Finance Facilities Pty Ltd v The Commissioner of Taxation - [1997] FCA 409 - FCA 1997 case summary — Zoe

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Finance Facilities Pty Ltd v The Commissioner of Taxation

[1997] FCA 409

Federal Court of Australia|1997-04-08|Before: Beaumont J

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Source facts

Court

Federal Court of Australia

Decision date

1997-04-08

Before

Beaumont J

Source

Original judgment source is linked above.

Judgment (150 paragraphs)

[1]

CATCHWORDS Judicial review of an alleged failure to make a decision within a reasonable time - cancellation of approvals to a pharmacist in respect of premises under the National Health Act - Statutory construction - meaning of the word "may". Administrative Decisions (Judicial Review) Act 1977 s.7(1) National Health Act 1953 ss.90, 98, 99 Federal Court Rules Order 6 Rule 9 Finance Facilities Pty Ltd v The Commissioner of Taxation (1971) 127 CLR 106 The Secretary, Health, Housing, Local Government and Community Services v Kaderbhai (1994) 51 FCR 416 General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125 W H SOUL PATTINSON & CO LTD v THE SECRETARY, DEPARTMENT OF HEALTH AND FAMILY SERVICES & ORS No. NG957 of 1996 BEAUMONT J. SYDNEY 8 APRIL 1997

[2]

IN THE FEDERAL COURT OF AUSTRALIA ) NEW SOUTH WALES DISTRICT REGISTRY ) No. NG957 of 1996 GENERAL DIVISION ) BETWEEN: W H SOUL PATTINSON & CO LTD Applicant AND THE SECRETARY DEPARTMENT OF HEALTH AND FAMILY SERVICES First respondent THE AUSTRALIAN COMMUNITY PHARMACY AUTHORITY Second respondent EDWARD ROSS BROWN, JOHN KEVIN BRISLAN AND ELENA KRIVOSHEV Third respondents CORAM: BEAUMONT J. WHERE MADE: SYDNEY DATE: 8 APRIL 1997 MINUTES OF ORDERS ON 8 APRIL 1997 THE COURT ORDERS: 1. The notice of motion filed by the second respondent on 18 February 1997 is dismissed with costs. ON 10 APRIL 1997 THE COURT ORDERS: 1. It be noted that the first respondent undertakes to make no decision to cancel approval for the Blacktown premises for the time being. 2. The first respondent to make the relevant decision with respect to the Strathfield Plaza premises within a reasonable time which in the circumstances outlined by the first respondent is 28 days. 3. The first respondent to make the decision whether or not to cancel the third respondents' approval pursuant to s.98 of the Act on or before 9 May 1997. 4. The first respondent to pay the applicant's costs of the final hearing on 21 March 1997, the costs of taking judgment on 8 April 1997 and the costs of 10 April 1997. Costs of the final hearing include the preparation of affidavit evidence relied on in the final hearing. 5. The applicant to pay the first and second respondents' costs of the directions hearing on 13 January 1997. 6. Costs orders may be set-off against each other. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

[7]

The provisions of s.90(1), (2), (3), (3A), (3AA), (3AB), (3B), (4), (5) and (6) of the Act are as follows: "90. (1) Subject to this section, the Secretary may, upon application by a pharmacist who is willing to supply pharmaceutical benefits on demand at particular premises, approve that pharmacist for the purpose of supplying pharmaceutical benefits at or from those premises. (2) Where a pharmacist desires to supply pharmaceutical benefits at or from several premises (being premises at which he or she carries on, or is about to carry on, business as a pharmacist) a separate application shall be made in respect of each of the premises and, where approval is granted in respect of 2 or more premises, a separate approval shall be granted in respect of each of the premises. (3) Subject to this section, where an approved pharmacist desires to supply pharmaceutical benefits at or from premises (being premises at which the pharmacist carries on, or is about to carry on, business as a pharmacist) other than premises in respect of which approval has been granted, the Secretary may on application by the approved pharmacist, grant approval in respect of those other premises. (3A) Subject to subsection (3AA), an application under this section must be referred to the Authority. (3AA) Subsection (3A) does not apply to an application for an approval arising out of a change in the ownership of a pharmacy situated at particular premises if the change results or resulted from: (a) the sale of the pharmacy; or (b) the death of the owner or one of the owners of the pharmacy; or (c) a change in the constitution of a partnership that owned the pharmacy; if the pharmacy is to continue to operate at the same premises. (3AB) In subsection (3AA): 'pharmacy' means a business in the course of the carrying on of which pharmaceutical benefits are supplied. (3B) An approval may be granted under this section in respect of an application to which subsection (3A) applies only if the Authority has recommended the grant of the approval, but the Secretary may refuse to grant an approval even if the grant has been recommended by the Authority. .... (4) Nothing in this section authorizes the Secretary to grant approval to a pharmacist in respect of premises at which that pharmacist is not permitted, under the law of the State or Territory in which the premises are situated, to carry on business. (5) Where the Secretary makes a decision granting or rejecting an application made by a pharmacist under this section, the Secretary shall cause to be served on the pharmacist, notice in writing of that decision. ..... (6) For the purposes of this section, a reference to a pharmacist is taken to include a reference to a person who owns, or is about to own, a business for the supply of pharmaceutical benefits at or from particular premises." The second respondent is the Australian Community Pharmacy Authority ("the Authority"): s.84(1) of the Act. The functions of the second respondent, inter alia, are (a) to consider applications under s.90; and (b) to make, in respect of an application under s.90 - (i) a recommendation whether or not the applicant should be approved under that section in respect of particular premises; and (ii) if an approval is recommended - recommendations as to the conditions (if any) to which the approval should be subject.

[73]

"Re: NA209 Application to Relocate to Strathfield Plaza The above application will be dealt with by the ACPA at their January meeting. As there has been a delay in hearing this application it is now necessary to substitute the section 98 Request for Cancellation of Approval. The new section 98 is for the relocation of the pharmacy currently situated at premises at shop 4/5 Patrick Mall Patrick St Blacktown 2148. In order to satisfy paragraph 7(a)(iv) of PB22 of 1996 there are 2 pharmacies located within 200 metres at the Westpoint Marketown Shopping Centre one of which is Nightingales AMCAL Chemist. Within 200 metres in the opposite direction there is Everyday and Night Pharmacy. A map is enclosed detailing the location of the pharmacies. Would you please alter your records to show the substituted section 98. I am sending a copy of this letter to the ACPA." In the affidavit sworn 28 February 1997 Ms Mihulka went on to say: "11. Annexed hereto and marked 'C' is a copy of a letter dated 7 January 1997 from Messrs Cutler Hughes & Harris to J Tucker Esq, the Manager for Government Programmes for the First Respondent. I was aware from the terms of that letter that there was an agreement as between the Applicant and the holders of the Brown Approval to the effect that the holders of the Brown Approval would apply to relocate their approval number from the Premises to another location in time for the 21 January 1997 meeting of the ACPA. 12. I expected that an application would be made by the holders of the Brown Approval to relocate in accordance with the letter which is annexed in my previous paragraph. On or about 21 January 1997, I had a conversation with Ms Merelyn Woodward, the secretary of the Second Respondent, in words to the following effect: I said: 'Did Soul's application receive a positive recommendation?' She said: 'No. It has been deferred.' I said: 'Why?' She said: 'There was a problem with the Brown Application concerning the place that they were relocating to.' 13. In a later conversation, I believe several days after this one, Ms Woodward and I had a further conversation in words to the following effect: I said: 'Can you tell me something more about why the decision was deferred.' She said: 'I believe that there was a problem with the legal right to occupy the premises to where the approval number was to move.' 14. On or about 30 January 1997, I had a conversation with Ms Dallas Wong of the First Respondent in words to the following effect: I said: 'Can you tell me where the Brown Application is being relocated to?' She said: 'I can't because of confidentiality reasons.' I said: 'Yes you can, because surrounding pharmacies would have been notified of that address and the information would have become public knowledge.' She said: 'Our records indicate that the relocation is to Raw Place, Strathfield. It relates to a development being done by Meriton, which has not yet commenced. The building has not been built.' 15. I subsequently made some enquiries concerning the Raw Place address. On 30 January 1997, I telephoned the Town Planning Department of Strathfield Council. I spoke to a person whose name I do not recall and we had a conversation in words to the following effect: I said: 'Can you tell me what the status of the Development Application is for Raw Place, a development which I understand is being conducted by Meriton.' She said: 'The Development Application was approved on 10 December 1996. The Building Application has not yet been granted.' I said: 'When do you think it will be granted?' She said: 'There is no guarantee that it will [be] granted at all. The earliest it will be granted would be June 1997.' 16. If the Applicant's Application to relocate from Blacktown to the Premises is not approved then the Blacktown premises will be demolished and the Applicant will no longer satisfy the requirements of Section 90 of the National Health Act, 1953. As a result, the Applicant's approval number, which is currently valued at $80,000, is liable to be revoked by the First Respondent. 17. I believe that unless an approval is given for the relocation from the Blacktown premises to the Premises, the Applicant runs the same risk that the Brown Approval faces, namely that its approval number will be cancelled by the First Respondent because the approval number is no longer attached to suitable premises..."

[75]

"SHOPS 15 AND 16 STRATHFIELD PLAZA, STRATHFIELD We refer to the proposal contained in our letter to you of 7 January 1997, as endorsed by the solicitor for the Brown Partnership. Such proposal was predicated upon a representation by the Brown Partnership to our client, W H Soul Pattinson & Company Limited, that the Brown Partnership had secured premises at 12-34 Albert Road, Strathfield, to which it could relocate its approval number from Shop 15, Strathfield Plaza, Strathfield. It has subsequently come to our client's attention that in fact the Brown Partnership does not have a right to occupy such premises and that, indeed, the application by the Brown Partnership to relocate its approval number was not approved for this reason. If our client had been made aware that the Brown Partnership did not in fact have a right to occupy the premises to which it intended to relocate its approval number, our client would not have entered into the proposal contained in the letter of 7 January 1997, which proposal included a request to you not to make a decision on 9 January 1997 with regard to the cancellation of the Brown Partnership's approval number. As we understand it, the ACPA declined the Brown Partnership's application based on the abovementioned deficiency and was therefore not able to consider our client's application to relocate into Shops 15 and 16 Strathfield Plaza, Strathfield at it[s] meeting on 23 January 1997. It is and has been our client's intention to relocate its approval number from premises at Blacktown into Shops 15 and 16 at Strathfield Plaza. Our client's lease of its Blacktown premises is due to expire in mid-February and our client now faces a situation where in the event it will be required to vacate those premises, it will not have premises to which it can relocate. Accordingly, as the proposal contained in the letter to you of 7 January 1997 cannot be implemented for reasons outlined above, our client requests that you proceed to make a decision with respect to cancellation of the Brown Partnership's approval number. Would you kindly advise us by return facsimile of the date upon which you would intend making such decision. Obviously, if our client is unable to relocate to the Strathfield premises once it has been required to vacate the Blacktown premises, our client will suffer substantial damages as a result of the loss of its business, in addition to the loss of profit suffered to date as a result of having been unable to relocate into the premises at Strathfield. For this reason, it may be necessary for our client to continue to pursue proceedings already on foot in the Federal Court (NG957 of 1996) in order to seek appropriate relief. We await hearing from you." Mr Deutsch went on in his affidavit to say: "10. On 24 February 1997, I was informed by Mr Greg Peek of the Australian Government Solicitor's office, the solicitor for the First and Second Respondents, and verily believe that: (i) on or about 20 February 1997, the Second Respondent recommended relocation of the Third Respondent's approval from the Premises; and (ii) on or about 20 February 1997, the Second Respondent conditionally recommended relocation of the Applicant's approval to the Premises, the condition being that the Applicant could not relocate until the Third Respondents had physically relocated from the premises. 11. It is my understanding, based upon certain matters discussed with Mr Peek of the Australian Government Solicitor's office, that the First Respondent would not make a decision as to whether to relocate or revoke the Third Respondents' approval until such time as the Third Respondents had requested it to do so and that the Third Respondents are not required to in fact make any such request for a period of six months after the recommendation of the Second Respondent." Further evidence of the complicated background to the litigation is provided by the affidavit of John Doidge Tucker. Mr Tucker is the Manager, Pharmaceutical Benefits Branch, HIC, a position delegated to exercise the powers of the Minister under s.98(3) of the Act.

[85]

"Policy Proposal 13. There are two practical issues that need to be dealt with: · quarantining this from other pharmacies whose proprietors may seek to temporarily close for reasons of convenience (for example, to take a holiday); and · ensuring that the temporary closure does not extend to an unconscionably long period. 14. The first can be dealt with on a differential policy based upon the fundamental difference between the sale/relocation process and the would-be temporary closure of an otherwise stable pharmacy. The sale/relocation is a legitimate transaction which may, for practical and unavoidable reasons, result in an interval of no trading. As you have pointed out, the relocation means that the area from which the pharmacy is being relocated is going to be deprived of the pharmacy's services in any case; whether sooner or later is of relatively little import. None of these considerations apply to the holiday closure. 15. The second point above is more difficult. We do not want to be in a position of agreeing to a, say, three month closure and then for various reasons having this extended, piecemeal to eighteen or more months. On the other hand, having allowed time (and thereby implicitly recognising that the community can do without the services of the pharmacy for some time), it would be difficult to refuse to allow further time if some unforeseen delay (for example, in the construction of the new premises) occurs. 16. I think we can reduce these problems by: · granting a delay only upon receipt of both: · evidence provided by the applicant that the new premises will be available for occupation within six months of the approval being granted for the sale of the old premises; and · an undertaking by the applicant that he or she will be conducting the business of a pharmacy from those premises within that same period of six months; and · granting an extension of up to a further six months only upon the production of compelling evidence that the delays were due to factors outside the applicant's control. 17. The evidence in both cases would need to be letters from the developers of the premises. A delay outside the applicant's control would not include financial matters such as being unable to obtain finance, dispose of old premises or whatever. They would be limited to such matters as delays in the building of a shopping mall or medical centre where the pharmacist is not an owner of the development, or a part owner with significant control. Any further extensions would only be granted in Central Office by the Manager, Pharmaceutical Program Branch, upon being convinced that the extension was appropriate in the circumstances."

[89]

· On 2 December 1996 Mr Tucker wrote a letter to the third respondents as follows: "Thank you for your letter of 26th November in which you sought an extension to the suspension of your approval to supply pharmaceutical benefits at Shop 15 Strathfield Plaza, Strathfield, NSW. In the HIC's letter of 28th October you were advised that suspensions are a temporary facility and your approval was suspended for 30 days from 28th October & you were requested to notify the HIC of your plans for its eventual direction. You have advised the HIC in your letters that the pharmacy, Approval No. 10155L is closed. It is also noted that you state you do not have a lease or any other tenancy agreement for the premises named in Approval No. 10155L nor have you submitted an application for relocation to any site at which you have a legal right to operate a pharmacy. According to section 98(3) of the National Health Act 1953 the Secretary, of whom I am delegate, may now cancel your approval. Section 98(3) states 'Where the Secretary is satisfied that an approved pharmacist is not carrying on business as a pharmacist at premises in respect of which the pharmacist is approved, the Secretary may, by notice in writing to the pharmacist, cancel the approval of the pharmacist under section 90.' I have extended your approval until December 14th 1996. Please show cause by that date why your approval should not be cancelled pursuant to section 98(3) of the National Health Act 1953." · On 13 December, 1996, Mr Tucker received a letter from Mr Brown dated 11 December 1996 as follows: "Thank you for your letter of 2 December 1996 in which you sought further information regarding proposed use of our approval to supply pharmaceutical benefits at shop 15 Strathfield Plaza. Our approval should remain suspended as: a. The managing agents of Strathfield Plaza have stated that the premises is not yet leased and that our application is well in the running to be accepted. b. The premises is still in a state of reconstruction. It is still impossible to establish a pharmacy in this location as there is no ceiling, lighting, shopfront or security for pharmaceuticals. Little or no work appears to have been done to the premises for over one month, during which time Strathfield Plaza building effort has been concentrated on getting Franklins enlarged, refurbished and re-launched as Franklins Fresh.

[90]

c. The best opportunity for us to relocate is in a new development being conducted by Meriton Apartments Pty Ltd. This 250 home unit tower block is situated between Strathfield Plaza and Strathfield Railway Station, the ground floor of which will include 12 shops. We have to-day been advised by the developer that these shops will not be leased but will be made available for purchase off the plan. We were also told that we could not be advised of final details including prices, until these are established by the end of January 1997. Indicative prices and details were discussed. This opportunity is both real and realistic and concrete negotiations will commence as soon as possible. For these reasons and bearing in mind the likely construction industry slow down during the festive season and in January, we request your favourable consideration of an extension of our approval suspension. Thanking you for your valued consideration of this matter and wishing you the compliments of the season." · On 16 December 1996, Mr Tucker replied to the third respondents by letter in these terms: "I refer to your letter dated 11 December 1996, a copy of which you relayed to me via facsimile on 13 December 1996. Before I am able to make a decision, I require additional information. You state that the premises in Strathfield Plaza has not been leased, and that the managing agents have advised you that your application is being considered and has the possibility of being accepted. I would be grateful if you could provide me with written verification from the managing agents that you have in fact made an application in respect of the premises, the nature of that application, whether that application is being considered favourably, and when a decision in respect of the tenancy of the premises will be made. You have further advised that you are considering the purchase of premises in a new development being conducted by Meriton Apartments Pty Ltd. Could you please provide a letter from the developer verifying the availability of shops in the new development, and an anticipated date for the completion of the new premises. I would ask that the above information be provided to me as soon as possible, and in any event, no later than 23 December 1996. I look forward to hearing from you." (Mr Tucker said in his affidavit that, based on the information available to him at that time, he was uncertain about whether the third respondents had a legal right to occupy the premises, and that he was concerned to give the third respondents every reasonable opportunity to establish that right before proceeding to cancel the approval.)

[118]

"These submissions require consideration of s 90(4), which is a curiously worded provision. It does not say that the Secretary shall not approve a pharmacist whose premises are not approved and who is not registered as the owner of the relevant business under State or Territory law relating to control of pharmacies. At first glance it may seem to amount to no more than an expression of intention that the Act should not displace any such State or Territory law in accordance with s 109 of the Constitution. The Secretary, however, evidently takes the view that s 90(4) operates as a limitation on power and that an applicant must show that he is permitted under a law, such as the Pharmacy Act, to carry on business at the premises in respect of which approval is to be granted.. The Secretary is plainly correct. The expression 'Nothing in this section authorizes' signals a limitation on power. This expression is similar to the language limiting the legislative power of the Parliament employed in s 51 (xxiiia ) of the Constitution. The permission contemplated by s 90(4) must be specific to 'that pharmacist' in respect of the premises for which approval is to be granted. The permission required is not of a town planning or land use type, which would relate only to the premises." In essence, the argument for the applicant was centred on the notion that the circumstances of the present case required that the discretion be exercised, and reference was made to the observations of Windeyer J. in Finance Facilities Pty Ltd v The Commissioner of Taxation (1971) 127 CLR 106 (at 134-5) as follows: "The question then is, must the permitted power be exercised if one of those conditions be fulfilled? This does not depend on the abstract meaning of the word 'may' but of whether the particular context of words and circumstance make it not only an empowering word but indicate circumstances in which the power is to be exercised - so that in those events the 'may' becomes a 'must'. Illustrative cases go back to 1663: R. v. Barlow. Today it is enough to cite Julius v. Bishop of Oxford; and add in this Court Ward v. Williams. But I select one other reference out of a multitude: Macdougall v. Paterson. There Jervis C.J. said in the course of the argument 'The word 'may' is merely used to confer the authority: and the authority must be exercised, if the circumstances are such as to call for its exercise'. And, giving judgment, he said: 'We are of opinion that the word 'may' is not used to give a discretion, but to confer a power upon the court and judges; and that the exercise of such power depends, not upon the discretion of the court or judge, but upon the proof of the particular case out of which such power arises.' I consider that to be directly applicable to the present case. If the Commissioner, having considered the matter, is satisfied of facts out of which the power to allow a rebate arises, he cannot nevertheless refuse to allow it."

[125]

"Although s 78 does not contemplate the removal, from the constitution, articles or rules of an organisation, of a provision which has had some period of operation, the question remains whether the veto upon the coming into effect of a change, for which it does provide, may be the subject of indefinite delay. That would be a highly inconvenient view. It would mean that the organisation, having notified the Minister in accordance with the Act, would thereafter always have to conduct its affairs under the sword of Damocles of the possible formation of an adverse ministerial opinion. In the case of some rule changes, this might be very destabilising. If the Minister is not bound to form his opinion within a reasonable time, the organisation could do nothing about it. But upon a long delayed opinion being formed, the disallowance ab initio which would be involved might lead to the necessity to reassess numerous claims spanning a period of, perhaps, years." (b) (i) The first respondent's written submissions Counsel for the first and second respondents handed up a chronology of events which is a convenient summary. It is annexed to these reasons. Again, it provides a perspective on the evolution of the dispute and of its complications, hopefully a rare occurrence in these matters. Counsel then outlined his client's submissions as follows: "Preliminary issue 1. The application is misconceived and fails at the threshold. Section 98(3) of the National Health Act 1953 ('the Act') confers a discretion or a power, but not a duty. Whether an Act confers a duty which must be exercised if the circumstances call for its exercise, or conversely confers a discretion, is to be determined by reference to the language, structure and purpose of the Act: Wamba Wamba Aboriginal Land Council v Minister Administering the Aboriginal and Torres Strait Islander Heritage Protection Act (1989) 23 FCR 239 at 246.8, per Lockhart J. 2. Section 98(3) manifestly confers a discretion. It uses the term 'may', which is a strong prima facie indication of a discretion, rather than a duty: see Finance Facilities Pty Limited v Commissioner of Taxation (1971) 127 CLR 106 at 134, per Windeyer J. 3. The use of the term 'may' in s 98(3) is in sharp contrast to the use of the mandatory 'shall' in 98(1) and 98(4). Those two sub-sections require the exercise of the power which each confers. The intervening sub-sections, s98(2), (3) and (3A), by contrast use the discretionary 'may'. 4. This careful scheme of distinction between mandatory duties and discretionary powers is used consistently elsewhere within the Act: see, for example, the discretionary power conferred by s 95(1) and compare the mandatory duty conferred by s 95(5). A similar distinction is apparent in the different subsections of s90 of the Act. 5. Unless the person has a duty to make a decision to which the ADJR Act applies, there is no basis for an application under s 7 of that Act: see s 7(1)(a) and s7(2)(a) and Brownsville Nominees Pty Limited v FC of T (1989) 19 FCR 169 at 173.9, per Northrop J. Unreasonable Delay 6. There is no evidence to justify a finding that there has been unreasonable delay in making the decision. The first respondent has obligations not only to the applicant under the Act, but also to the third respondents, who presently hold an approval in respect of the premises. A decision to cancel a pharmacist's approval under s98(3) is subject to a right of merits review to the Administrative Appeals Tribunal: see s105AB(8A). 7. The question whether to cancel has in fact received diligent attention. Any delay in reaching a final decision as to whether to cancel the approval has been occasioned by the need to afford procedural fairness to the third respondents, and by the action of the applicant itself. There can be nothing unreasonable in a decision-maker deferring a decision in order to give those whose legal rights are affected by it the opportunity to be heard. 8. The test of 'unreasonable delay' is a high one: see Thornton v Repatriation Commission (1981) 35 ALR 485 at 490, per Fisher J. See also Raw v Pharmacy Restructuring Authority (1993) 30 ALD 376; Rogers v Australian Community Pharmacy Authority (1996) 42 ALD 1; Kelly v Watson (1985) 64 ALR 113)." (ii) The first and second respondents' initial oral submissions

[131]

"Timing 1. The affidavit of Mihulka sworn on 28 February 1997 indicates that on 12 April 1997 the applicant will be required to vacate its premises at Blacktown (paragraph 10). The second respondent did at its meeting on 23 February 1997 recommend the approval by the first respondent of the applicant's application to relocate its approval to dispense pharmaceutical benefits under the National Health Act ('the Act') from the Blacktown premises to the premises at Strathfield Plaza ('the Premises') conditional upon the removal (either by revocation or relocation) of the third respondent's approval number from the Premises. 2. No decision is now required to be made by the second respondent in order for the first respondent to approve the relocation of the applicant under section 90 of the Act. Upon the condition being satisfied, the approval will become unconditional. 3. The result is that the deadline of 25 March 1997 is not now critical. Rather, from the applicant's point of view, it is essential that a decision be made by the first respondent prior to 12 April 1997. Application under section 7 of the Administrative Decisions (Judicial Review) Act 4. The policy underlying the scheme for the dispensation of pharmaceutical benefits under the Act is the maintenance of an effective, efficient and well distributed community pharmacy service in Australia (The Pharmacy Guild of Australia v Australian Community Pharmacy Authority, unreported, Branson J, 20 November 1996 at 7.8 and 21.8 - 22.2). 5. It is inconsistent with this policy to permit approval numbers granted under section 90 of the Act to remain unused or to allow the existence of an unused approval number to prevent the use of particular premises which are suitable for the dispensation of the benefits. 6. Section 90 of the Act expressly requires that approval numbers relate to 'particular premises' (ss 90(1), (2), (3), (3AA) and (4)). It has been recognised that the requirement that the applicant for approval operate from particular premises is significant requirement to the scheme of the Act. 7. The words of section 98(2)(a) and 98(3) of the Act confer a power and a duty upon the first respondent to make a decision in accordance with the principles set out in Julius v Lord Bishop of Oxford (1880) 5 AC 214 at 222-223). 8. They should be taken in the context of the grant of approvals themselves. Section 90 and the Determination made under section 99L of the Act (which is exhibit 1) emphasise the strong relationship between premises and the grant of approvals - see Secretary, Department of Health, Housing, Local Government and Community Services and Anor v Kaderbhai (1994) 51 FCR 416 at 419G, 422A-E. 9. It could not have been intended by parliament that upon the satisfaction of the criteria set out in sections 98(2)(a) and 98(3) (that is, the notification to the first respondent that the pharmacist has ceased to carry on business as a pharmacist at the premises) the Secretary could decline to cancel the approval number. 10. In the circumstances, it is submitted that the word 'may' must confer upon the first respondent a duty to make a decision - Windeyer J in Finance Facilities Pty Limited v Federal Commissioner of Taxation (1970) 127 CLR 106 at 134-135. 11. It is further submitted that in the circumstances of this case, the first respondent has unreasonably failed to make a decision. Where a statute is silent on the question of time in which an act is to be performed, it is usually inferred that the decision should be made within a reasonable time - BTR v Westinghouse Brake and Signal Company (1992) 34 FCR 246 at 253.3 & 272.9 - 273.1 per Lockhart, Hill and Beaumont JJ; Neal v Commissioner for Superannuation (1987) 76 ALR 281 at 290 - 291). 12. It is submitted that upon receipt of clear evidence that the third respondents had no possibility of returning to the premises at Strathfield Plaza ('the Premises'), the first respondent ought to have made its decision. 13. The requirements of both section 98(2)(a) and section 98(3) of the Act were satisfied by provision of the information contained in the third respondent's facsimile of 9 October 1996 (annex A to Tucker). 14. To the extent that it was reasonable for the first respondent to obtain confirmation that the third respondent had no entitlement and would obtain no entitlement to reoccupy the Premises, that confirmation was provided in the third respondent's lengthy letter of 15 October 1996 (annexure C to Tucker at paragraphs 6, 10, 16, 24 and 27). That letter stated that the landlord had refused them a further lease; a later letter from the third respondents (Annexure F to Tucker dated 26 November 1996) indicated that their 'preferred position' was to keep the approval number at the Premises, a position which was clearly untenable and which the first respondent should have realised was untenable. 15. The alternative suggested in the letter of 26 November was a relocation to premises which were then yet to be built. A request was made for a suspension of the approval number for 12 months. 16. The Act provides no facility for the 'suspension' of approval numbers. On 27 November the applicant notified the first respondent of its interest in the Premises and the reason why it was concerned that the third respondent's approval number not be permitted to remain (Annexure I to Mihulka's affidavit of 10 December 1996). 17. Notwithstanding the singular failure of the third respondent to provide any documentation to support its contentions as to entitlement to remain at the Premises or move to elsewhere (annexure I to Tucker dated 10 December 1996) the third respondent continued to defer making a decision under the Act. 18. It is submitted that the proposal contained in the agreement between the applicant and the third respondents (annexure C to Deutsch's affidavit) provides no justification for the continued failure of the first respondent to make a decision (paragraphs 24 and 25 of Tucker affidavit). The letter from the solicitors for the first applicant to the first respondent dated 31 January 1997 (annexure E to Deutsch) sets out the position." (d) The first and second respondents' supplementary written arguments The first and second respondents made the following further written submissions:

[132]

"1. As to paragraph 2 of the applicant's submissions the second respondent has no determinative powers in relation to relocations, but merely recommendatory powers. The first respondent has a discretion whether to accept the recommendation, and may refuse to grant the approval even if recommended: s90(3B). 2. The judgment of Windeyer J in Finance Facilities Pty Limited v Federal Commissioner of Taxation (1970) 127 CLR 106 at 134-135 does not support the proposition for which it is cited in paragraph 10. Finance Facilities, and the cases which it cites, establish that in some statutes the word 'may' means 'must' if the statutory preconditions are satisfied. In the context of s 98(3), that would mean 'must cancel', not 'must decide whether to cancel'. Subsection 98(3) is not, in any event, a provision of the kind referred to in the passages cited in Finance Facilities. 3. The construction for which the applicant contends in paragraphs 9 and 10 is inconsistent both with the careful distinction drawn in the use of 'may' and 'shall' in the various sub-sections of s 98, and also with the obvious need for the cancellation power to be discretionary. If it were non-discretionary, temporary cessations, for example, would lead to the mandatory cancellation of the approval. 4. As to paragraph 11, BTR v Westinghouse Brake concerned the time within which an undoubted statutory duty was to be performed. The respondents submit there is no duty here. The passage relied upon from Neal v Commissioner for Superannuation is a minority view in that case, with respect. 5. As to the suggestion that it was clear from 9 October 1996 that the third respondents had no possibility of returning to the premises, that contention was contrary to the third respondents' assertions to the first respondent. The lease which the applicant claimed to have to the premises in the 27 November 1996 letter (annexure K, p 25, to affidavit of Mihulka sworn 10 December 1996) was unexecuted: see p 32 to those annexures. It was reasonable, indeed necessary, that the third respondents be given the opportunity to make good those assertions prior to a decision being reached to cancel a commercially valuable approval. 6. The actual relocation upon which the applicant relies in the case was not sent until 2 January 1997 (see annexure B to the affidavit of Mihulka sworn 28 February 1997, and the following page). By 8 January both the applicants and the third respondents had asked the first respondent to defer consideration of the matter. 7. By the time the applicant wrote on 31 January seeking to cast doubt upon the basis upon which its agreement to that course had been obtained, the second respondent had decided to consider the relocation applications at its 20 February meeting, and did so (affidavit of Deutsch, paragraph 10). It is entirely reasonable that the first respondent should defer consideration of whether to cancel the approval when an application for relocation is pending before the second respondent, to be decided within three weeks. 8. Given the factual material and legal complexity of the applications for relocation made on behalf of the applicant and the third respondents, there has been no failure to decide within a reasonable time whether to cancel the approval, even if there be a duty to do so."