Application to the Minister's decision
113 A number of points made by the Full Court in Bat Advocacy should be reiterated:
(1) Omission of matters from the reasons of a decision-maker will not necessarily mean the matter has been overlooked and legal error committed;
(2) However, qualifying the first statement, a "failure to include reference to a matter in a statement of reasons may [but will not always] justify the inference that, as a matter of fact, the matter was not taken into account";
(3) Reasons, and/or evidence, may establish nothing more than "cursory consideration" of a matter which is then cast aside and this will not discharge the decision-maker's legal obligations; and
(4) What must be actively considered are the "salient facts" of a matter which is the mandatory consideration.
114 The Minister's reasons refer (at [16] and [54]) to the response by the applicant and his opposition to the application. Aside from this, and the references at [34]-[38] about the location of the applicant's two pharmacies, and their opening hours, there is no other express reference to the response submitted by the applicant in the Minister's reasons. As I noted earlier in these reasons, the following statement is made at [22], under the heading "Evidence". It is worth setting it out again:
Evidence
22. I considered the second Ministerial Submission from Mr Simon Cotterell, First Assistant Secretary, Provider Benefits Integrity Division of my Department, including the following:
• The first Ministerial Submission.
• Department's letter dated 10 August 2017 advising the Applicant of my decision to consider the request and the Applicant's response.
• Department's letters, dated 10 August 2017, to the owner of the two existing pharmacies in Mount Waverley and the response from Ms McGrath.
• Summary of the Ministerial discretionary process and the Location Rules.
• Map of the proposed pharmacy, nearest approved pharmacies and medical centres.
• Correspondence sent to me and my Department relating to the request to exercise my personal power.
115 The statement is ambiguous. On one view, use of the word "including" might suggest the reasons intend to state that the Minister "considered" (in the sense I have found that word is used in s 90D(3)) not only Mr Cottrell's ministerial briefing note dated 23 October 2017 (which I have called the decision briefing note), but also in fact "considered" the documents listed after the word "including". However, the list is in substance the entire list of what was attached to the decision briefing note. For reasons I have already explained, I am not prepared to infer that the Minister went beyond reading, and considering, the decision briefing note itself. I am not prepared to infer he read, or considered, any of the source documents attached to that briefing note and in particular the responses on behalf of the applicant by Ms McGrath. Insofar as the reasons might suggest otherwise, I do not consider they are sufficiently clear or probative (having been drafted by others and not proved by the Minister) for the Court to be satisfied the Minister "considered" anything outside the decision briefing note.
116 As I have noted above, the decision briefing note does purport to summarise the applicant's response. The applicant submits the summary is inadequate, and omits the three matters I have set out at [59] above. YL Health Group submits none of those matters are "so important" as to require the Minister to deal with them expressly. YL Health Group goes on to submit that the Minister was not required to deal with the applicant's proffered alternative description of the relevant "community", and that some of the other matters were factually contentious or not before the Minister.
117 The s 90D notice given to the applicant was relelvantly in the following terms:
Opportunity to comment
In the request, the pharmacist included evidence from a representative of the Waverley Family Health Care in relation to its proposal to open 24 hours a day, 7 days a week, being:
"I have previously communicated with nearby pharmacies in order to see whether they were prepared to provide 24 hour access to pharmaceuticals, however they were not prepared to do so."
As delegate of the Minister under paragraph 90D(1)(b) of the National Health Act 1953, I am writing to provide you with the opportunity to provide any comments, information or documentation relating to this information, or the request for approval more generally.
118 The focus of the question asked was clearly related to what 24 hour pharmacies were available close to Waverley Family Health Care (which became a focus in the decision briefing note and in the reasons), but the applicant was also invited to comment "more generally". The applicant provided a 19 page submission, with attachments. As the applicant contended, that submission canvassed a number of matters other than a response to the specific assertion from the director of the Waverley Family Health Care practice. The summary at the end of the applicant's submission indicates its content:
G. CONCLUSION
By way of summary:
1. the Relevant Community is not a community without reasonable access to the supply of PBS medicines (noting the existing 8 pharmacies and 1 pharmacy department within Mount Waverley collectively trade 7 days a week and are open during the trading hours of local doctors and medical clinics);
2. my client refutes any argument that the present trading hours of the existing pharmacies in Mount Waverley results in the Relevant Community being left without reasonable access to the supply of PBS medicines. To the contrary, in addition to the Waverley Private Hospital, existing nearby 24-hour pharmacies at Knox and Balwyn (which are within approximately 15 minutes travel by car during overnight hours) already readily satisfy any need that the Relevant Community has for PBS during hours which are outside the trading hours of the pharmacies located in Mount Waverley;
3. the approval of the applicant pharmacist's request will not be in the public interest. As set out above, existing pharmacies in the Relevant Community are plentiful including several 24 hour pharmacies located near the Relevant Community (and within 10.5 km of the Relevant Community in the case of Pharmacy@Knox) proven to be continuously able to provide the Relevant Community with reasonable access to PBS medicines;
4. the Threshold Test has not been met; and
5. the applicant pharmacist's request to the Minister does not align with the stated objectives of the Sixth Community Pharmacy Agreement.
On the basis of the information provided in this Comment, the Minister ought be satisfied that the criteria for a request for Ministerial discretion has not been achieved.
119 The reference to the "threshold test" is a reference to what is contained in the Guidelines, where it is stated that the intention of the s 90A power is to respond on an individual and timely basis in unique circumstances and where the application of the Rules has produced an unforeseen and anomalous situation and a community is left without reasonable access to the supply of PBS medicines (set out above at [50]). The applicant, in the submission made on his behalf by Ms McGrath, describes this passage as creating a "threshold test" that applies in addition to the two statutory criteria in s 90A(2):
It follows that in addition to the above two criteria, the threshold of any request by a pharmacist to the Minister for the exercise of the Minister's discretionary power must be in unique circumstances where the application of the Pharmacy Location Rules has resulted in an unforeseen and anomalous situation (Threshold Test) .
120 While it may or may not be appropriate to describe the passages in the Guidelines as imposing a "threshold test", it is plain that the Guidelines do seek to identify with some particularity the kinds of circumstances in which the s 90A discretion will be favourably exercised.
121 I find that most of the content of Ms McGrath's submission on behalf of the applicant is not addressed in the decision briefing note, nor in the reasons.
(1) While as I have noted earlier the Guidelines may have little relevance to the proof of legal error, it is certainly understandable that their content would be relied on by the applicant. After all, the Guidelines are promulgated by the Minister's department and are intended to guide s 90A applications. It is easily foreseeable that an opposing pharmacist would also resort to them. The Guidelines do contain what Ms McGrath describes as a "threshold test" although as I have noted that may not be the appropriate description of those passages in the Guidelines. Nowhere does the decision briefing note or the reasons address why the Department's own publicly stated approach to the s 90A power was not appropriate in the current situation and no attempt is made to explain whether YL Health Group application does or does not fit within the parameters of the Guidelines, and whether this is something the Minister should turn his mind to. Departure from a publicly stated position on how a power is likely to be approached and exercised is no insignificant matter.
(2) The applicant's contention that the relevant community should be defined as the "residents of Mount Waverley" is not addressed. As the applicant submits, there is no explanation in the decision briefing note nor in the later reasons, for why the group of persons the Minister has identified is the appropriate "community" to identify for the purposes of exercising the s 90A power. There is no explanation for why the applicant's description is inappropriate, or why the Minister has chosen to adopt a narrower definition. YL Health Group may be correct to submit the Minister was not obliged to refute the applicant's proffered description; but that is not quite the point. The point is that the absence of the Minister doing so in his reasons (and the absence of any references about this in the decision briefing note) may be evidence of a lack of consideration of what the applicant has said.
(3) The applicant made a specific contention that "reasonable access" in s 90A(2) did not mean, or require, that pharmacies must open 24 hours a day 7 days a week, that this would be contrary to the Rules and not sustainable for all pharmacies. This contention, which was substantial and went to the heart of the basis for YL Health Group's application, and the Minister's decision, which emphasised the need for out of hours pharmacy access close to the Waverley Family Health Care practice. It was not addressed at all in the decision briefing note nor in the Minister's later reasons, other than a scant dot point reference in the decision briefing note. However the main issue, was what "reasonable access" in s 90A requires and why the existing situation was one which would leave the relevant community without reasonable access. This was not the subject of any reasoning, other than of a conclusory kind. Again, this absence is, at an evidentiary level, and when put alongside the other omissions to which I refer, capable of supporting a proposition that the Minister did not "consider" the applicant's submission.
(4) The applicant contended that the trading hours of the eight existing pharmacies, and one pharmacy department attached to a private hospital in Mount Waverley covered all but one hour of the opening hours of the existing medical centres, including the existing hours of Waverley Family Health Care. This was not addressed in any way.
(5) The applicant identified existing 24 hour pharmacies which were located a reasonable distance from the Waverley Family Health Care practice, although outside Mount Waverley. There were four such pharmacies, which were between 10.5 and 34.4 kilometres away from the Waverley Family Health Care practice, and which the applicant contended, were readily accessible by private or public transport. The applicant noted that available census data indicated that over 90% of residents in Mount Waverley had at least one car. There was one entry on this topic in the decision briefing note's summary of Ms McGrath's document and in the Minister's reasons. The point made by the applicant was not directly refuted, nor any real explanation given by the Minister about why the existing situation was so insufficient as to leave a group "without reasonable access" to pharmaceutical benefits.
(6) The applicant's submission stated that the proposed pharmacy was only approximately 136 metres and 239 metres respectively from the applicant's two pharmacies. This is well inside the 500 metre limit in the Pharmacy Rules. The reasons briefing note and the Minister's reasons refer to the distances, albeit differently calculated, but still indicating how close the applicant's two pharmacies are. Taking into account what the authorities to which I have referred above say about the distance requirements, this close co-location was understandably a major point made by the applicant. Other than a reference to the fact of the distances, there is no reasoning which indicates why the additional burden on Commonwealth funds was justifiable, where the overwhelming majority of trading hours for the proposed pharmacy would overlap with the trading hours of these two pharmacies.
(7) The applicant's submissions contained an express refutation of the assertion upon which he had specifically been invited to comment by the Minister. At page 17 of his submissions, the following appears:
(i) Trading 24 hours
We refer to the following paragraph of the Notice:
"In the request, the pharmacist included evidence from a representative of the Waverley Family Health Care in relation to its proposal to open 24 hours a day, 7 days a week being:
I have previously communicated with nearby pharmacies in order to see whether they were prepared to provide 24 hour access to pharmaceuticals, however they were not prepared to do so."
The above second paragraph statement by the Applicant is incorrect. To the contrary, the actual facts are that my client met with the owner of Waverley Family Health Care in or about August 2014 in relation to the medical centre owner's proposal for my client to relocate the Centreway Pharmacy to within the medical centre premises. Following that meeting, my client considered the proposal and determined that the commercial rent sought by the owner of the medical centre for leasing the pharmacy space within the premises, was excessive and not commercially viable. Before my client had an opportunity to further discuss the terms of the offer with the owner of the medical centre, he was informed by the owner of the medical centre that the offer to lease the available space in the medical centre was withdrawn.
Accordingly, the evidence provided to the Minister is, in my client's opinion, false and misleading.
The third dot point in the decision briefing note is an inaccurate summary of what the submission actually said. If the Minister, as I have found, read or "considered" the decision briefing note, he could not be found to have "considered" this important aspect of the applicant's submission because the briefing note is inaccurate. There is nothing in the Minister's reasons about this issue which would remedy the flaw.
(8) The applicant's submission also contained (and attached) results of a survey completed by 127 customers of the applicant's two pharmacies, about their level of satisfaction with the availability of pharmacy services, including trading hours. While points might (or might not) be made about sample size and representativeness, relevantly these survey results were not addressed at all in the decision briefing note, nor in the Minister's reasons.
(9) Finally, as the applicant submitted, neither the reasons nor the decision briefing note deal expressly with the applicant's point, through Ms McGrath's submission, that the Mount Waverley area was already significantly below the Victorian average pharmacy to population ratio: that is, there was a high proportion of pharmacies already.
122 I accept the applicant's submissions that the three short dot points in the decision briefing note did not adequately or properly represent the response given by him. Contrary to the submissions of YL Health Group, it is not to the point that each of the arguments made by the applicant might have not been accepted by the departmental officers advising the Minister, or by the Minister, or that some may have been factually flawed. These are "merits" issues. What matters is what the absence of references to all of these arguments, or the brevity of references, says about the "consideration" given to the applicant's response to the s 90D invitation issued by the Minister to him.
123 What is established, in my opinion, is that there was no active intellectual engagement by the Minister with what the applicant had said. These matters may also establish there was no active intellectual engagement by those advising the Minister, but this is beside the point. I am satisfied the applicant has established that the Minister did not "consider" his response, as the law required him to do.
124 Ground one succeeds on this basis. There are three further matters which should be dealt with.
125 First, some of YL Health Group's submissions misidentify the mandatory consideration. For example, in answering the second of the three specific matters which the applicant contends were addressed in his submissions but not addressed by the Minister, YL Health Group submits:
The point is that it cannot be said that the pharmacy to population ratios were mandatory considerations for the Minister.
126 This is not the applicant's contention under ground one. As I have explained, the mandatory consideration was the "comments, information and documents" provided in response to the invitation. The Minister was obliged to engage actively and intellectually with what the applicant provided in response to his invitation. The question for the Court under ground one is whether on the evidence the Minister did so.
127 Second, the relevance of the Full Court's decision in Carrascalao must be considered. There were in fact two appeals heard together, and both concerned the exercise of the personal cancellation power in s 501(3) of the Migration Act. Several aspects may be relevant.
128 The Full Court addressed what is meant by the word "consider", although not in the context of statutory construction. There was no such word present in s 501(3). Carrascalao therefore is not a decision about mandatory considerations and what the repository of a power must do when required by a statute to "consider" a specific matter. The issue arose because, as the Full Court pointed out at [29]:
The Minister did not contest that he was obliged by law to give proper, genuine and realistic consideration to the merits of the case in determining whether or not to cancel a visa under s 501(3) of the Act. He denied, however, that this meant that he had to give consideration of some particular or definable quality to each of the items of evidence before him.
129 It was in this context that the Full Court examined, from [36] onwards, a number of authorities about what is involved in a legal obligation to "consider" a matter. Importantly for present purposes, one of the authorities to which the Full Court referred was the earlier Full Court decision in Tickner. In Tickner, as here, there was an express statutory obligation to "consider" representations made to the Minister (under the Aboriginal and Torres Strait Islander Heritage Protection Act 1984 (Cth)). I have dealt with Tickner above.
130 At [43]-[44] and [46], and in part picking up on what was said in Tickner, the Full Court embraced the "active intellectual engagement" approach to the kind of "consideration" obligation with which it was dealing in s 501(3).
131 At [48], (as noted above) the Full Court stated that a "finding by the Court that the Minister has not engaged in an active intellectual process will not lightly be made and must be supported by clear evidence, bearing in mind that the judicial review applicants carry the onus of proof".
132 At [61], having noted in some detail aspects of the statutory scheme it considered material to the grounds of review, in particular the personal nature of the power conferred on the Minister, the Full Court stated (at [61]):
In addition to the features of the statutory scheme just identified, it may be accepted that, despite the personal nature of the power, the Minister was entitled to obtain assistance from departmental officers and members of his private staff, including have them prepare summaries of information for review by him. There are, however, at least three qualifications to that proposition:
(a) any such summary which is materially deficient may give rise to an inference that the decision-making process was not properly conducted by the Minister (see, for example, Williams at [21]-[30]; Minister for Immigration and Multicultural and Indigenous Affairs v Schwart [2003] FCAFC 229 at [32]-[33] per Tamberlin, Mansfield and Emmett JJ; Roberts v Minister for Immigration and Multicultural Affairs (2004) 39 AAR 370 at [44] per French J; and Gbojueh v Minister for Immigration and Citizenship (2012) 202 FCR 417 (Gbojueh) at [63] per Bromberg J)
(b) the use of a departmental summary may not be appropriate when what is sought to be summarised is a substantive argument (as opposed to an assertion of fact). Attempts to summarise material of this kind may be fraught, because the manner of the summary may cause some of the substantive force which the document may otherwise have had to be lost; and
(c) the Minister's entitlement to have regard to a summary or submission prepared by his Department must take into account any statement or indication in such a document which advises the Minister of the need for him or her personally to consider relevant information in a document which is summarised, as is the case here in respect of the Department's submissions concerning both Mr Taulahi and Mr Carrascalao.
133 In the present proceeding, two out of the three exceptions or qualifications are present. The decision briefing note was incomplete, and inaccurate, insofar as it was represented to contain a summary of the applicant's response to the Minister's invitation to comment. Secondly, the applicant's response did contain substantive argument, as well as matters of fact. The most obvious examples are what was the appropriate "community" for the purposes of the exercise of the power, and what is meant by "reasonable access" in s 90A(2)(a). While the Minister of course did not have to accept what the applicant put, he did have to consider it. The decision briefing note does not attempt to summarise the competing positions, nor really even draw to the Minister's attention that there were competing positions on these matters, which were central to the exercise of power.
134 It is not unimportant in the Full Court's disposition of the appeals before it that in both cases, the Minister had previously made cancellation decisions in respect of the two appellants and as the Full Court found at [62] could be said to be somewhat familiar with their circumstances. That factor is not present in the current proceeding. Indeed, the finding I have made is that the only "familiarity" the Minister had when he exercised the power was with what was in the decision briefing note. I accept the Minister is also likely to have read, and "considered" the first briefing note given to him when he decided whether to consider exercising the power in s 90A pursuant to s 90B, but the contents were not materially different in terms of what was relevant to the actual exercise of power under s 90A.
135 Insofar as it has relevance to ground one of the applicant's judicial review application, I consider the decision in Carrascalao supports the approach I have taken.
136 Third, this is a personal power: Parliament has made it very clear the intention is that the Minister, and only the Minister, is able to exercise it. It is a power which the Minister has no duty to consider exercising. It is a power with considerable effects on a number of individuals and on the community which is the subject of the application, and on public funds.
137 Parliament having reposed a power of that nature in a member of the Executive, and taking into account what has been said by the Full Court in Carrascalao about the use of summaries, in my opinion the Court should not speculate, without a basis in probative evidence, about how a Minister engaged with the material before her or him. I have explained why I consider it appropriate to draw an inference that the Minister read and considered the decision briefing note itself: beyond this is sheer speculation. That is not to dispute where the legal onus of proof lies, but it is to recognise that knowledge of what the Minister did in the exercise of his power is specific to the Minister, and a forensic decision not to adduce any evidence may leave the Court unable to draw inferences contended for: see Australian Securities and Investments Commission v Hellicar [2012] HCA 17; 247 CLR 345 at [165]-[166]. For the reasons I have set out I am satisfied the applicant has proved that the Minister neither read nor "considered", at the time of the exercise of power, what was in the responses the applicant provided to the s 90D notice.
138 Where reasons are drafted by others well after the exercise of power, and settled by lawyers in anticipation (at least) of legal proceedings, I do not consider such reasons will provide an adequate basis for a Court to draw inferences about what the Minister read or considered, where the reasons are silent on such matters. In this case, the reasons were prepared some three weeks after the decision, and only in response to a request pursuant to s 13 of the AD(JR) Act.
139 It is true that in some cases, Carrascalao being an example, there is some evidence before the Court about the time the Minister had to make a decision, and the time available is used as part of the evidence on which an applicant relies to discharge the onus of proving that the consideration given by the Minister could not be described as an active intellectual engagement with the material before her or him. There is no such evidence in this case, on any side. The Minister took no active part in the hearing, but could have elected to do so. YL Health Group adduced no evidence, and made no submissions, about the process which occurred when the decision briefing note was placed before the Minister. The applicant made no submissions.
140 There was in evidence two affidavits sworn by Ms Lynda Hurley, an employee in the Pharmacy Approvals Section of the Provider Benefits Integrity Division of the Department of Health. It was through her evidence that the documents before the Minister at the time of the exercise of power were adduced. Her affidavit gave no direct evidence, and indeed no indirect evidence, about the timing of the decision-making process by the Minister. Her only relevant evidence (at [15] of the affidavit sworn on 27 February 2018) is, relevantly:
In October 2017, officers in the Pharmacy Approvals Section prepared a Ministerial Submission to the Minister for Health to assist him in deciding whether to exercise his discretionary power under s 90A of the Act, as requested by the Second Respondent. The Minister considered the Submission on 1 November 2017, and decided to exercise his discretion to approve the Second Respondent to supply pharmaceutical benefits from the proposed premises...
141 Therefore, the evidence is that at some time during the day of 1 November 2017, the Minister considered the decision briefing note and decided to exercise his power. I infer from Ms Hurley's position within the Department, and the way her evidence is expressed, that this evidence is hearsay (as are the reasons, at least as evidence of the Minister's "consideration"). There is nothing to suggest she was present when the Minister considered the decision briefing note. Ms Hurley has been put forward as an institutional witness to provide relevant documents and an accurate chronology. That is not a criticism of her evidence in any way, but her evidence is not of the kind that could assist the Court in understanding how much time the Minister devoted to the "consideration" of the decision briefing note, or indeed if he "considered", independently of the contents of the briefing note itself, any of its attachments.