Balajigari v The Secretary of State for the Home Department

An earnings discrepancy does not itself prove dishonesty for the purposes of paragraph 322(5) of the Immigration Rules. The Secretary of State must establish dishonesty on the balance of probabilities, while recognising the seriousness of the allegation and its consequences.

Procedural fairness ordinarily requires advance notice of the suspected dishonesty and a proper opportunity to answer it with representations and evidence. The decision-maker must then assess undesirability and separately consider whether exceptional circumstances displace the presumption of refusal.

A refusal which renders a settled migrant liable to removal will generally engage article 8. A tribunal considering an article 8 challenge must decide dishonesty and proportionality for itself. Public law errors may nevertheless be immaterial if the statutory materiality threshold is met.

Four Tier 1 (General) migrants sought indefinite leave to remain. The Secretary of State refused their applications under paragraph 322(5) of the Immigration Rules, and in one case also paragraph 322(2), because earnings previously declared for immigration purposes differed from tax information held by HM Revenue and Customs.

The appellants challenged the refusals by judicial review in the Upper Tribunal. Permission or substantive relief was refused by different Upper Tribunal judges. The four appeals were heard together as test cases concerning numerous similar earnings-discrepancy decisions.

The principal questions were how paragraph 322(5) should be interpreted and applied; whether procedural fairness required advance notice and an opportunity to answer suspected dishonesty; whether enquiries of HM Revenue and Customs were obligatory; whether article 8 was engaged; and what procedure and standard of review should govern any challenge.

The Court, in a joint judgment delivered by Underhill LJ, allowed all four appeals.

1. Paragraph 322(5) of the Immigration Rules requires a two-stage process. First, the Secretary of State must determine whether reliable evidence establishes sufficiently reprehensible conduct and whether, after considering all relevant circumstances, the applicant's continued presence is undesirable. Secondly, because refusal is presumptive rather than mandatory, the Secretary of State must consider whether exceptional circumstances justify granting leave nevertheless.

2. In an earnings-discrepancy case, carelessness, ignorance or poor advice is insufficient. Dishonesty must be established on the balance of probabilities, with proper regard to the gravity of the allegation and its consequences. A discrepancy may justify suspicion and a request for an explanation, but it does not create a legal burden requiring the applicant to disprove dishonesty. Deliberately giving false earnings information to HM Revenue and Customs or the Home Office will ordinarily be sufficiently serious.

3. Procedural fairness ordinarily requires a “minded to refuse” process. The Secretary of State must identify the suspected dishonesty or other reprehensible conduct and allow the applicant to respond to the conduct, undesirability and discretionary stages. A written procedure will usually suffice. Administrative review was inadequate because fresh evidence could not ordinarily be admitted after applicants had received no prior notice of the allegation.

4. The Secretary of State had power under section 40 of the UK Borders Act 2007 to make enquiries of HM Revenue and Customs, but no separate duty required those enquiries. The Secretary of State and the revenue authority perform different functions, and the former is not bound by the latter's view. A fair opportunity to respond permits an applicant to place any relevant revenue decision before the Secretary of State.

5. Refusal of indefinite leave will generally engage article 8 where it removes existing leave or otherwise renders an established migrant liable to removal. In an article 8 challenge, the tribunal must determine dishonesty and proportionality for itself rather than apply rationality review. Dishonesty will normally justify the interference, although exceptional cases remain possible. A human rights appeal is preferable where one is available; otherwise the issue may be determined in properly pleaded judicial review proceedings.

6. Balajigari, Kawos and Albert were remitted to the Upper Tribunal. The first two cases required consideration of whether procedural unfairness was immaterial. Albert required substantive consideration because it was unclear whether the Secretary of State had made the necessary positive finding of dishonesty. In Majumder, a later tribunal finding that the tax default was innocent defeated the materiality argument, so the refusal of indefinite leave was quashed.

1. Court of Appeal (Civil Division): The conjoined appeals were allowed in Balajigari v The Secretary of State for the Home Department [2019] EWCA Civ 673. Balajigari, Kawos and Albert were remitted to the Upper Tribunal; the Secretary of State's decision in Majumder was quashed.
2. Upper Tribunal: UTJ Gleeson refused Balajigari permission to seek judicial review. UTJ Kamara and UTJ Frances dismissed the substantive judicial review claims in Kawos and Majumder respectively. UTJ Coker refused Albert permission to seek judicial review. No neutral citations for those decisions are stated.