San Michael College Ltd v Secretary of State for the Home Department

Where a public authority gives a regulated sponsor a time-limited opportunity to remedy identified failings under a forward-looking action plan, it must assess compliance principally by reference to that opportunity and the sponsor’s performance under it. It should not rely substantially on historic defaults unless the plan required them to be justified. The decision maker must fairly and adequately consider the sponsor’s representations, improvements and relevant favourable evidence, and give sufficiently clear reasons. A few isolated post-plan defects may not justify suspension or revocation, particularly where the decision does not say that they would independently support the outcome. A process which obscures the true basis of the decision and fails to engage with material changes is unfair in public law, and the resulting decision may be quashed.

San Michael College Ltd, a Tier 4 sponsor, appealed against the Administrative Court’s refusal to quash the Secretary of State’s decisions suspending and then revoking its sponsor licence. The decisions relied on alleged defects in record keeping, student monitoring, undeclared visa letters and attendance rates.

The College argued that the Secretary of State had relied principally on historic failings despite granting a forward-looking Action Plan, and had failed to consider improvements made under that plan. The Administrative Court rejected the challenge in [2011] EWHC 642 (Admin). The central issue before the Court of Appeal was whether the suspension and revocation process had fairly and adequately assessed the College’s compliance and representations.

1. Appeal allowed. The suspension and revocation decisions were quashed.
2. The College’s earlier record-keeping failures were serious and posed a threat to immigration control. However, the lifting of the earlier suspension and the grant of a time-limited Action Plan constituted an opportunity to remedy matters. The Action Plan was forward-looking and required the College to demonstrate that its new processes worked effectively.
3. The Action Plan did not absolutely prevent the Secretary of State from considering past deficiencies. It did require the main emphasis of the later decision to be on the College’s position going forward and its performance under the plan. Unless the plan required past failures to be justified, substantial reliance on pre-plan defaults was inconsistent with the opportunity that had been given.
4. The decision letters focused primarily on historic matters. The few alleged defaults arising during the Action Plan were materially less serious and were not said to justify suspension or revocation independently. In some instances, the decision criticised steps taken by the College to remedy the very defects identified.
5. The decision-making process failed fairly to take account of evidence that record keeping had significantly improved, that an apparently appropriate monitoring system had been introduced, and that the College had been re-accredited. The reasoning was also confused about the allegedly historic attendance figures and did not explain the relevance of the stated refusals of entry clearance.
6. A sponsor is entitled to fair and adequate consideration of its case. Where the process is so unfair and the reasons so obscure that the true basis of the decision cannot be identified, the discretionary decision cannot stand. It was therefore unnecessary to determine the precise number of undeclared visa letters or the accuracy and relevance of the 80 per cent attendance figure.
7. The court declined to hear submissions based on an alleged breach of Article 1 of the First Protocol to the European Convention on Human Rights because the point had not been taken earlier or at trial.
8. As an additional observation, given the College’s past defaults, continued operation under a sponsor licence would warrant close monitoring by UKBA.

• Court of Appeal (Civil Division): Allowed the appeal and quashed the suspension and revocation decisions.
• Administrative Court: Refused the College’s application to quash the Secretary of State’s decisions in [2011] EWHC 642 (Admin).