Dr Michael Van Thanh Quach v MLC Life Limited

Federal Court of Australia|2020-04-24|Before: Griffiths J

Dr Quach tried to stop MLC from obtaining medical records through subpoenas for his insurance dispute. He argued that MLC had already accepted liability based on internal legal advice, so the subpoenas were unnecessary and improper. The Court rejected this, finding that the advice merely said it was 'arguable' that Dr Quach had a valid claim, and was not binding on MLC. The Court also rejected Dr Quach's other arguments—that MLC breached its duty of good faith, misled the Court, abandoned its rights by delay, or that the Court lacked jurisdiction. The Court found the subpoenas valid because the medical records were relevant to whether Dr Quach couldn't work due to illness or merely due to losing his medical licence. Both applications were dismissed with costs.

The interlocutory applications filed on 17 January 2020 and 28 January 2020 be dismissed. The applicant pay the respondent's costs of and incidental to both interlocutory applications, as agreed or taxed. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

GRIFFITHS J: 1 By two interlocutory applications filed on 17 January 2020 and 28 January 2020, Dr Quach seeks to set aside in full or in part various subpoenas which have been issued by the respondent, MLC Life Limited (MLC). The substantive proceeding relates to Dr Quach's dissatisfaction with the MLC's rejection of his claim on an insurance policy called the MLC personal protection portfolio policy. 2 The first interlocutory application seeks the following relief (without alteration): 1. Set aside parts of ten subpoenas issued by MLC Limited dated 21 June 2019 issued to: I. Dr Michael Van Thanh Quach II. Botany Medical Centre III. Railway Street Medical Centre IV. Dr Andrew Petherbridge V. Dr Bernard St George VI. Dr Karleng Tan VII. Susan Morton VIII. Sara Guirgis IX. Dr Merson Mathew X. Department of Human Service 2. Revoke Leave to issue or set aside any further subpoenas that MLC Limited has requested leave to issue: I. Dr Jeff Bertucen II. Professor Roy Gary Beran III. Dr Anthony Samuels IV. Dr Simon John Whitfield Young V. Dr Yvonne Skinner VI. Dr Jonathan Phillips. 3 The second interlocutory application seeks the following relief (without alteration): Set aside subpoenas and/or amended subpoenas issued by MLC Limited to: I. Dr Andrew Petherbridge II. Dr Anthony Samuels III. Dr Jeff Bertucen IV. Dr Jonathan Phillips V. Dr Karleng Tan VI. Dr Simon Young VII Dr Yvonne Skinner VIII Professor Roy Beran IX Dr Merson Matthew, Weston Creek Medical Centre X Dr Dzu Nguyen, Botany Medical Centre XI Dr Susan Morton, Kaleen Medical Practice XII Ms Cindy Watts. 4 Dr Quach was previously successful in having set aside relatively small parts of the eight of the ten subpoenas specified at paragraph 1 of the extract at [2] above (see Quach v MLC Life Limited (No 1) [2019] FCA 1194). With respect to the remaining two subpoenas identified in that extract, Dr Quach was not successful in the challenge to the subpoena issued to Dr Quach personally. No order was made with respect to the subpoena issued to the Department of Human Services, the terms of which did not come within the scope of the complaint raised by Dr Quach. 5 In his first interlocutory application, Dr Quach seeks to have set aside other parts of those original ten subpoenas, relying on grounds which he now acknowledges he didn't raise previously. In his first interlocutory application, Dr Quach also seeks to have revoked or set aside leave granted by the Court on 1 August 2019 for MLC to issue the six subpoenas which are identified in [2(b)] above. It is significant to note at this point that Dr Quach sought leave to appeal from unfavourable parts of my judgment and orders in Quach v MLC Life Limited (No 1) [2019] FCA 1194. That application for leave to appeal was dismissed by Rares J on 20 November 2019, with costs (see Quach v MLC Limited (No 3) [2019] FCA 2066). 6 Dr Quach's second interlocutory application relates to 12 subpoenas identified therein which were issued by MLC in January 2020. Many of these subpoenas are in substance amended subpoenas which were reissued to reflect the Court's orders dated 1 August 2019. 7 It is unnecessary to restate the relevant general principles concerning the quashing of the subpoenas as they are set out in my earlier reasons for judgment as referred to at [4] above. 8 Dr Quach relied on four affidavits in support of his two interlocutory applications. Those affidavits are dated 17 January 2020, 13 February 2020, 1 March 2020 and 23 March 2020. Prior to the hearing, Dr Quach provided an outline of written submissions, as did the respondent. By consent, the hearing of the interlocutory applications was conducted by way of a telephone hearing, having regard to the current national health crisis.

Dr Quach's submissions summarised 9 It is desirable to set out virtually in full Dr Quach's outline of written submissions (without alteration). Submissions in support of Interlocutory Application lodged 17 January 2020 … MLC Limited defaulted on the question of privilege, initially claimed over the legal advice from MLC Senior Legal Counsel, Suzanne Oliver. MLC Limited's position in respect of the income protection insurance claim on Policy number 168 880 009 has always been to accept liability, as expressed by MLC Senior Legal Counsel, Suzanne Oliver, "If Dr Quach did in fact suffer from Narcisstic Personality Disorder, and that is a sickness and it was that sickness that caused the behaviour that constituted the professional misconduct, that caused him to be unable to perform the duties of his occupation, it is arguable that he may have been totally disabled." I rely on the Affidavit of 1 March 2020, to show that Narcisstic Personality Disorder is described as a sickness in the American Psychiatric Association Diagnostic and Statistical Manual of Mental Disorders (DSM-5). Therefore, MLC Limited's position is to accept liability for the claim for total disability. Pursuant to Mason J ruling in Minister for Aboriginal Affairs v Peko-Wallsend Ltd [1986] HCA 40 (1986) 162 CLR 24 at [20] of Mason J's ruling, "...decisions is to be made on the basis of the most current material available to the decision maker." In my respectful submission, the Federal Court is bound by this ruling of Mason J and must decide the two interlocutory applications 17 January 2020 and 28 January 2020, on the "basis of the most current material available," being MLC Limited's position of acceptance of liability. Therefore, there is no application for res judicata. In fact, MLC Limited breached its "duty of the utmost good faith," under Section 13 of the Insurance Contract Act 1984 (Cth), by withholding MLC Limited Legal Counsel advice from the Applicant and the Federal Court, before Griffiths J on 1 August 2019, and Rares J on 20 November 2019. On 1 August 2019, MLC Limited Limited (Mr Opus) misled the Federal Court, before Griffiths J, that requests for Leave to issue subpoenas for reasons of whether the Applicant satisfies definition of ""total disability" or "partial disability" in the policy as a result of an illness;..." which is contrary to the Legal Advice of MLC Senior Legal Advisor, Suzanne Oliver. I refer Annexure 'MTVQ2" of the Affidavit of 23 March 2020 being a copy of the extract for transcript for 1 August 2019: i. Line 36, page 41 ii. Line 17, page 42 iii. Line 30, page 42 iv. Line 37, page 42 v. Line 44, page 42 vi. Line 6, page 43 vii. Line 23, page 43 MLC Limited misled the Court when it relied on the reason, "The Claim was declined on the basis that, inter alia, the Applicant is unable to work due to the cancellation of his medical registration rather than an illness." This appears in all requests for leave to issue subpoenas. It is a fact that as at 17 January 2020, MLC Limited had not issued amended subpoenas to: i. Botany Medical Practice, ii. Railway Street Medical Practice, iii. Dr Andrew Petherbridge, iv. Dr Bernard St George, v. Dr Karleng Tan, vi. Susan Morton, vii. Sar Gurgis, viii. Dr Merson Matthew, ix. Department of Human Services, nor issued further six subpoenas to: i. Dr Jeff Bertucen, ii. Professor Roy Gary Beran, iii. Dr Anthony Samuels, iv. Dr Simon John Whitfield Young, v. Dr Yvonne Skinner, vi. Dr Jonathan Phillips, pursuant to Griffiths J judgement Dr Michael Van Thanh Quach v MLC Life Limited (No1) [2019] FCA 1194 and the directions of Registrar Lackenby on 13 September 2019. This is more that five and a half months after Griffiths J judgement. On the 1 August 2019, MLC Limited asked for two weeks to file a submission. Your Honour's opined that "Well, I think that's too leisurely, with respect." In my respectful submission, Your Honour would think that more than five and a half months to reissued amended subpoenas and issue new subpoenas would be abandonment. On the grounds of Section 47(2) of the Insurance Contract Act 1984 (Cth), "...the insurers may not rely on provisions included in the contract that has the effect of limiting or excluding the insurer's liability under the contract by reference to a sickness or disability to which the insured was subject at a time before the contract was entered into." in my respectful submission, the Federal Court is also bound by Mason J ruling, in Aboriginal Affairs v Peko-Wallsend Pty Ltd. The fact is, MLC Limited is aware that there was no diagnosis from Dr Anthony Samuels nor Dr Jonathan Phillips, as evident in the Legal advice from Senior Legal Counsel, Suzanne Oliver. I rely on the Affidavit of 23 March 2020, Annexure "MTVQ1" being an extract of MLC Limited Legal Advice from Senior Counsel, Suzanne Oliver, "Notably, Dr Phillips was unable to conclude that Dr Quach had any recognisable or diagnosable paranoid or other psychiatric disorder...Accordingly, there is no evidence of psychiatric diagnosis at this point." MLC Limited knew, as expressed by MLC Senior Legal Counsel that,"...there was no evidence of psychiatric diagnosis at this point." In my respectful submission, MLC Limited is in breached of Section 47(2) of the Insurance Contract Act 1984 (Cth) and misled the Federal Court in its requests for leave to issue subpoena to the Applicant, Dr Michael Van Thanh Quach, when it relied on the reason of, "The definition of Total disability in the Policy requires the Applicant to be continuously unable to do at least one of important Duties of his occupation (as defined in the Policy) ..." This is because MLC Limited's position has always been, as stated by its Senior Legal Counsel, Suzanne Oliver, that she would argue that the claim on Policy 168 880 009 satisfies the definition of "total disability." Therefore, MLC Limited cannot rely on subpoenas, all of which were issued for reasons on reliance on terms of "contract by reference to a sickness or disability to which the insured was subject at a time before the contract was entered into." In my respectful submission, pursuant to Mason J ruling in Minister for Aboriginal Affairs v Peko-Wallsend Ltd, on the basis of the most current material available to the Court, the subpoena to the Applicant, Dr Michael Van Thanh Quach should be set aside. In my respectful submission, the Federal Court would be bound by Mason J's ruling to set aside all subpoenas issued by MLC Limited on the grounds that: i. MLC Limited breached Section 13 of the Insurance Contract Act 1984 (Cth) to mislead the Court and the Applicant. ii. Section 47(2) of the Insurance Contract Act 1984 (Cth) does not allow MLC Limited to rely on any provisions of the contract, as reasons to issue all the subpoenas, to "the effect of limiting or excluding the insurer's liability under the contract by reference to a sickness or disability to which the insured was subject at a time before the contract was entered into." iii. As at 17 January 2020, MLC Limited had abandoned and not re-issued amend subpoenas nor new subpoenas pursuant to Dr Michael Van Thanh Quach v MLC Life Limited (No1) [2019] FCA 1194. The abandoned subpoenas should be set aside, and leave to issue a further six subpoenas should be revoked. I refer to the Affidavit of 23 March 2020, Table 1. Submissions in support of Interlocutory Application lodged 28 January 2020 Consistent with Griffiths J Order 9 in Dr Michael Van Thanh Quach v MLC Life Limited (No1) [2019] FCA 1194, in my respectful submission, the Federal Court does not have jurisdiction in "suits" between the State and myself, the Applicant, pursuant to Section 38(2) of the Judiciary Act 1903 (Cth). It is a fact that MLC Limited accepts liability of the Applicant's income protection insurance claim, as expressed by MLC Senior Legal Counsel, Suzanne Oliver. I rely on Affidavit of 23 March 2020, Annexure "MTVQ1" being an extract of MLC Limited Legal Advice from Senior Counsel, Suzanne Oliver. The "disability" relies on an alleged letter of complaint from the Canberra Hospital to the NSW Medical Board, which was the reason for the investigation by the NSW Medical Board in 1997, and later the Medical Council of New South Wales. To assist the Court, I have endeavoured to find the alleged letter of complaint from the Canberra Hospital. In response to my request, the Canberra Hospital stated that it has no record of any letter of complaint to the NSW Medical Board in 1997. I refer to the Affidavit of 13 February 2020. As the Canberra Hospital has stated that the letter of complaint to the NSW Medical Board in 1997 does not exists, the Federal Court is asked to make a ruling under its original jurisdiction of Australian Capital Territory (Self-government) Act 1988 (Cth), under Section 48AA ACT laws may give concurrent jurisdiction to the Federal Court of Australia, to rule that no letter of complaint from the Canberra Hospital to NSW Medical Board exists. In relation to subpoenas seeking information on matters between NSW Health Care Complaints Commission and the Applicant (myself), in my respectful submission, the Federal Court does not have jurisdiction over matters or "suit between States or between persons suing or being sued on behalf of different States, or between a State and a person suing or being sued on behalf of another State," pursuant to Section 38(2) of the Judiciary Act 1903 (Cth). These are "matter[s] in which jurisdiction of High Court exclusive. " All subpoenas issued by MLC Limited relate to matters of an alleged illness in "suits" between the State of NSW and myself (the Applicant). I rely on Affidavit of 23 March 2020 Table 2. In my respectful submission, "jurisdictional fact" cannot be established for the Federal Court of Australia to grant leave to issue subpoenas for matters made in "suits" between State of NSW and myself, the Applicant (Gedeon v NSW Crime Commission [2008] HCA 43 at [43]). Therefore, in my respectful submission, all subpoenas issued and re-issued by MLC Limited should be set aside.

Dr Quach's oral submissions summarised 10 Dr Quach made detailed oral submissions in support of his two interlocutory applications. In large measure, those submissions were by way of elaboration on what he had written in his outline of submissions. 11 In response to MLC's contention that the applications were incompetent because of the doctrine of res judicata flowing from Rares J's orders dated 20 November 2019 (citing the decision of the Court of Appeal of NSW in Forge v Australian Securities and Investment Commission (No 2) [2007] NSWCA 42; 69 NSWLR 575). Dr Quach submitted that the principle in that case had no application to the Federal Court, which he submitted was a higher Court in the judicial hierarchy. Surprisingly, Dr Quach referred to s 109 of the Constitution in support of this submission. 12 In his oral submissions, Dr Quach referred several times to the internal legal advice given to MLC by its legal counsel, Ms Suzanne Oliver. Originally, MLC claimed legal professional privilege in respect of that advice. I upheld that position in Quach v MLC Life Limited (No 2) [2019] FCA 1322. Justice Rares subsequently granted Dr Quach leave to appeal from that decision. The appeal was then rendered moot when MLC provided a copy of Ms Oliver's advice to Dr Quach. Dr Quach drew attention to statements by Ms Oliver at page 8 of her advice where she wrote (emphasis in original): Dr Quach has said he was diagnosed with an "impairment" in 2009. The NCAT decision shows that Dr Phillips concluded that Dr Quach was "a medical practitioner who may be suffering from an impairment which will put the public at risk". That was in the context of the particular legislation about impairment pursuant to which Dr Phillips was examining Dr Quach. Notably, Dr Phillips was unable to conclude that Dr Quach had any recognisable or diagnosable paranoid or other psychiatric disorder but said; "I believe an underlying paranoid disposition or paranoid illness cannot be ruled out". Accordingly, there is no evidence of psychiatric diagnosis at this point. 13 Dr Quach complained that it was not open to MLC to issue the subpoenas in circumstances where it had obtained Ms Oliver's advice as referred to above. He further complained that Ms Oliver's advice was inconsistent with statements which were made to the Court by MLC's then counsel on 1 August 2019 when the Court was informed that MLC wished to issue subpoenas to Dr Phillips, Dr Skinner, Dr Young, Professor Beran and Dr Ellis because the records they held were relevant to whether Dr Quach satisfied the definition of "totally disabled" or "partially disabled" in the relevant insurance policy as a result of an illness. 14 Dr Quach also submitted that because of the more than five months delay since the Court's orders were made on 1 August 2019, the Court should hold that MLC had effectively abandoned any right to issue the subpoenas.

MLC's written and oral submissions summarised 15 MLC submitted that the two interlocutory applications are incompetent because of the doctrine of res judicata, relying on Forge. It emphasised that no relief was sought by Dr Quach with respect to the orders made on 20 November 2019 following Dr Quach's unsuccessful application for leave to appeal. MLC did not address the issue whether the doctrine of res judicata applies in interlocutory matters. 16 MLC denied Dr Quach's allegation that it had misled the Court. 17 In respect of Ms Oliver's advice to MLC, MLC submitted that the advice was not binding on it and, in any event, the statements made on page 4 were expressed in tentative and non-determinative terms. It further submitted that nothing said by Ms Oliver on page 8 of her advice was inconsistent with MLC's right to issue the relevant subpoenas. It submitted that the material sought by those subpoenas was adjectively relevant to the question of Dr Quach's medical condition.

Consideration and determination 18 At the commencement of the hearing, the Court drew to the parties' attention that neither party had provided the Court with copies of any of the subpoenas which were the subject of Dr Quach's challenge. The parties agreed, however, that it was sufficient for the Court to act upon the description of the relevant parts of the material in Dr Quach's fourth affidavit. Accordingly, I have proceeded on that agreed basis. 19 Dr Quach's challenge to the relevant subpoenas is based on several fundamental flaws. First, and foremost, Dr Quach urges the Court to proceed on the basis that Ms Oliver's legal advice to MLC was to accept liability for his claim for total disability. That is incorrect, as revealed in the extract set out at the beginning of Dr Quach's outline of written submissions (see [9] above). Ms Oliver simply advised that it was "arguable" that Dr Quach may have been totally disabled if he suffered in fact from Narcissistic Personality Disorder and that is a sickness, which sickness also caused the behaviour that gave rise to the finding of professional misconduct. Dr Quach has significantly overstated the terms and effect of Ms Oliver's advice. Moreover, there is no other material before the Court which supports his assertion that MLC had accepted liability for his claim. I consider that the subpoenas have been validly been issued because the material which they seek has sufficient adjectival relevance to the issue whether Dr Quach was unable to work due to the cancellation of his medical registration, as opposed to an illness. Ms Oliver's advice was not binding on MLC. In any event, her advice is not properly characterised as stating that MLC had to accept liability for his claim for total disability. Ms Oliver's advice on page 8 stated that there was no evidence of psychiatric diagnosis "at this point", but the balance of her advice indicates that she advised that further medical reports needed to be obtained, including from Dr Pethebridge and Dr St George. Nothing in Ms Oliver's advice provides a basis for setting aside the subpoenas or revoking leave. 20 Secondly, Dr Quach has misunderstood the relevance and application of Mason J's judgment in Minister for Aboriginal Affairs v Peko-Wallsend Ltd [1986] HCA 40; 162 CLR 24 at 45, where he said that decisions must be made on the basis of the most current material available to the decision-maker. That principle is a principle in public law which applies to decision-making by public administrative officials. It has no direct application in a private law case such as the one here. Nor does it have any application to a Judge exercising judicial power, contrary to Dr Quach's contention. Even if it did, I have explained above why I do not consider Ms Oliver's advice to MLC to have the effect asserted by Dr Quach. 21 Thirdly, I reject Dr Quach's submission that MLC reached its duty of utmost good faith under s 13 the Insurance Contracts Act 1984 (Cth) by withholding Ms Oliver's legal advice in the previous proceeding before me and the subsequent proceeding involving Dr Quach's application for leave to appeal before Rares J. Assuming for the moment that my judgment was correct in upholding MLC's claim for legal professional privilege, the assertion of such a privilege cannot be inconsistent with any duty of upmost good faith. In subsequently deciding to grant leave to appeal against my judgment, Rares J did not hold that the legal advice was not subject to legal professional privilege. Rather, the effect of the grant of leave to appeal was to have that matter heard and determined by a Full Court. In the events that occurred, this did not happen because, as was its right, MLC decided at that point to provide a copy of Ms Oliver's advice to Dr Quach, which rendered the appeal moot. None of that constitutes conduct on MLC's part which is in breach of the duty of utmost good faith. 22 Fourthly, I do not accept Dr Quach's submission that the Court was misled by MLC when it put forward as part of the basis for its application for the subpoenas to be issued that Dr Quach's claim was declined on the basis that, inter alia, he was unable to work due to the cancellation of his medical registration rather than an illness. Nothing in Ms Oliver's advice to which Dr Quach drew attention is inconsistent with that basis. 23 Fifthly, as to Dr Quach's complaint regarding the five and a half month delay after 1 August 2019 in MLC issuing the requests for subpoenas, I do not accept that this delay constitutes an "abandonment". As noted, it was not until 20 November 2019 that Dr Quach's application for leave to appeal against the orders dated 1 August 2019 was dismissed, with costs. No other recipient of a subpoena, apart from Dr Quach, has complained of delay. 24 Sixthly, Dr Quach's submissions as to why the Court should not apply Forge are misplaced. Contrary to Dr Quach's belief, the Federal Court is not a Court which is higher in the judicial hierarchy to the Supreme Court of NSW, including the Court of Appeal as part of that Court. Furthermore, s 109 of the Constitution has no application at all to what the Court of Appeal said there regarding the doctrine of res judicata. In any event, because the interlocutory applications will be dismissed on other grounds, it is unnecessary to determine whether they are incompetent on the ground asserted by MLC. I should add, however, that I see real difficulty with MLC's submission that the doctrine applies to an interlocutory judgment (see, for example, Zetta Jet Pte Ltd v The Ship "Dragon Pearl" (No 2) [2018] FCAFC 132; 265 FCR 290 at [14] ff per Allsop CJ, Moshinsky and Colvin JJ). 25 Seventhly, Dr Quach's contention that s 47(2) of the Insurance Contracts Act precludes MLC issuing and relying upon the relevant subpoenas is equally misconceived. That provision does not deny an insurer an entitlement to seek production of documents which are relevant to an issue as to whether the insured was suffering from a sickness or disability at the relevant time. 26 Eighthly, Dr Quach's contention that various of the subpoenas as identified by him in Table 2 of his affidavit dated 23 March 2020 should be set aside on the basis that they seek material made in "suits" between the State of NSW and Dr Quach, in which he says the Court has no jurisdiction, is equally misconceived. Section 38(b) (referred to by Dr Quach as s 38(2)) of the Judiciary Act 1903 (Cth) has no application to the circumstances here. This Court plainly has jurisdiction to hear and determine Dr Quach's application for relief in the substantive proceeding. In the exercise of that jurisdiction, a party to the proceeding is entitled to seek leave to issue subpoenas with a view to obtaining material even if it be the case that the material may happen to have been generated in the course of a dispute between Dr Quach and an arm or agency of the State of NSW. Nor does any issue arise as to any "jurisdictional fact" in the manner contended by Dr Quach. With respect, Dr Quach appears to misunderstand the doctrine of jurisdictional fact. 27 Ninthly, Dr Quach's interlocutory applications are not assisted by his submissions in relation to the letter of complaint from the Canberra Hospital to the NSW Medical Board which he said provided the genesis for the subsequent investigation. Dr Quach says that the Canberra Hospital has told him that it has no record of any such letter of complaint, which is supported by Dr Quach's affidavit of 13 February 2020. Dr Quach then invited the Court to make a ruling under its original jurisdiction which he says arises by operation of s 48AA of the Australian Capital Territory (Self-government) Act 1988 (Cth), so as to rule that there is no letter of complaint. Assuming, without deciding, that the Court has jurisdiction as contended by Dr Quach, I see no basis for making any such ruling. Merely because Canberra Hospital has said that it has no record of any letter of complaint does not mean that no such letter exists. In any event, the ruling sought by Dr Quach does not arise under either of his interlocutory applications. As shown in the extracts of the interlocutory applications at [2] and [3] above, the relief sought is limited to setting aside, or revoking leave to issue, subpoenas. 28 Dr Quach has not established any of his multiple grounds of challenge to the subpoenas.

Conclusion 29 For these reasons, the interlocutory applications will both be dismissed, with costs. I certify that the preceding twenty-nine (29) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Griffiths.

Insurance Contract Act 1984(Cth)

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Both interlocutory applications dismissed with costs

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