écrite portant qu’il a l’intention et est en
mesure de remplir les conditions visées aux paragraphes 98(1) à (5).
« pourcentage
des capitaux propres »
. . .
b) dans
le cas d’une société par actions, la part des actions du capital social avec
droit de vote émises et en circulation que contrôle l’étranger ou son époux
ou conjoint de fait;
«
entreprise admissible » Toute entreprise — autre qu’une entreprise exploitée
principalement dans le but de retirer un revenu de placement, tels des
intérêts, des dividendes ou des gains en capitaux — à l’égard de laquelle il
existe une preuve documentaire établissant que, au cours de l’année en cause,
elle satisfaisait à deux des critères suivants :
a) le
pourcentage des capitaux propres, multiplié par le nombre d’équivalents
d’emploi à temps plein, est égal ou supérieur à deux équivalents d’emploi à
temps plein par an;
b) le
pourcentage des capitaux propres, multiplié par le chiffre d’affaires annuel,
est égal ou supérieur à 500 000 $;
c) le
pourcentage des capitaux propres, multiplié par le revenu net annuel, est
égal ou supérieur à 50 000 $;
d) le
pourcentage des capitaux propres, multiplié par l’actif net à la fin de
l’année, est égal ou supérieur à 125 000 $.
97. (1) Pour
l’application du paragraphe 12(2) de la Loi, la catégorie des entrepreneurs
est une catégorie réglementaire de personnes qui peuvent devenir résidents
permanents du fait de leur capacité à réussir leur établissement économique
au Canada et qui sont des entrepreneurs au sens du paragraphe 88(1).
(2) Si
le demandeur au titre de la catégorie des entrepreneurs n’est pas un entrepreneur
au sens du paragraphe 88(1), l’agent met fin à l’examen de la demande et la
rejette.
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