Riverside Nursing Care Pty Ltd v Honourable Bronwyn Bishop FCA - [2000] FCA 434 - FCA 2000 case summary — Zoe

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Riverside Nursing Care Pty Ltd v Honourable Bronwyn Bishop FCA

[2000] FCA 434

Federal Court of Australia|2000-04-07|Before: Sundberg J

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Source facts

Court

Federal Court of Australia

Decision date

2000-04-07

Before

Sundberg J

Source

Original judgment source is linked above.

Judgment (76 paragraphs)

[1]

REASONS FOR JUDGMENT INTRODUCTION 1 Until 5 March 2000 the applicant was an approved provider of aged care services at the residential aged care service known as Riverside Nursing Home ("the Home"). On that day the second respondent ("the Secretary") revoked the applicant's approval as a provider and its allocation of places. The Secretary had earlier, on 22 February, revoked the approval and allocation, but had suspended the operation of the revocation. The Secretary's decisions were made under s 65 of the Aged Care Act 1997 ("the Act"). The applicant has sought review of the decisions under the Administrative Decisions (Judicial Review) Act 1977 ("the ADJR Act"). Where it is necessary to distinguish between the two decisions I will call the February decision "the first decision" and the March decision "the second decision". I have before me two notices of motion. The first is the applicant's motion for an order under s 15(1)(a) of the ADJR Act that until the hearing and determination of the principal Application the operation of the decisions be suspended. The second motion is the respondents' motion for an order pursuant to Order 54 rule 7 of the Rules that the principal Application be dismissed. I will deal with the second motion first, because if the respondents succeed on that motion, it will not be necessary to deal with the applicant's motion. PROVISION OF OTHER ADEQUATE REVIEW 2 The basis for the respondent's motion lies in s 10(2)(b)(ii) of the ADJR Act, which empowers the Court, in its discretion, to refuse relief in respect of a decision for the reason

[2]

[53]

14 The structure of s 67 and the Principles themselves disclose that par 3.7 does not purport to fetter the Secretary's ability under s 67‑1(2) to deal with an emergency situation without the need to comply with the requirements of par 3.7. The principles governing the imposition of sanctions following a review audit report are different from those involved when the accreditation body uncovers what it believes to be evidence of serious risk to care recipients. The review audit report must include recommendations about necessary improvements and about further support contacts with the service, information about the arrangements for support contacts, and proposals for a timetable for making the necessary improvements: see pars 3.6 and 3.7 of the Principles. The approved provider then has fourteen days to provide the accreditation body with a written response, which must be considered by the accreditation body. If changes are to be made to the list of necessary improvements or the timetable for improvements, the accreditation body must make them within fourteen days of receiving the provider's response, and publish a supplementary review audit report (par 3.7(3) and (4) of the Principles). Only if a timetable has been agreed, and at the end of the timetable the accreditation body is not satisfied that the appropriate level of care is being met, can the accreditation body recommend to the Secretary that sanctions be imposed: see par 3.8. If, however, during the review audit the accreditation body finds evidence of a serious risk to the care recipients, it must immediately inform the Secretary in writing. As soon as practicable it must provide the Secretary and the provider with a copy of a serious risk report, outlining the reason for the risk, the standards that have not been complied with, an appropriate improvement outline and recommendations about whether sanctions should be imposed: par 4.2 of the Principles. If the Secretary is satisfied that there is a serious risk to the care recipients, the Secretary may dispense with the usual procedure for imposing sanctions set out in s 67-1 of the Act, and impose sanctions immediately. 15 It is apparent from the above discussion that the consequences of a review audit report and of a serious risk report are quite different. A recommendation for sanctions following a review audit report occurs after a sequence of events that may last over a month. The provider is given the opportunity for input into the appropriate ways of redressing non‑compliance with standards, and a timetable for improvement is created. Sanctions that follow a serious risk report may be imposed immediately, and no provision is made under the Act or the Principles for a response by the provider. The applicant has not shown a point of substance or a serious question on this point.

[60]

Illawong 19 The applicant relied on an affidavit of one of its directors from which it appears that the Home is an integral part of a three phase retirement scheme which involves the operation of the nursing home in conjunction with adjoining retirement units and retirement apartments. The entire scheme is owned by Illawong. Illawong has experienced difficulty in selling interests in units and apartments because of the closure of the Home. Some occupants of units and apartments have said they will consider moving elsewhere if the Home is not reopened. The director expresses the view that "unless there can remain a possibility of the nursing home reopening in the near future a critical basis upon which the said retirement complex has been established will be destroyed and Illawong will suffer irreparable loss in the way of existing residents and loss of future sales to such an extent as to render the said business unviable and force it to close". 20 The question is whether the delegate was bound to take into account that the imposition of the sanctions might cause loss to a third party. The Act does not require the Secretary to take that type of consideration into account, and the subject matter, scope and purpose of the Act do not give rise to an implication that he should. Cf Minister for Aboriginal Affairs v Peko‑Wallsend Ltd (1986) 162 CLR 24 at 39‑40. Indeed those matters suggest the contrary. Section 67 is concerned, amongst other things, with non‑compliance with quality of care standards (Part 4.1). It is also concerned with cases where the safety health or wellbeing of care recipients are subject to immediate and severe risk. Given the Act's focus on the wellbeing of residents and the provider's related obligations to them, it is not in my view seriously arguable that an implication arises out of the subject‑matter, scope and purpose of the Act that the Secretary must take into account the possibility that third parties might suffer economic loss because of the imposition of sanctions on the provider. The applicant has not shown a point of substance or a serious question under this head.

[72]

OTHER MATTERS Balance of convenience 25 In view of my conclusion that the applicant has not demonstrated a point of substance or a serious question, it is not strictly necessary for me to consider whether the balance of convenience lies in favour of granting or refusing a suspension of the orders. Cf American Cyanamid v Ethicon Ltd [1975] AC 396 at 408. However there is one aspect of the applicant's claim that it will suffer substantial and irreparable harm unless a suspension is granted that requires comment. That is what is said to be the probability that its allocated places will be extinguished and the Secretary will be powerless to restore them if the applicant is successful on the review. In my view that fear is unjustified. There is nothing in the Act to support the view that the number of places available for allocation, as determined by the Minister for the relevant financial year, is reduced on the revocation of an allocation. Under s 18‑1 an allocation "ceases to have effect" if it is revoked under Part 4.4 (ss 64‑68). The implication is that the revoked places go back into the pool rather than that the pool shrinks or is not thereby deepened. In any event, s 14‑4(2) makes it clear that revoked places do not cease to exist, but are available for re‑allocation. Under s 14‑1(4) in order for an allocation to be made to an approved provider, the provider must have made a valid application and the allocation must comply with the terms of an invitation published under Division 13. Section 14‑4 empowers the Secretary to waive those requirements "if the places being allocated are places that have been relinquished under section 18‑2 or that were included in an allocation, or a part of an allocation, revoked under Part 4.4." 26 Accordingly, the applicant's fear that the places will not be available to it if it succeeds in the litigation because they will have disappeared is unfounded. Any fear that the places may have been re‑allocated to someone else and, assuming the pool to be empty, that there are none available to the applicant in the event of its success, is met by the statement by counsel for the respondents in open court that the applicant's places would not be treated by the respondents as revoked places available for re‑allocation until the review processes have been exhausted. By what I have said in this paragraph I should not be taken as expressing the view that if the Court set aside the decisions, the applicant would not thereby be restored to its former position as an approved provider with the allocated places that were never lawfully revoked, even if in the interim the Secretary had purported to re‑allocate them.