The exercise of the discretion was Wednesbury unreasonable
43There is Wednesbury unreasonableness, from Associated Provincial Picture Houses Ltd v Wednesbury Corporation ( 1948) 1 KB 223, where the exercise of a discretion is so unreasonable that no reasonable person could have so exercised it. It has long been accepted as a ground for judicial review of administrative action.
44Lord Greene MR's formulation of unreasonableness has been criticised for circularity and vagueness (see for example Fares Rural Meat and Livestock Co Pty Ltd v Australian Meat and Live-stock Corporation (1990) 96 ALR 153 at 166 per Gummow J, and the reference by Crennan and Bell JJ in Minister for Immigration and Citizenship v SZMDS [2010] HCA 16, (2010) 240 CLR 611 at [129] to "dissatisfaction with the inherent circularity of the Wednesbury test"). The language was nonetheless taken up in statutory provisions, notably in s 5(2)(g) of the Administrative Decisions (Judicial Review) Act 1977 (C'th).
45In Associated Provincial Picture Houses Ltd v Wednesbury Corporation at 227 Lord Greene distinguished between what a court may consider unreasonable and "something quite overwhelming". His Lordship's formulation has been explained with varying degrees of stringency, but in judicial review of administrative action a quite demanding level of unreasonableness has been required. This reflects, amongst other things, the separation between the exercise of executive and judicial power which, at Federal level, has constitutional dimensions. Thus in Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1976) 162 CLR 24 at 42, where the asserted ground of unreasonableness was giving too much or too little weight to one consideration or another, Mason J cautioned lest a court "exceed its supervisory role by reviewing the decision on its merits".
46It has been said that describing reasoning as unreasonable, even using Lord Greene's formulation, may be no more than an emphatic way of disagreeing with it, see for example Minister for Immigration and Multicultural Affairs v Eshetu [1999] HCA 21; (1999) 197 CLR 611 at [40] per Gleeson CJ and McHugh J; re Minister for Immigration and Multicultural Affairs; ex parte Applicant S20/2002 [2003] HCA 30; (2003) 198 ALR 59 at [5] per Gleeson CJ; Minister for Immigration and Citizenship v SZJSS [2010] HCA 48; (2010) 273 ALR 122 at [34] per French CJ and Gummow, Hayne, Heydon, Crennan, Kiefel and Bell JJ. The same may be said of describing the exercise of a discretion as unreasonable. In Attorney-General of New South Wales v Quin (1990) 170 CLR 1 at 36 Brennan J said that Wednesbury unreasonableness "leaves the merits of a decision or action unaffected unless the decision or action is such as to amount to an abuse of power", and that this basis for judicial review "is extremely confined". However, as was pointed out by Brennan J in Kruger v The Commonwealth (1997) 190 CLR 1 at 36, where a discretionary power is statutorily conferred the legislature must be taken to have intended that it be exercised reasonably; see also Abebe v The Commonwealth [1999] HCA 14; (1999) 197 CLR 510 at [116] per Gaudron J and Minister for Immigration and Citizenship v SZMDS at [123] per Crennan and Bell JJ.
47The courts by their supervisory role keep the administrative decision-maker within its legislative authority. The Appeal Panel's discretion rests on its statutory function, and if the exercise of the discretion was so unreasonable that, beyond the court's strong disagreement, no reasonable person could have so exercised it, relief should be granted.
48The scene was set when the Appeal Panel determined that a further medical examination was not necessary. If the Appeal Panel had itself conducted a further medical examination, no doubt that would have included taking a history from the applicant and hearing first hand his account of his symptoms and of the past and present psychiatric or psychological consequences of the work injury. The Appeal Panel could assess for itself the veracity, reliability and significance to finding a degree of whole person impairment of the history they took, having regard to the medical evidence and bypassing the issue of the AMS's alleged failure to take an adequate or accurate history and to record the history given during his examination of the applicant. But they did not take that course.
49The Appeal Panel said that they had "conducted a review of the material before [them] and reached [their] own conclusion concerning the correct assessment of the impairments and losses suffered by the Respondent". The material before them included the AMS's medical assessment certificate, and it is evident that they focussed on it and, as the first respondent accepted in submissions, had regard to the history recorded by the AMS.
50The Appeal Panel came to their conclusion by addressing and rejecting the applicant's grounds of appeal, relevantly the grounds of appeal founded on the AMS's alleged failure to take an adequate or accurate history and to record the history given during his examination of the applicant. They rejected the ground of appeal of failure to take an adequate or accurate history (para 31), and rejected the ground of appeal of failure to record the history given during the examination (para 39). They did the same as to the PIRS classes: the Appeal Panel considered that the AMS's reasons "justify the primary assessment and are sufficient and accurately based on the history given to the AMS" (para 42). That left intact the AMS's diagnosis (para 31), his diagnosis and assessment (para 39), and "the PIRS Category as assessed by the AMS for the reasons given by the AMS" (para 42). Hence the AMS's medical assessment certificate was confirmed.
51Despite what the Appeal Panel said, this was not a case of an independent diagnosis and assessment, but one of rejecting challenges to the AMS's diagnosis and assessment and his consequential arrival at the degree of whole person impairment. In rejecting the challenges the Appeal Panel specifically found that the AMS "has taken an adequate and accurate history of the Appellant's injury and present condition to enable him to form the diagnosis he did" (para 31), and that the AMS "has taken a correct history as given to him during the examination and has recorded those aspects of the examination and the Appellant's response where relevant to the diagnosis and assessment" (para 38).
52The reasoning to these findings is in some respects not entirely clear. For example, that the AMS had "taken a history sufficient to allow him to assess the appellant in relation to [the PIRS] classification system" and appeared to have read medical reports which recorded the history and symptoms of which the applicant complained (para 30) says nothing of whether the AMS had recorded an accurate history at the time of the AMS's medical examination. Reference to the AMS apparently being "alerted to the issue" of nightmares and flashbacks (para 35), and to seeing "evidence of the accuracy of the interview and examination" in his apparent awareness of the issue of suicidal thoughts (para 37), do not seem to bear upon the alleged failure to record the history given by the applicant. The Appeal Panel seem also to have reasoned that the applicant can not have complained of nightmares to the AMS because Dr Clark had recorded that he said that he did not sleep long enough to have nightmares (para 36), which does not follow where Dr Clark's report was in 2007. These examples are not exhaustive.
53These examples, however, would go to merits review of the substantive appeal. The question is not whether the Appeal Panel was correct in determining, to the extent that they did, that as a matter of fact the AMS had not failed to ask the applicant about the matters which the applicant said he had not been asked about, and more particularly had not failed to record matters or had incorrectly recorded matters which the applicant had said to him, as alleged in the applicant's statement. The point for present purposes is that they did so having refused to receive into evidence the applicant's statement on which his complaints in these respects depended. They made positive findings that the AMS had taken an adequate and accurate, or correct, history and had recorded relevant "aspects" correctly, and had regard to the history recorded by the AMS notwithstanding that it was under challenge. The Appeal Panel's rejection of the ground of failure to apply the correct PIRS classes was founded on their acceptance that the AMS had accurately recorded the history given at the medical examination.
54Making the positive findings, and thereby rejecting the challenges to the AMS's medical assessment certificate and leaving it intact, was the Appeal Panel's essential reasoning. They need not have taken that path to confirmation of the AMS's medical assessment certificate. Having refused to receive the appellant's statement into evidence, they could have taken the AMS's medical assessment certificate at face value because there was no evidence to impugn "the process of the medical examination", and come to their own conclusion on the medical evidence alone or on the medical evidence plus the AMS's medical assessment certificate. The path they took, however, involved determining the very issues to which the evidence they refused to received was directed, notwithstanding that without the evidence the applicant had nothing on which he could rely for his complaints concerning the AMS's medical examination and its recording.
55The refusal to receive the applicant's statement must be considered in this context. For convenience, I repeat para 12 of the Appeal Panel's reasons -
"The Panel has determined that the 'fresh evidence' should not be received in the Appeal because the Appellant comments on the process of the medical examination and there is an interest in finality of litigation which admitting the statement would not serve. For reasons of procedural fairness, the Panel could not consider the allegations made by the Appellant in the absence of a response from the AMS. That continual opening and re-opening of the evidence is not in the interests of justice and not contemplated as part of the appeal mechanism in the Commission."
56The Appeal Panel did not exercise their discretion for any reason to do with apparent credibility or capacity to affect the result.
57That the applicant commented on the process of the medical examination was not of itself a reason for refusing to receive his statement. That was why the applicant's statement was relevant and was not excluded by s 328(3).
58The perhaps obscurely expressed reasons should be read benevolently ( Minister for Immigration and Ethnic Affairs v Wu Shan Liang (1996) 185 CLR 259 at [271]-[272]). As I understand the Appeal Panel, if the comments on the process of the medical examination were received, procedural fairness would require that the first respondent have the opportunity to reply to the evidence, and receiving the two rounds of new evidence would be contrary to the need for finality in litigation. The need for finality in litigation was further expressed in the observation that "continual opening and re-opening of the evidence is not in the interests of justice and not contemplated as part of the appeal mechanism in the Commission".
59There was here no question of continual opening and re-opening of the evidence, or of exceeding what was "contemplated as part of the appeal mechanism in the Commission". Putting aside the hyperbole, so far as the applicant commented on the process of the medical examination, the question was one of receiving evidence which fell within s 328(3). Reception of such evidence, and of evidence replying to it is clearly part of the "appeal mechanism". It was said in Siddik v WorkCover Authority of NSW at [100] that an appeal by way of review under s 328 may involve a hearing de novo . The operation of the "appeal mechanism" extends that far, beyond the reception of fresh or additional evidence.
60Finality of litigation had no command against reception of the applicant's statement so far as he complained of what had occurred at and in the recording of the AMS's medical examination. The evidence could not have been brought forward at any earlier time. The Appeal Panel had determined, whether independently of deciding that the applicant's statement would not be received or together with that decision does not matter, not to have a further medical examination. It took the course of addressing and resolving the applicant's grounds of appeal by the essential reasoning earlier described. The evidence went fundamentally to the AMS's arrival at his assessment of whole person impairment and to the grounds of appeal, and refusal to receive it would emasculate the appeal because the Appeal Panel would decide the grounds of appeal dependent on the evidence without the evidence. There was no case against reception of the applicant's statement. The first respondent did not assert hardship or any like consideration against its reception, and it could not be suggested that the circumstances of the first respondent or its insurer called for finality by holding the applicant to the AMS's assessment of whole person impairment despite his complaints.
61On one view, the applicant was denied procedural fairness because the Appeal Panel refused to receive his statement for the reasons in para 12 when the first respondent's opposition had been because the applicant had had the opportunity to put his symptoms to the AMS. That basis for opposition hardly answered the complaint of what had occurred in and in the recording of the AMS's medical examination, and the Appeal Panel gave no notice of refusal to receive the applicant's statement for their quite different reasons. This was not raised as a ground of judicial review, and I put it aside.
62With respect to the Appeal Panel, in my opinion their decision to refuse to receive the applicant's statement for the reasons they gave was one to which no Appeal Panel, acting reasonably, could come.
63In principle, the Appeal Panel could have been influenced to refuse to receive the applicant's statement in the exercise of their discretion because they did not consider it credible, or did not think the evidence would alter the result. The findings that the AMS "has taken an adequate and accurate history of the Appellant's injury and present condition to enable him to form the diagnosis he did" (para 31), and that the AMS "has taken a correct history given to him during the examination and has recorded those aspects of the examination and the Appellant's response where relevant to the diagnosis and assessment" (para 38) could suggest that the Appeal Panel came to one or a combination of these views, although as I have said the reasoning is not entirely clear. Assuming they did that albeit having already refused to receive the applicant's statement, and that it was open to them to come to the view as to credibility and/or effect on the result, does that have any consequences for Wednesbury unreasonableness of their decision to refuse to receive the applicant's statement?
64I do not think that it does. Judicial review is essentially concerned with holding the administrative decision-maker to acting according to law, within its authority, and with due process. The boundaries of jurisdictional error are notoriously difficult, but as a general proposition the merits of the decision are not for the court, including that "[i]t is not the function of the court to substitute its own decision for that of the administrator by exercising a discretion which the legislature has vested in the administrator" ( Minister for Aboriginal Affairs v Peko-Wallsend Ltd at 40 per Mason J). To reason that, although the Appeal Panel's refusal to receive the applicant's statement for the reasons they gave was Wednesbury unreasonable, it would have been open to the Appeal Panel reasonably to have refused to receive the applicant's statement for other reasons, would be to make on the merits a decision the Appeal Panel did not make, rather than test the decision they did make against Wednesbury unreasonableness. It is different where Lord Greene's formulation for Wednesbury unreasonableness in public law is taken up as an objective test in the private law of reasonable response to foreseeable risk of injury, as in s 43A of the Civil Liability Act 2002, see for example Allianz Australia Insurance Ltd v Roads and Traffic Authority of New South Wales [2010] NSWCA 328; (2010) 57 MVR 80 in particular at [88]-[89]. For judicial review, the focus is on the decision-maker's decision; cf The King v Connell; ex parte The Hetton Bellbird Collieries Ltd (1944) 69 CLR 407 at 432 per Latham CJ, in the context of exercise of a power if a particular opinion is formed referring to the basis of the exercise of the power being absent if the opinion "was arbitrary, capricious, irrational or not bona fide"; Minister for Immigration and Citizenship v SZMDS at [23]-[24] per Gummow ACJ and Kiefel J; [122], [129] per Crennan and Bell JJ.
65Refusal to receive the applicant's statement was an interlocutory decision, by the reference to a preliminary review one made separately from the Appeal Panel's further consideration of the appeal. It is not clear whether at the time of the preliminary review the Appeal Panel had embarked upon, or foresaw, their course of making positive findings that the AMS had taken an adequate and accurate, or correct, history, and rejecting the applicant's grounds of appeal, whereby the AMS's diagnosis and assessment and PIRS scales were left intact. If not, when the Appeal Panel prepared their reasons of 13 May 2009 the manifest unreasonableness of refusing to receive the applicant's statement for the reasons they gave was exposed. The refusal should have been reconsidered, or the Appeal Panel could have determined to conduct its own medical examination and bypass the applicant's complaints as to the AMS's medical examination.