Lee v Napier [2013] FCA 236 | Case summary

Lee v Napier [2013] FCA 236 | Case summary | Zoe

[16]

REASONS FOR JUDGMENT 1 Part VAA of the Health Insurance Act 1973 (Cth) ("the Act") establishes a scheme for reviewing and investigating the provision of services by medical practitioners and other health service providers. The scheme, which took effect from 1 July 1994, is known as the Professional Services Review Scheme. Investigations are initiated by a referral by the Director of Professional Services to a Committee, known as the Professional Services Review Committee. Committee members must belong to professions or specialties relevant to the investigation. Membership is drawn from a Panel called the Professional Services Review Panel. If a Committee finds that the person whose conduct is under review has engaged in "inappropriate conduct" as defined in s 82 of the Act, it is required to report that finding to the Determining Authority, which decides what action to take. 2 Appointments of medical practitioners to the Panel are made by the Minister for Health. They may only be made after the Minister has consulted the Australian Medical Association ("AMA"). In Kutlu v Director of Professional Services Review (2011) 197 FCR 177 ("Kutlu") the Full Court considered the consequences of a failure to consult. This judgment is concerned with the meaning and scope of the consultation requirement. 3 The applicant, Dr Il-Song Lee, is a general practitioner. By an application filed on 2 June 2010 Dr Lee sought judicial review of decisions made by a Professional Services Review Committee ("the Committee"), various other individuals with statutory responsibilities under the Health Insurance Act 1973 (Cth) and the Commonwealth of Australia (NSD 622 of 2010). The Committee found that he had engaged in inappropriate practice (an expression defined in the statute) in connection with certain services for which he claimed and received a benefit under the Medical Benefits Scheme. Consequent upon that finding the Determining Authority directed that Dr Lee be disqualified from providing certain MBS service items for six months, that he repay about $38,000 in Medicare benefits, and that the Director reprimand and counsel him. 4 On 2 February 2011 Dr Lee successfully applied to amend his application to challenge the validity of the appointment of the Committee's chair (Robyn Napier) to be a Deputy Director of Professional Services Review, all the decisions made by the Committee, the conduct of the Director in purporting to constitute the Committee and referring Dr Lee's conduct to it for investigation, and the consequential actions of the responsible Minister and/or the Commonwealth. 5 At around the same time, similar challenges were made in a number of other cases involving decisions by other Committees, concerning both Dr Lee and several other medical practitioners. The common question for determination in those cases was referred to a Full Court to be heard as a special case on the basis of agreed facts. As there was a dispute in the present case about whether or not consultation had in fact taken place, it was not included in the special case. In Kutlu the Full Court upheld the challenge, finding that the constitution of the various Committees and their draft and final reports were invalid. The High Court granted special leave to appeal, but the Commonwealth later agreed (at least in Dr Lee's earlier two cases) to abide the outcome of the Full Court decision. As a result, I made orders by consent setting aside the various decisions that Dr Lee had sought to impugn. At about the same time the Parliament enacted legislation to retrospectively validate all other appointments: Health Insurance Amendment (Professional Services Review) Act 2012 (Cth). On its face, that legislation (which commenced on 27 June 2012) and more particularly Sch 1 item 1, applies to this case. If it does apply, the challenge to the validity of the various appointments here would be doomed to fail. Nevertheless, Dr Lee would not be cowed. 6 On 26 July 2012 Dr Lee filed a writ of summons in the High Court claiming declarations that Sch 1 item 1 of the amending legislation is not a valid law of the Commonwealth because it usurps its judicial power and is outside its legislative power. But the constitutional challenge presupposes the invalidity of the appointments, an issue yet to be determined. Consequently, on 18 September 2012 Gummow J remitted the High Court challenge to this Court (where it became NSD 1447 of 2012). 7 By consent, and on the application of the parties, I ordered that the questions of the validity of the appointments and the constitutional validity of the amendments be heard separately from any other questions in the proceedings pursuant to r 30.01 of the Federal Court of Australia Rules 2011 (Cth). By agreement the separate questions will be heard in sequence, the latter only in the event that the appointments are found to have been invalid. If the appointments are invalid, the invalidity will be cured by the amending legislation unless the legislation is unconstitutional. Logically, then, the question of invalidity is the first question that arises and it is with this question that this judgment is exclusively concerned. 8 The precise question for determination at this time is whether the members of Professional Services Review Committee No 525 ("PSRC No 525") - Dr Robyn Napier, Dr Rodney McMahon and Dr Huy An - were not validly appointed to the Professional Services Review Panel because the Minister failed to consult with the AMA as mandated by s 84(3) of the Act before making the appointments to the Panel. 9 The Commonwealth seeks to uphold the appointments, maintaining that consultation took place. It accepts that if Dr Napier's appointment as a Panel member is invalid, then so too is her later appointment as Deputy Director.

[17]

The provisions in question 10 The Professional Services Review Scheme appears in Pt VAA of the Act. It was inserted into the Act by the Health Legislation (Professional Services Review) Amendment Act 1994 (Cth). It came into force on 1 July 1994. 11 The Professional Services Review Scheme is a scheme for reviewing and investigating the provision of services by a person to determine whether the person has engaged in inappropriate practice. The scheme was described in detail in Kutlu. Its main features are summarised in s 80(2)-(12) of the Act. It is not necessary to refer to all of those features here, but it is useful to refer to some. 12 The Scheme applies to all persons who render or initiate services for which a Medicare benefit is payable and services rendered by way of a prescribing or dispensing of a pharmaceutical benefit (see s 81). The express object of Pt VAA is to protect the integrity of the Commonwealth Medicare and pharmaceutical benefits programs and in so doing to protect, first, patients and the community in general from the risks associated with inappropriate practice and, secondly, the Commonwealth from having to meet the cost of services provided as result of inappropriate practice (s 79A). The Explanatory Memorandum to the Amendment Bill states that it was part of a package of measures designed to reduce medical fraud and over servicing and to provide for "an enhanced peer review scheme". 13 Part VAA establishes the positions of Director of Professional Services Review, a Professional Services Review Panel, Deputy Directors (who must be Panel members) and a Determining Authority, and gives the Director the power to set up Committees and to appoint their members. Committees are established from time to time to investigate individual cases. All the other appointments are made by the Minister. The Director cannot be appointed unless the AMA agrees. In the case of the Deputy Directors and Panel members, the appointments cannot be made without the Minister consulting the AMA. 14 The investigation process is triggered by a request from the Health Insurance Commission to the Director to review the provision of services by a person. The Director must then decide whether to carry out a review. After a review the Director may decide to take no further action, enter into an agreement with the person under review or make a referral to a Committee. A referral to a Committee initiates an investigation by the Committee into the provision of the services specified in the referral. The members of a Committee are constituted by a Deputy Director (who chairs the Committee), two other Panels and, in the Director's discretion, up to two additional Panel members (s 95). Committee members must belong to professions or specialties relevant to the investigation (s 80(7)). 15 The relevant section of the Act is s 84, more specifically ss 84(3). At all material times it provided: Section 84 - The Professional Services Review Panel (1) The Professional Services Review Panel is established. (2) It consists of practitioners appointed by the Minister. (3) Before appointing a medical practitioner to be a Panel member, the Minister must consult the AMA. The Minister must make an arrangement with the AMA under which the AMA consults other specified organisations and associations before advising the Minister on the appointment. (4) Before appointing a practitioner other than a medical practitioner to be a Panel member, the Minister must consult such organisations and associations, representing the interests of the profession to which the practitioner belongs, as the Minister thinks appropriate. 16 Section 85 deals with the appointments of Deputy Directors. Relevantly s 85(1) provides that the Minister may appoint Panel members to such a position. Director, the Minister must consult such organisations and associations, representing the interests of the profession to which the practitioner belongs, as the Minister thinks appropriate. 17 I should also refer to s 83. It provides: (1) The Minister may appoint a medical practitioner to be the Director of Professional Services Review. (2) The Minister must not appoint a person unless the AMA has agreed to the appointment. (3) The Director has such functions, duties and powers as are conferred on him or her by this Part or the regulations. 18 Most of the facts are uncontentious. Both parties rely on an affidavit of Dr Alan John Holmes filed by the Minister and sworn on 18 January 2003. The following summary is derived from it. 19 The appointments process began before the amending legislation commenced. Relevantly, on 9 March 1994 the then Health Minister, Senator Graham Richardson, wrote to the AMA. The Minister noted the obligation in s 84(3) to make an arrangement with the AMA under which the AMA consults other specified organisations and associations before advising the Minister on such appointments. The Minister asked the AMA to initiate consultations with appropriate organisations with a view to advising him as to suitable members who would be willing to be appointed to the Panel. He also specified three Colleges that had to be consulted. They were the Royal Australasian College of Physicians ("RACP"), the Royal Australian College of Surgeons ("RACS") and the Royal Australian College of General Practitioners ("RACGP") ("the specified Colleges"). It is not in dispute that by this letter the Minister discharged the obligation imposed by s 84(3) to make the appropriate arrangement. 20 Dr Holmes, a retired medical practitioner, was the first Director of the Scheme. During the time he served as Director, Dr Holmes undertook, on the Minister's behalf, all the consultations with the AMA as well as "furthering the arrangements with the AMA" under which the AMA consulted with other organisations and associations. Dr Holmes had close ties with the AMA. He was a longstanding member, had previously served the organisation in various capacities and was elected a fellow in 1986. He was also a fellow of the RACGP. 21 The first Panel members were appointed on 25 January 1995. Appointments were generally made for five-year terms expiring on 24 January of the relevant year. 22 Rightly or wrongly, Dr Holmes's position was that the existing Panel members should be reappointed if they were agreeable to being reappointed and after consultation with the AMA and by the AMA with the specified Colleges. 23 Accordingly, on 31 August 2004 Dr Holmes wrote to the AMA on the Minister's behalf. The letter was addressed to Dr Robyn Mason, its then Secretary-General. Omitting formal parts it read as follows: The current appointments for the members of the Panel end on 24 January 2005. I have sought advice from the current members as to their interest in being considered for reappointment. As some have been members for 10 years it is not surprising that some wish to cease their involvement. I attach a listing of those members of the Panel who would be interested in continuing along with their CVs. As you are aware it is a requirement (s84.3) of the Health Insurance Act 1973 that the Minister must consult with the Australian Medical Association (AMA) before appointing a medical practitioner to the Panel (copy of relevant section attached). The Act also required that the Minister must make an arrangement with the AMA under which the AMA consults other specified organisations and associations before advising the Minister on the appointment. Currently the Minister and the AMA have arrangements with respect to consultation with the Royal Australian College of General Practitioners regarding general practitioners, the Royal Australasian College of Surgeons regarding surgeons and the Royal Australasian College of Physicians regarding physicians. I have listed the members who have responded expressing their interests in remaining on the Panel by their State of residence and their professional designation. Prior to the previous appointment or re appointment, all current members of the Panel have only been appointed by the Minister subsequent to such consultations. Therefore on behalf of the Minister, I seek the advice of the AMA and relevant Colleges on a proposed reappointment of these medical practitioners listed. 24 Although there is no direct evidence of this, it seems (and Dr Lee apparently accepts) that there was a list attached to the letter. 25 Subsequently, Dr Mason wrote to the specified Colleges amongst others on behalf of the AMA, in each case attaching Dr Holmes's letter, seeking the College's "support or otherwise" for reappointments to the Panel, advising it of the statutory requirements for consultation, referring to the attached letter seeking advice, and inviting a response . 26 On 11 October 2004 Dr Mason wrote to the Chief Executive Officers of the Royal College of Pathologists of Australasia ("RCPA"), the RACGP, the RACS, the RACP, the Royal Australian and New Zealand College of Radiologists and the Royal Australian and New Zealand College of Obstetricians and Gynaecologists. 27 On 28 October 2004 the RACS replied to Dr Mason, endorsing the list of surgeons proposed for reappointment. On 16 November 2004 Dr Mason reported to Dr Holmes that the AMA had consulted with the RACS and of the outcome of the consultation, advising that the AMA endorsed the reappointment of the surgeons listed in the 31 August letter. 28 On 12 November 2004 the College of Radiologists wrote to Dr Mason to support the reappointment of the one radiologist who had been proposed. On 26 November 2004 Dr Mason reported to Dr Holmes that the AMA had consulted with the College of Radiologists of the outcome of the consultation and of the AMA's endorsement of the reappointment of the radiologists listed in the 31 August letter. 29 On 18 November 2004 the RCPA wrote to the AMA supporting the reappointment of the two pathologists on Dr Holmes's list. Eight days later, on 26 November, Dr Mason wrote to Dr Holmes advising that the AMA had consulted with the RCPA, of the outcome of the consultation and of the fact that it endorsed the reappointment of the pathologists listed in the 31 August letter. 30 It was some time before the RACGP replied to Dr Mason's letter but on 17 January 2005 it advised the AMA that it supported the names provided "in" the AMA's 11 October letter. The College of Obstetricians and Gynaecologists sent a similar letter to the AMA on 19 January 2005. 31 The AMA did not write to Dr Holmes to inform him of the outcome of these consultations or of its own view about the proposed appointments until 2 February 2005. By this time, however, Dr Holmes had already written to the then Health Minister, the Hon Tony Abbott MP, recommending the reappointments of all Panel members and the Minister had acted on that recommendation. In the minute to the Minister dated 15 December 2005 Dr Holmes referred to the requirement for consultation with the AMA and for the AMA in turn to consult with specified organisations before advising on the appointments. He noted, amongst other things, that five Colleges had been consulted (wrongly referring to the Royal Australian and New Zealand College of Ophthalmologists instead of the Royal Australian and New Zealand College of Obstetricians and Gynaecologists and omitting the RACP, one of the specified organisations). Dr Holmes then went on to state: The AMA advise they have contacted the specified organisations, but have only received responses from RACS and RCPA. However, this is sufficient to comply with the requirements of the Act in that you have consulted the AMA. The appointments of medical practitioners are those nominated in attachment A. 32 I interpolate that the first sentence of this paragraph is not accurate either. By the date of the minute the AMA had advised that it had received responses not merely from the RACS and the RCPA but also the College of Radiologists. 33 The minute went on to deal with non-medical Panel appointments, once again noting the requirement for consultation, listing the organisations and associations consulted on the Minister's behalf and informing the Minister that each of them supported the appointments of the practitioners proposed for appointment. 34 It concluded with a recommendation that the Minister sign the attached instrument for appointment. 35 In contrast to the position taken with respect to the non-medical appointments, the minute inexplicably did not inform the Minister of the AMA's advice in relation to any of the appointments the subject of the consultations referred to in [32] above. Nevertheless, on 24 January 2005 the Minister approved the (re)appointments of the Panel members including 28 NSW GPs. Amongst their number were Dr Napier and the other members of PSRC No 525, the Committee that made adverse recommendations about Dr Lee. 36 On 24 January 2006 the then Director of Professional Services Review, Dr Anthony Webber, recommended that Dr Napier and another GP, Dr Leon Shapero, be appointed Deputy Directors. The minute to the Minister again reminded the Minister of the requirement for consultation with the AMA and for the AMA in turn to consult with specified organisations before advising on the appointments. The minute went on to inform the Minister of the AMA's advice: The relevant organisation in relation to these proposed appointments is the Royal Australian College of General Practitioners. The AMA advises it has contacted the appropriate College and there are no objections to the appointments. 37 The same day the Minister made the appointments, with effect from 25 January 2006. 38 In substance, Dr Lee's case is that with respect to the GP appointments to the Panel (and more particularly the appointments of the doctors comprising PSRC No 525), the consultation intended by s 84(3) did not take place for any one of a number of reasons: because the AMA did not reply to the Director's letter before the Minister made the appointments; because the time allowed for consultation was inadequate; or because the consultation had not concluded at the time of the appointments. 39 The Commonwealth contends that as a matter of statutory construction, the consultation required of the Minister by s 84(3) is effected by giving the AMA a proper opportunity to respond and that, provided this is done, the Minister need not wait for a response before making the appointments. Alternatively, the Minister relies on the presumption of regularity and contends that Dr Lee has not shown that the AMA did not respond before 24 January 2005 when the Minister signed the instrument of appointments.

[18]

What does "consult" mean in s 84(3)? 40 This is a simple question which at first blush might be thought to generate an obvious answer. But there are respectable arguments in favour of each of the competing interpretations. Which is to prevail? 41 It is trite to observe that the task of statutory construction begins with the text itself, which may require consideration of the context, including the general purpose and policy of the provision and the mischief it seeks to remedy: Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (2009) 239 CLR 27 at 46 [47]. A construction that would promote that purpose or object must be preferred over one that would not: Acts Interpretation Act 1901 (Cth), s 15AA. 42 Section 84(3) does not expressly require that the Minister refrain from making an appointment until he or she has the AMA's response. It requires only two things of the Minister: that (s)he consult with the AMA and that (s)he make an arrangement with it under which it consults with other specified organisations and associations. 43 This of course begs the question of what is meant by "consult". Dr Lee relied first on the dictionary definitions. They are only of limited assistance, since they support both arguments. The Oxford English Dictionary, 2nd online edition, defines "consult" as: 1. [with obj.] seek information or advice from (someone, especially an expert or professional): if you consult a solicitor, making a will is a simple procedure. 2. have discussions with (someone), typically before undertaking a course of action: patients are entitled to be consulted about their treatment [no obj.] the government must consult with interested bodies. 3. refer for information to (a book, diary or watch). 44 The Macquarie Dictionary defines "consult" as: 1. to seek counsel from; ask advice of. 2. to refer to for information. 3. to have regard for (a person's interest, convenience, etc.) in making plans. 4. (sometimes followed by with) to consider or deliberate; take counsel; confer. 45 The Commonwealth relied on the interpretation of "consult" or "consultation" in a string of cases: Rollo v Minister of Town and Country Planning [1948] 1 All ER 13 ("Rollo"); Port Louis Corporation v Attorney-General of Mauritius [1965] AC 1111 ("Port Louis"); TVW Enterprises Ltd v Duffy (No 2) (1985) 7 FCR 172; Leichhardt Municipal Council v Minister for Planning (1992) 78 LGERA 306 ("Leichhardt MC"); Darling Casino Ltd v Minister for Planning & Sydney Harbour Casino Pty Ltd (1995) 86 LGERA 186; Bond v WorkCover Corporation of South Australia and Allianz Australia Workers' Compensation (SA) Ltd (2005) 93 SASR 315; and Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v QR Ltd (2010) 198 IR 382 ("CEPU v QR"). 46 Each of these cases supports the construction for which the Commonwealth contends or, at least, is consistent with it. The Commonwealth draws attention to the observation of Sheller JA in Leichhardt MC at 338 that "the parliament must be taken to have chosen the word 'consultation' conscious of its use historically in this type of legislation". 47 The Commonwealth does not suggest that it is enough that the Minister simply go through the motions. It is well established that "the requirement for consultation is never to be treated perfunctorily or as a mere formality" (Port Louis at 1124). The Commonwealth submitted, however, that the requirement for consultation in s 84(3) was satisfied if the Minister supplied sufficient information to the AMA to enable it to provide advice and a sufficient opportunity to proffer advice (cf. Rollo at 17 per Bucknill LJ, Port Louis at 1133 - 1134). The Commonwealth contented that the provision falls short of requiring that the Minister wait until he receives the advice before making an appointment. If the AMA, through choice or neglect, failed to take advantage of that opportunity, then so be it. 48 The Commonwealth's argument was eloquently put and it has some attractions, but ultimately I have concluded that it must be rejected. The difficulty is that it pays insufficient attention to the legislative purpose as explained in Kutlu (to which I shall come shortly) and to the words of the statute in that they gloss over the presence in s 84(3) of the clause "before advising the Minister on the appointment". None of the authorities to which it referred considered a provision which contained a comparable clause. I would respectfully adopt what the Judicial Committee of the Privy Council said in Port Louis at 1124 when their Lordships were taken to some authorities on the meaning of consultation (including Rollo): Helpful as the citations were, the nature and the object of consultation must be related to the circumstances which call for it. 49 Similarly, as Logan J explained in CEPU v QR at 395 [44], "what will amount to 'consultation' has about it an inherent flexibility". 50 The Commonwealth quite rightly insisted that the section should not be read in isolation. It contrasted s 84(3) with s 23DZC where the Minister's power to revoke a "remote area exception" is enlivened only after, amongst other things, a Medicare Participation Review Committee has provided certain advice to the Minister. This section appears in Pt IIB, not Pt VAA, and whilst the Act should obviously be read as a whole, I do not think that the wording of s 23DZC assists in deciding what is meant by "consult" in Pt VAA. 51 For all these reasons it seems to me that the question of construction is to be resolved by looking at the context and purpose of the legislative scheme introduced by Pt VAA. This was an issue considered at length in Kutlu. 52 Dr Lee relies on Kutlu, in particular on several passages in the joint judgment. Dr Lee did not contend that the remarks in the joint judgment in Kutlu were binding on the Court in this case. He submitted, however, that they were right. He emphasised the importance of the AMA's role in the scheme, a role described by Flick J in Kutlu at [81] as "pivotal". 53 In Kutlu Rares J and I held at [18]-[20]: [18] [Sections] 84(3) and 85(3) contemplate that, after consultation with and advice from the AMA about them, the Minister can appoint persons, whose appointment the AMA did not support or opposed… [19] It is implicit in ss 84(3) and 85(3) that the Minister must have regard to the consultation with, and advice of, the AMA in exercising the power to make an appointment. That is to say, the advice of the AMA is a relevant, though not decisive, consideration for the Minister in arriving at a decision to make an appointment… [20] The appointment process contemplated in ss 84 and 85 is intended not only to ensure public confidence in the decisions reached after involvement of Committees, but also to ensure the confidence of the relevant professions, as well as the professional whose conduct is being reviewed. In the case of medical practitioners, that process was intended by the Parliament to be one for which the persons carrying out the review had been selected only after the Minister had received advice from the AMA and, through it, any other relevant professional organisation or association about a proposed appointee. (Emphasis added.) 54 We said (at [28]) that the Parliament used the words "must consult" and "before advising" to achieve this purpose. We stressed (in [27]) that both consultation with and advice by the AMA on appointments are preconditions to the exercise of the appointment power in both ss 84(3) and 85(3). 55 Later (at [33]) when summarising the requirements of the sections, we explained that they confer a discretion on the Minister to appoint "after the preconditions of consultation with, and advice by, the AMA have been fulfilled and the Minister has had regard to that advice". Further, (at [36]) we said that the Minister was bound to take the AMA's advice into consideration when making an appointment under the two subsections and a failure to do so would be a jurisdictional error. In other words the AMA's advice was a relevant consideration in the Peko-Wallsend sense (see Minister for Aboriginal Affairs v Peko-Wallsend Limited (1986) 162 CLR 24 at 39). 56 True it is, as the Commonwealth submitted, these remarks need to be seen in context. Kutlu was not concerned with the meaning of "consult". As I have already observed, it was an agreed fact in those proceedings that the Minister did not consult. Consequently, the Court did not have the benefit of argument on the point. Our remarks were made on the basis of an assumption that consultation would include the provision of advice. We did not consider the possibility that the AMA would not offer any advice. It was unnecessary to do so. The issue in Kutlu was the legal effect of the failure to consult. A proposition of law incorporated into the reasoning of an appellate court is not binding on later courts if the court merely assumed its correctness without argument - even if it forms part of the ratio decidendi: CSR Ltd v Eddy (2005) 226 CLR 1 at [13]. 57 In Kutlu, however, the Court did hear argument about the purpose of s 84(3). Its decision on that question is binding. 58 Regardless of whether I am bound by Kutlu, I do not find the Commonwealth's argument compelling. In my opinion Parliament intended that the Minister could only make the appointments after he had received advice from the AMA. The whole purpose of the consultation, after all, was to obtain the AMA's advice. Despite what he said in his minute to the Minister, Dr Holmes appears to have understood this at the time he told the AMA in his 31 August letter that he was "seeking" (on the Minister's behalf) its advice; not merely giving it a chance to advise. Either that, or he was misleading the AMA. 59 The Commonwealth argued that Parliament could not have intended this outcome. It pointed out that the Minister does not control the AMA, the Colleges or any of the other organisations referred to in ss 84 and 85. It variously submitted that if Dr Lee's position was right, then each of those organisations could "hijack", "stultify" or "frustrate" the process or "hold it to ransom" by simply declining to respond. It further submitted that in the case of non-medical appointees, the effect of Dr Lee's position is that having regard to s 84(4), "a wholly unidentified group over which Parliament has no control and over which Parliament gives the Minister no control" could also hijack the process and this could obviously not have been intended. 60 I reject this submission. First, it ignores s 83 which, it will be recalled, only allows the Minister to appoint the Director if the AMA agrees. Secondly, the feared outcome could easily be avoided by the Minister informing the AMA that if it does not respond, the Minister will take the response to denote agreement. Thirdly, given the AMA's role in the establishment of the scheme and its interest in its success, I think it most unlikely that the AMA would choose not to respond. If it fails to respond, it is an easy thing to chase up a response. As for the position with the non-medical appointees, it is by no means certain that s 84(4) should be interpreted in the same way as s 84(3). For one thing, it does not refer to the organisations or associations advising the Minister. For another, the AMA is accorded special status in the legislative scheme. 61 Sections 84(3) and 85(3) expressly contemplate that the AMA will advise the Minister. The function of the consultation is not simply to notify the AMA of the Minister's intentions. Rather, Parliament intended that all decisions on appointments to Panels (and to the position of Deputy Director) be informed, though not dictated, by the advice of the AMA and through it the specified organisations and associations. Those decisions could not therefore be made without knowing how the AMA stood on the prospective appointments. In my view, the construction of s 84(3) that Dr Lee advances would better promote the purpose of the legislation than that for which the Commonwealth contends. 62 There are sound reasons why Parliament is likely to have intended that appointments be informed by the advice of the AMA and the professional organisations. Unbeknown to the Minister but well known to the AMA and his or her College, a person in consideration for appointment or re-appointment might recently have lost his or her specialist accreditation or have been suspended from practice. A doctor may have become infirm or erratic in ways that are not well known but which are discernible by his or her colleagues. The Minister would plainly want to know whether one of his or her proposed appointees is unsuitable for the position. I do not think that Parliament would have intended that the Minister could make an appointment without knowing what the AMA thought of them. The Act provides for a system of peer review, the success of which depends on its acceptance within the medical community. 63 In his second reading speech on the amendment bill that introduced Pt VAA, the Parliamentary Secretary to the Minister for Health explained that the amendments reflected "the outcome of a close consultative process with the [AMA]". The Parliamentary Secretary emphasised the "key role" the organisation had played in the development of the scheme "and in so doing has demonstrated that it takes seriously its expressed belief that it has a duty to cooperate in ensuring that the public resources earmarked for health care are appropriately utilised". It is clear that the cooperation of the AMA was seen as essential to the success of the scheme. 64 Subject to the Commonwealth's second contention, then, I am not satisfied that the Minister consulted the AMA as s 84(3) required before the GP appointments were made. 65 There is another thing. In the present case the Commonwealth accepted that, had the AMA given advice to the Minister on the appointments, the Minister would have been bound to take that advice into account. Of course, the AMA did give the Minister advice but the advice was received after the appointments were made. Although the 31 August letter informed the AMA that the current appointments would end on 24 January 2005, it did not inform the AMA that the decision on reappointments would be made before that date. Nothing in the AMA's correspondence indicates any appreciation of the fact that their advice was required by a particular time. The AMA had evinced an intention to respond to Dr Holmes's request for advice. It wrote back to him each time it had received a reply from a College to convey its advice and to pass on the advice of the College. By the time the minute was prepared, Dr Holmes had received three letters from the AMA informing him of its advice with respect to the proposed reappointments of those Panel members who were surgeons, pathologists and radiologists, and of the attitude of their Colleges. In her letter to Dr Holmes of 16 November 2004 Dr Mason said that she was aware that there were several outstanding replies from the Colleges to his request for "endorsement or otherwise" and she told him she would follow up the Colleges in the near future. Dr Holmes (and therefore the Minister) could reasonably have expected a response from the AMA about its position and the position of the Colleges on the remaining appointments. Until such a response was forthcoming, whether oral or in writing, consultation had not concluded. In the case of the GPs at least, the Minister's decision to approve Dr Holmes's recommendation and to make the appointments was premature. 66 Consultation under s 84(3) (and 85(3)) is a process. The first step is that the Minister consults the AMA. The second is that the AMA consults the appropriate Colleges. The third is that the AMA advises the Minister, unless the communications between them are such that the Minister may reasonably infer what that advice is. Only then may the Minister make the appointments. 67 Dr Holmes's assurance to the Minister to the effect that the legislative requirements had been met, though the outcome of the consultation was in some instances unknown, was mistaken.

[19]

Does the presumption of regularity save the day? Has Dr Lee displaced it? 68 I now turn to the Commonwealth's second contention. 69 In Minister for Natural Resources v Aboriginal Land Council (1987) 9 NSWLR 154 at 164 McHugh JA explained the presumption of regularity in a case of this kind in the following way: Where a public official or authority purports to exercise a power or to do an act in the course of his or its duties, a presumption arises that all conditions necessary to the exercise of that power or the doing of that act have been fulfilled. Thus a person who acts in a public office is presumed to have been validly appointed to that office. 70 In the present case the presumption would arise where there was no reason to think that the appointments were not valid. Here, however, it is doubtful whether there is any room for the operation of the presumption. In the alternative, I am satisfied that the presumption has been rebutted. 71 In Carpenter v Carpenter Grazing Co. Pty Ltd (1987) 5 ACLC 506 ("Carpenter") at 514 Hope JA, with whom Samuels and Priestley JJA agreed, said: the true rule is that the presumption may reasonably be drawn where an intention to do some formal act is established, when the evidence is consistent with that intention having been carried into effect in a proper way, the observance of the formality has not been proved or disproved and its actual observance can only be inferred as a matter of probability: Harris v Knight (1890) 15 PD 170 at 179-180; In the Estate of Bercovitz [1962] 1 WLR 321 at 327. 72 This is not a case (as Carpenter was) where there is no evidence about the observance of the formality. Here, there is evidence that the advice was given after the appointments were made and that before the advice was given the Director informed the Minister that advice was unnecessary. In the present case the observance of the formality has been disproved. 73 I accept the Commonwealth's submission that the effect of the presumption is that the onus is on Dr Lee to prove there was no response from the AMA before the appointments were made. I also accept the Commonwealth's submission that the presumption carries some weight. But the weight can vary according to the circumstances (Hill v Woollahra Municipal Council (2003) 127 LGERA 7 at [52] per Hodgson J). 74 Dr Lee relies on the letter from the AMA to Dr Holmes dated 2 February 2005. Thus, on the face of things, the advice was not received until after the appointments had been made. Dr Lee also issued various notices to produce seeking "all documents and files that evidence consultation of the Minister with the AMA that occurred before appointing [Drs Napier, An and McMahon] to be members of the [Panel and before they sat as members of PSRC No 525]" as well as all documents evidencing the AMA's advice to the Minister on those appointments. These notices and the documents produced in answer to them were annexed to an affidavit sworn by Dr Lee's solicitor, Andrew Davey, filed on 14 September 2012, which Dr Lee read in the proceeding. None of them contained any record of any advice from the AMA before the date of its letter. In these circumstances the Commonwealth has an evidential (or tactical) burden of showing otherwise: Apollo Shower Screens Pty Ltd v Building and Construction Industry Long Service Payments Corp (1985) 1 NSWLR 561 at 565, citing Purkess v Crittenden (1965) 114 CLR 164 at 167-168, 171. As the learned author of the most recent Australian edition of Cross on Evidence puts it: Where one party bears the burden of proving a negative but the other has greater means to produce evidence to contradict the negative proposition, then provided the party bearing the burden of proof has tendered some evidence from which the negative proposition may be inferred, the other party carries a tactical burden to advance in evidence any matters with which (if relevant) the first party would have to deal in the discharge of its legal burden of proof. See JD Heydon, Cross on Evidence (9th Australian edition, 2013) at [7165]. 75 The Commonwealth submits that the evidence leaves open the real possibility that the AMA responded in an informal way before 24 January 2005. That may be so, but it is not enough. The standard of proof is the civil standard of the preponderance of probabilities. Dr Lee does not have to prove beyond reasonable doubt that there was no informal response. The Commonwealth points to the 31 August letter from Dr Holmes to the AMA and in particular its reference to the date the appointments expired. It submits that the 11 October letter from the AMA to the RACGP and the RACGP's reply of 17 January 2005 (a week before the appointments) show that the AMA was well aware of that support before the appointments were made. "So what?" one might ask. None of the correspondence so much as hints that the AMA provided advice to the Minister before he announced the appointments. The Commonwealth drew attention to the fact that the RACGP letter spoke of "confirmation" of its support for the appointments. This does not take the matter any further. Taken at its highest, the evidence could support an inference that the RACGP had communicated its views to the AMA before the College sent its letter to the Association; it does not give rise to an inference that the AMA had informed the Minister of its own views (or those of the RACGP) before it wrote the 2 February letter. 76 Of course it is true, as the Commonwealth submits, that the AMA could have communicated its views to the Minister before 24 January 2005. After all, it knew that the current appointments were due to expire on that date. Dr Holmes had told them so in his 31 August letter. But there is no evidence to suggest that it did. On the other hand, Dr Lee produced evidence to show that the advice was not forthcoming until after the appointments had been made. The letter sent by the AMA to the Minister on 2 February 2005 does not refer to any earlier advice, either expressly or implicitly. There is no sense of urgency in the AMA's correspondence with the Minister and nothing to suggest that it was conscious of the need to advise the Minister before the old appointments expired. 77 Furthermore, Dr Holmes, who was the AMA's point of contact with the Minister, did not say that the AMA had been in touch with him about the appointments before the 2 February letter. In Dr Holmes's minute to the Minister there is no reference to any informal indication of the AMA's position on the appointments. (Having said that, the minute does not mention the "formal" advice the AMA had provided about the surgical and other appointments either.) Nor is there any evidence of a file note of any conversation between a representative of the AMA and the Minister or someone on his behalf. Dr Holmes did say in his affidavit that he had strong links to the AMA and that he was in regular contact with the AMA. Critically, however, he did not say that in the course of that contact he was informed of the AMA's attitude to the appointments in question. Had there been such a conversation (whether with Dr Holmes, someone in his office or someone in the Minister's office), I would have expected the Commonwealth to call evidence about it or to explain why the evidence was unavailable: Blatch v Archer (1774) 1 Cowp 63; 98 ER 969. This it did not do. 78 In all these circumstances, I am satisfied that it is more probable than not that the AMA did not advise the Minister of its position before the appointments were made.

Lee v Napier

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Cases Cited (13)

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