Tisdall v Kelly

DR GEOFF MACFARLANE (AS A MEMBER OF PROFESSIONAL SERVICES REVIEW COMMITTEE NO. 325)

THE DETERMINING AUTHORITY (ESTABLISHED PURSUANT TO SECTION 106Q OF THE HEALTH INSURANCE ACT 1973)

The nature and history of the proceeding 1 The applicant in this proceeding is a medical practitioner. He seeks relief pursuant to the Administrative Decisions (Judicial Review) Act 1977 (Cth) ('the ADJR Act') in respect of the process which has resulted in a report of Professional Services Review Committee No. 375 ('PSRC 325'), constituted by the second, third and fourth respondents. The report contains a finding by PSRC 325 that the applicant has engaged in inappropriate practice. 2 The relief is sought on three grounds. First, the applicant alleges that both the first respondent, the Acting Director of Professional Services Review ('the Acting Director'), who was responsible for referring the applicant's case to PSRC 325, and then PSRC 325 itself, failed to ascertain which of the services performed by the applicant in the relevant period fell within the terms of their respective referrals. In essence, this ground involves a suggestion that the Acting Director and PSRC 325 were obliged to investigate which of the services concerned had not been performed within the particular location specified in the referral. Second, the applicant says that PSRC 325 made an error of law by misconstruing, or failing to apply correctly, a provision of a regulation pursuant to which a medical practitioner can be found not to have engaged in inappropriate practice, because of 'exceptional circumstances'. Third, the applicant says that the Acting Director denied the applicant procedural fairness by making the referral to PSRC 325 without notifying the applicant that the Acting Director was of the view that he should, or would, only entertain negotiations for a possible resolution of the matter by agreement if the applicant initiated those negotiations and acknowledged that he had engaged in inappropriate practice. 3 The proceeding was commenced in the Federal Magistrates Court on 19 February 2003. In the original application, the Health Insurance Commission ('the HIC') was named as the first respondent, the Acting Director was named as the second respondent and the remaining three respondents were the Chairperson and two other members of PSRC No. 325. By notice of motion, filed in the Federal Magistrates Court on 3 April 2003, the applicant sought to remove the HIC as a party to the proceeding, and to join as a party the Determining Authority. As well as seeking leave to amend the title to the proceeding accordingly, the applicant sought leave to amend the application in the form annexed to the notice of motion. On 9 April 2003, Federal Magistrate Hartnett made the orders sought and further ordered that, pursuant to s 39 of the Federal Magistrates Act 1999 (Cth), the proceeding be transferred to this Court. In the order was noted an undertaking by 'the fifth respondent', which I take to be the Determining Authority, that it would not make a draft determination until judgment had been delivered in the proceeding. The applicant duly filed the amended application for which he had been given leave. 4 On 23 June 2004, by consent of the parties, I made an order that the applicant file and serve any amended application and any affidavits and documents on which he intended to rely, on or before 9 July 2004. On 9 July 2004, a further amended application was filed. 5 Before turning to the applicant's specific grounds, it is necessary to examine the legislative scheme under which PSRC 325's report was produced, and to set out some of the facts.

The legislation 6 The scheme known as Medicare, a national scheme of medical benefits, is established by the Health Insurance Act 1973 (Cth) ('the Health Insurance Act'). By s 10(1) of that Act, where medical expenses are incurred in respect of a professional service rendered in Australia to an eligible person, Medicare benefit calculated in accordance with s 10(2) is payable, subject to, and in accordance with the Health Insurance Act, in respect of that professional service. Section 19(6) provides: 'A medicare benefit is not payable in respect of a professional service unless the person by or on behalf of whom the professional service was rendered, or an employee of that person, has recorded on the account, or on the receipt, for fees in respect of the service or, if an assignment has been made, or an agreement has been entered into, in accordance with section 20A, in relation to the medicare benefit in respect of the service, on the form of the assignment or agreement, as the case may be, such particulars as are prescribed in relation to professional services generally or in relation to a class of professional services in which that professional service is included.' 7 By s 20(1), medicare benefit in respect of a professional service is payable by the HIC on behalf of the Commonwealth to the person who incurs the medical expenses in respect of that service. By s 20A, where a medicare benefit is payable to an eligible person in respect of a professional service, the eligible person and the person by whom, or on whose behalf, the professional service is rendered may enter into an agreement, in accordance with the approved form. Under such an agreement, the eligible person assigns his or her right to the payment of the medicare benefit to the practitioner, and the practitioner accepts the assignment in full payment of the medical expenses incurred in respect of the professional service. The practice of assigning the entitlement to medicare benefit to the practitioner is commonly known as 'bulk billing'. 8 Regulation 13 of the Health Insurance Regulations 1975 (Cth) ('the 1975 Regulations') prescribes the particulars to be recorded, for the purposes of s 19(6) of the Health Insurance Act. By subregs (1A)(b) and (1B)(b), the information to be recorded must, or may, include the provider number of the medical practitioner concerned, depending upon circumstances not material to this proceeding. A medical practitioner may have more than one provider number, if he or she practises at more than one location, because a provider number is allocated in respect of a particular location of practice. 9 Medical practitioners are provided with a medical benefits schedule, which refers to various kinds of medical services, allocating an item number for each kind, so that medicare benefits may be claimed by reference to the item number for the service provided. Regulation 13(2) of the 1975 Regulations requires the recording of a description of the professional service and the item number of the item, or at least a description of the professional service sufficient to identify the item. For the purposes of the present case, the relevant schedule of item numbers is to be found in the Health Insurance (1999-2000 General Medical Services Table) Regulations 1999 (Cth). 10 From the information recorded and provided by medical practitioners, enabling medicare benefits to be paid, it is possible to determine the number of patients seen by a medical practitioner, using a provider number, within a specified period of time, and the types of services performed by that medical practitioner in relation to those patients. 11 Part VAA of the Health Insurance Act contains provisions relating to the Professional Services Review Scheme. Section 80 contains an outline of the provisions in Pt VAA as follows: '(1) This Part creates a scheme under which a person's conduct can be examined to ascertain whether inappropriate practice (see section 82) is involved. It also provides for action that can be taken in response to inappropriate practice. (2) Division 2 creates the administrative structure for reviewing conduct. It consists of the Director of Professional Services Review and the Professional Services Review Panel (including Deputy Directors of Professional Services Review). (3) Division 3 is about referral of a person's conduct for review. It provides for the Director to decide whether to set up a Professional Services Review Committee to consider the conduct. (4) Division 4 is about Professional Services Review Committees. It deals with the following: (a) the membership of Committees (Subdivision A); (b) how Committees reach their decisions (Subdivision B); (d) how Committees report their findings (Subdivision D). (5) Division 5 provides for the Determining Authority to make determinations to deal with inappropriate practice found by Committees. It also contains a link to the Medicare Participation Review Committee process in Part VB for some cases. (6) Division 6 contains machinery provisions relating to the Director of Professional Services Review, members of the Professional Services Review Panel, and arrangements for staff and consultants. (7) Division 7 deals with miscellaneous matters.' 12 In s 81(1), there is a definition of 'service' as follows: 'service means: (a) a service for which, at the time it was rendered or initiated, medicare benefit was payable; or (b) a service rendered by way of a prescribing or dispensing of a pharmaceutical benefit by a medical practitioner or a dental practitioner.' 13 Section 82 contains definitions of 'inappropriate practice'. The relevant definition for present purposes is that found in subs (1)(a): 'A practitioner engages in inappropriate practice if the practitioner's conduct in connection with rendering or initiating services is such that a Committee could reasonably conclude that: (a) if the practitioner rendered or initiated the referred services as a general practitioner - the conduct would be unacceptable to the general body of general practitioners'. 14 By s 83(1), the Minister administering the Health Insurance Act is empowered to appoint a medical practitioner to be the Director of Professional Services Review ('the Director'). By s 86(1)(a), the HIC may, in writing, refer to the Director the conduct of a person relating to whether the person has engaged in inappropriate practice in connection with rendering of services. Such a referral is known as an investigative referral. Section 86(4) provides: 'An investigative referral must: (a) contain particulars of all services rendered or initiated during the referral period by: (i) the person under review; or (ii) a practitioner employed by the person under review; or (iii) a practitioner employed by a body corporate of which the person under review is an officer; and (b) set out the reasons why the Commission considers the person under review may have engaged in inappropriate practice.'

15 Section 87(1) provides: 'An investigative referral must specify whether it relates to one or both of the following: (a) specified services; (b) services rendered or initiated by a practitioner that are one or more of the following: (i) services of a specified class; (ii) services provided to a specified class of persons; (iii) services provided within a specified location; (iv) services provided within a specified period.' 16 It is common ground in the present case that the investigative referral specified services provided within a specified location and services provided within a specified period, within the meaning of s 87(1)(b)(iii) and (iv). 17 By s 88, the HIC is obliged to send a copy of the investigative referral to the person under review within 48 hours of sending it to the Director. The copy must be accompanied by a notice inviting the person under review to make written submissions to the Director, within 14 days, stating why the Director should dismiss the referral without setting up a Professional Services Review Committee ('PSR Committee'). The person under review may then make such written submissions within the 14-day period. Section 89 then requires the Director to conduct an investigation, unless the Director decides to take no action or no further action. By s 89B, the Director has power to require a person by notice to produce documents. 18 The Director has three options in dealing with an investigative referral. Section 91 provides: 'The Director may dismiss the investigative referral if he or she is satisfied that there are insufficient grounds on which a Committee could reasonably find that the person under review has engaged in inappropriate practice in connection with rendering or initiating the referred services.' 19 The second option is found in s 92. The Director may enter into a written agreement with a practitioner in respect of the matters referred, under which the practitioner acknowledges that conduct during the referral period constituted engaging in inappropriate practice, specified action is to take effect, and the Director is to dismiss the referral. The specified action is listed in subs (2) and includes the possibility of reprimand, repayment of medicare benefit, non-payment of medicare benefit that would otherwise be payable, and disqualification from the provision of services, either altogether, or in respect of some services, some persons or classes of persons, or a specified location. An agreement does not take effect unless ratified by the Determining Authority. If ratified, it takes effect and is binding on the Director and the person under review. Depending upon the action specified in the agreement, various other consequences follow. 20 The Director's third option is to set up a PSR Committee, and make an adjudicative referral to the PSR Committee, to consider whether conduct by the person under review constituted engaging in inappropriate practice. By s 93(6), the Director is obliged to prepare a written report to the PSR Committee, giving the reasons why the Director thinks that conduct by the person under review may have constituted engaging in inappropriate practice, and to attach the report to the adjudicative referral. By s 93(7): 'The services that may be specified in the adjudicative referral in accordance with subsection (1) are any of the services particulars of which were contained in the investigative referral under paragraph 86(4)(a), whether or not the services were dealt with in the reasons given by the Commission under paragraph 86(4)(b).' 21 By s 94, within seven days after making a decision on the investigative referral, the Director must give written notice of the decision to the person under review and to the HIC. If the Director decides to make an adjudicative referral to a PSR Committee, the notice must be accompanied by copies of the instrument making the adjudicative referral and the attached report. 22 By s 95(1), a PSR Committee consists of a Chairperson and two other panel members, appointed by the Director. By s 95(2), the Chairperson and the other panel members must be practitioners who belong to the profession in which the practitioner was practising when he or she rendered or initiated the referred services. In particular, by subs (5), if the practitioner was at that time a general practitioner, the other panel members must also be general practitioners. 23 By s 101(2), the PSR Committee must hold a hearing if, after considering the matters the subject of the referral, it appears to the PSR Committee that the person under review may have engaged in inappropriate practice. By s 103, the person under review is entitled to various rights in relation to the hearing, including the right to attend and be accompanied by a lawyer or other adviser, to call witnesses to give evidence, to question persons giving evidence, to address the PSR Committee on questions of law arising during the hearing and to make a final address on questions of law, the conduct of the hearing and the merits of the matters to which it relates. The lawyer may give advice to the person under review, address the PSR Committee on questions of law arising during the hearing, and make a final address on questions of law, the conduct of the hearing and the merits of the matters to which it relates. By s 104, the notice of hearing must require the person under review to appear at the hearing and give evidence. By s 105A, the PSR Committee has power to compel the production of documents or the giving of information, by notice to the person under review or any other person whom the PSR Committee believes to have possession, custody or control of, or to be able to obtain, relevant documents. By s 106(2), the PSR Committee is not bound by the rules of evidence but may inform itself on any matter in any way it thinks appropriate. 24 By s 106H(1): 'The Committee is to make findings only in respect of services (the specified services) particulars of which are contained in the adjudicative referral.' 25 Section 106KA of the Health Insurance Act was enacted by the Health Insurance Amendment (Professional Services Review) Act 1999 (Cth) ('the Professional Services Review Act'). Section 106KA provides: '(1) Subject to subsections (2) and (2A), if, during a particular period (the relevant period), the circumstances in which some or all of the referred services were rendered or initiated constituted a prescribed pattern of services, the conduct of the person under review in connection with rendering or initiating services during that period in those circumstances is taken, for the purposes of this Part, to have constituted engaging in inappropriate practice. (2) If the person under review satisfies the Committee that, on a particular day or particular days during the relevant period, exceptional circumstances existed that affected the rendering or initiating of services by the person, the person's conduct in connection with rendering or initiating services on that day or those days is not taken by subsection (1) to have constituted engaging in inappropriate practice. (2A) However, subsection (2) does not affect the operation of subsection (1) in respect of the remaining day or days during the relevant period on which the person rendered or initiated referred services even if the circumstances in which the referred services were rendered or initiated on that day or those days would not, if considered alone, have constituted a prescribed pattern of services. (3) The regulations may prescribe, in relation to: (a) a particular profession; or (b) an identified group or groups of practitioners in a particular profession; circumstances in which services of a particular kind or description that are rendered or initiated constitute, or do not constitute, a prescribed pattern of services for the purposes of subsection (1). (4) The circumstances that may be prescribed under subsection (3) as circumstances in which services that are rendered or initiated constitute a prescribed pattern of services include, but are not limited to, the rendering or initiation of more than a specified number of services, or more than a specified number of services of a particular kind, on each of more than a specified number of days during a period of a specified duration. (5) The circumstances that constitute exceptional circumstances for the purposes of subsection (2) include, but are not limited to, circumstances that are declared by the regulations to be exceptional circumstances. (6) This section only applies to services rendered or initiated after the commencement of this section. (7) This section does not preclude the Committee from making a finding under this Subdivision (other than section 106KB) in relation to conduct during a particular period in connection with rendering or initiating services without considering whether or not the circumstances in which the services were rendered or initiated constituted a prescribed pattern of services.' 26 The matters to be prescribed for the purposes of subss (3) and (5) are found in regs 10 and 11 of the Health Insurance (Professional Services Review) Regulations 1999 (Cth) ('the 1999 Regulations'): '10 Circumstances constituting a prescribed pattern The circumstance in which services that are professional attendances constitute a prescribed pattern of services is that 80 or more such services are rendered on each of 20 or more days in a 12 month period. 11 Exceptional circumstances For subsection 106KA (5) of the Act, the following circumstances are declared as constituting exceptional circumstances: (a) an unusual occurrence causing an unusual level of need for professional attendances; (b) an absence of other medical services, for patients of the person under review during the relevant period, having regard to:

(i) the location of the practice of the person under review; and (ii) characteristics of the patients of the person under review.' 27 The pattern of services for which reg 10 provides has come to be known colloquially as the '80/20' rule. 28 Section 106KD of the Health Insurance Act requires the PSR Committee to prepare a written draft report of preliminary findings and to give it to the person under review, with a notice inviting that person to make written submissions suggesting changes, within 21 days. A practitioner under review may consent to the draft report including recommendations for the practitioner to be fully or partly disqualified, and about the nature and period of the disqualification. Section 106L then requires the PSR Committee to prepare a final report, which it must give to the person under review, the Director and the Determining Authority. There must be a delay of at least 28 days between the giving of the report to the person under review and the giving of the report to the Determining Authority. 29 Section 106Q establishes the Determining Authority. By s 106T, if a PSR Committee's final report contains a finding that a person has engaged in inappropriate practice, the Determining Authority must, within one month, make a draft determination in accordance with s 106U and give copies of it to the person under review and to the Director. There is then a period of 14 days during which the person under review may make written submissions, suggesting changes to any directions in the draft determination. Pursuant to s 106TA, within one month after the end of the 14-day period, and after taking into account any submissions, the Determining Authority must make a final determination in accordance with s 106U. Section 106U requires a draft determination or a final determination to contain one or more of a number of directions. These may involve reprimand of the person under review, counselling of the person under review, withholding of medicare benefit, repayment of medicare benefit already paid, or disqualification, either wholly or in respect of some services, some persons or classes of persons, or some locations. Disqualification can be for up to three years.

The facts 30 By instrument dated 19 December 2001, the HIC provided an investigative referral to the Acting Director, in respect of the applicant. As to the services referred, the investigative referral said: 'Pursuant to subsection 87(1) of the Act, this Investigative Referral relates to all services rendered by Dr Peter Thomas Tisdall which were rendered: i. within specific location or locations, namely: Private Consulting Rooms Rodney Chambers 178/D Allan Street KYABRAM VICTORIA 3620; and ii. within a specified period, namely on and from 5 January 2000 to and including 21 August 2000 (the referral period).' 31 The investigative referral made it clear that there was evidence that some of the applicant's professional attendances constituted a prescribed pattern of services for the purposes of s 106KA of the Health Insurance Act and reg 10 of the 1999 Regulations. In particular, it was suggested that the Commission's records for professional attendances rendered by the applicant during the referral period showed that he rendered 80 or more professional attendances per day on 66 occasions on and from 5 January 2000 to and including 21 August 2000. It may be noted that the referral period chosen was shorter than the maximum twelve-month period allowed by reg 10. 32 By letter dated 20 December 2001, the Director notified the applicant of the investigative referral. The letter referred to the Director's obligation to carry out an investigation of the referral. It continued:

'Following the investigation, I have the option to: · dismiss the referral for the reasons set out in section 91 of the Act, · enter into an agreement with you as set out in section 92 of the Act, or · refer the matter to a Professional Services Review Committee as set out in section 93 of the Act.' 33 The letter also invited submissions from the applicant within 14 days. The Commission also sent a notice, dated 19 December 2001, to the applicant, inviting submissions to the Director within 14 days. The applicant made submissions, by letter from his then solicitors, dated 4 January 2002. The letter invited dismissal of the investigative referral, pursuant to s 91 of the Health Insurance Act. It relied heavily on the proposition that all of the referred services were rendered or initiated under exceptional circumstances, within the meaning of reg 11 of the 1999 Regulations. It described the circumstances of the applicant's practice in Kyabram in some detail. The submissions suggested that the applicant expected to be able to provide further material in support of his submission from a number of people, including the Chief Executive Officer of the Kyabram Hospital. 34 On 14 February 2002, Acting Director made Adjudicative Referral No. 325, pursuant to s 93(1) of the Health Insurance Act. The services to which the referral related were expressed in the same terms as in the investigative referral. In the attached report, the Acting Director stated that the investigative referral presented credible evidence that the applicant rendered 80 or more professional attendances per day on each of 66 days during the referral period. The applicant's submission did not persuade the Acting Director that a PSR Committee could not conclude that the applicant had engaged in inappropriate practice. Accordingly, the Acting Director decided to make an adjudicative referral. 35 Also on 14 February 2002, the Acting Director made a formal appointment of the second respondent as Chairperson and the third and fourth respondents as members of PSRC 325. PSRC 325 conducted a hearing on 5 June 2002 and subsequently received a written submission by counsel for the applicant, dated 12 July 2002. 36 PSRC 325's draft report is dated 14 November 2002. The applicant's solicitor made a brief submission, by letter dated 17 December 2002, recognising that it was pointless for the applicant to repeat arguments that had already been put on the construction of the relevant legislative provisions. Accordingly, the final report of PSRC 325, dated 23 January 2003, was in the same form as the draft report. It will be necessary to refer in some detail to the contents of the final report in relation to the specific grounds on which the applicant relies. For present purposes, it is enough to say that PSRC 325's finding was that: 'Dr Peter Thomas Tisdall engaged in inappropriate practice by rendering 80 or more professional attendances on 20 or more days in the referral period, as this constituted a prescribed pattern of services under ss.106KA(1) of the Act, and for the purposes of ss.106KA(2) of the Act, it does not consider that exceptional circumstances existed that affected the rendering of services by Dr Tisdall on any of the days in question.' 37 On 28 July 2003, Ryan J delivered judgment in Daniel v Kelly [2003] FCA 772 (2003) 200 ALR 379. On 3 September 2003, the respondents' solicitors advised the applicant's solicitor of that judgment and suggested that it could affect the outcome of this proceeding. They indicated that the first respondent to this proceeding, the Acting Director, who was also a respondent in the Daniel case, was proposing to appeal from the judgment of Ryan J, and suggested that further proceedings in this application await the outcome of that appeal. The parties reached agreement to this effect. The appeal judgment was delivered on 6 February 2004. See Kelly v Daniel [2004] FCAFC 14 (2004) 139 FCR 64. The solicitor for the applicant does not appear to have become aware of that judgment until some time afterwards. When he did become aware of it, the applicant sought to amend his application further. The amendment was effected by consent of the parties. The amendment makes it clear that the applicant now wishes to challenge the decision of the Acting Director to make the adjudicative referral. As the time limit specified in s 11 of the ADJR Act for the making of an application in respect of that decision has long since expired, it is necessary for the applicant to seek the exercise of the Court's power pursuant to s 11(1)(c) of the ADJR Act to allow further time. The grounds on which the Acting Director's decision is challenged are identical to some of the grounds on which the finding of PSRC 325 is challenged. It is therefore appropriate to defer consideration of the time issue until after those grounds have been considered.

Services not rendered within the specified location 38 The applicant's contentions on this ground began with the proposition that PSRC 325 was limited by the effect of s 87(1) of the Health Insurance Act, and by the terms of the investigative referral and the adjudicative referral, to examining services rendered by the applicant within his consulting rooms at 178/D Allan Street, Kyabram. So much was conceded by counsel for the respondents. By s 87(1)(b)(iii), where services are to be investigated by reference to a location, the investigative referral is required to 'specify...services provided within a specified location'. The use of the word 'within' suggests that services rendered outside that location cannot be the subject of the deliberations of a PSR Committee. In the present case, the specification was limited to services 'rendered'; there was no reference to services 'initiated', as there might have been. The location was specified as the applicant's consulting rooms, and not by reference to any other geographical point or boundary, as it might have been. 39 The applicant took this point early in the hearing on 5 June 2002. The Chairperson of PSRC 325 asked him whether he accepted that the data relating to professional attendances and medicare benefits paid for each of the days referred was correct. The applicant replied: 'I accept that I saw these patients, yes, but I don't accept that they were seen at my private consulting rooms.' 40 When asked to expand on this, the applicant deferred to his counsel, who made the submission that the adjudicative referral was limited by the specification of the consulting rooms as the location, and that the applicant did not accept that he saw all the patients within that location, as he saw them in other locations, including the hospital, when there were emergencies to attend to. Counsel also said that the applicant had not been able to audit the hospital records, which he would need to do to determine where he saw particular patients. He submitted that on some of the days, the figure would probably come in under 80 if hospital emergencies were excluded. 41 Subsequently, in his oral evidence to PSRC 325, the applicant said that, because patients could not get in to see him, they would wait in the outpatients' area of the hospital, to see him when he went to the hospital. He said 'that could be one or two.' He also said that, often late in the day, he would get urgent calls to go to the nursing home or to the hospital. He said that if, in a given day, he saw 79 or 80 patients, two or three of them, or maybe five in that day could be emergencies. He said that 'often' or 'sometimes' five people a day were seen at the hospital and were reflected in the figures. 42 Later in the applicant's evidence, the Chairperson asked: 'And you have said that as a general rule up to five times a day you would need to go to the hospital?' 43 The applicant replied: 'No. No, I can't say that. I said it could be five times, it could be nought.' 44 The Chairperson asked for an average on a weekly basis. The applicant responded, 'maybe five times, maybe ten times. I can't be more specific than that.' He then said that it might be five in one day. 45 As to the number of patients who might be seen without appointments at the hospital early in the morning, or after the applicant finished his appointments, the Chairperson again asked for a weekly average. The applicant suggested that it was perhaps five a week. That included those in the morning and in the evening. He made the point that it was variable, but repeated the figure of five a week, 'maybe'. When pressed, he said that the number could be six or could be none. He was not sure of the numbers. He repeated that a significant number of patients had seen him at the hospital and had been put down as 'B visits' (a reference to a category in the medical benefits schedule) in the surgery, but this characterisation was not true. 46 On the basis of this evidence, counsel contended before me that it was not open to PSRC 325 to have been satisfied that the applicant's professional attendances at the specified location exceeded the prescribed limit. Only a proper investigation by the Director or PSRC 325 of records, including hospital records, could have determined which attendances were relevant to the referral. The applicant's counsel contended that PSRC 325 considered attendances that did not occur within the specified location, and thereby took into account irrelevant considerations and exceeded its jurisdiction. Alternatively, because the Determining Authority was required to act on the report of PSRC 325, the applicant could be adversely affected because it was not clear by how many he might have exceeded 80 services on any one day. 47 PSRC 325 addressed this issue in its report. It said that it needed to determine, on the available evidence, whether the applicant had rendered 80 or more professional attendances on 20 or more days during the referral period. Under the heading 'Was There a Prescribed Pattern of Services?' PSRC 325 said: '43. There was evidence in the Investigative Referral (Attachment B of the Adjudicative Referral) that Dr Tisdall had rendered 80 or more professional attendances per day on 66 occasions during the referral period. Report 1 at pages 18 and 19 of Attachment 1 lists these days and the numbers of professional attendances. Report 6 at pages 25 to 156 of Attachment 1 particularises all these attendances by date, patient name and Medicare item number. 44. Dr Tisdall's written submission received on 12 July 2002 submitted that the underlying factual basis of the referral to the Committee had not been established. It said that "the only location that was the subject of the referral to the Director was Dr Tisdall's private consulting rooms and the professional services were those rendered at those rooms." It also said that the Acting Director's adjudicative referral authorised the Committee "... to decide whether all professional attendances rendered by Dr Tisdall within the referral

period and within his consulting rooms (being the defined specified services) constitute engaging in inappropriate practice ...". 45. It was submitted that the Committee had no lawful authority to travel beyond the terms of the Adjudicative Referral and the submission noted Dr Tisdall's uncontested evidence that "... not all of the professional attendances identified in the attendance schedules supplied by the HIC as part of this referral were performed at the location specified in the referral notices ... during the relevant period, Dr Tisdall had professional attendances at various locations including, in particular, the nursing home, the hospital and private houses ...". 46. It was then submitted that "Bearing in mind that a significant number of the sixty six days (of eighty plus attendances) in the specified period involved less than ninety attendances and with a number days [sic] in the low eighties, on the evidence before it, the committee cannot be positively satisfied that Dr Tisdall's professional attendances at the specified location that are the subject of this referral, i.e. those in his consulting rooms, exceeded the prescribed limit. ..." 47. It was said that the Adjudicative Referral was therefore based on figures relating to professional attendances, and the location of where they occurred, which were simply wrong: "... it is incumbent on the committee to report back to the director, before going any further, that it cannot be positively satisfied that inappropriate practice has occurred within the terms of the referral due to the distinct possibility that there were significantly less than sixty six days of eighty plus professional attendances in the specified period at the specified location." 48. The Investigative Referral indeed related to all services rendered by Dr Tisdall within a specific location, namely his Consulting Rooms, Rodney Chambers, 178/D Allan Street, Kyabram, within the period 5 January 2000 to 21 August 2000 (Attachment 1, page 13). On a literal interpretation, this would be limited to services performed inside those particular premises. 49. However, the reason for the Investigative Referral (ie the conduct of concern) related to numbers of professional attendances on certain days identified in Report 1 and the specific attendances were particularised in Report 6. The Acting Director clearly relied on these attendances as his reason for making the Adjudicative Referral (see paragraph 9 thereof at page 6 of Attachment 1). Dr Tisdall was clearly on notice that all these attendances would be under consideration by the Committee, especially given the nature of a referral under s.106KA. 50. The lists of attendances in Report 6 of the Investigative Referral include 35 attendances elsewhere other than at Dr Tisdall's consulting rooms. The Committee considers it consistent with the intent of s.106KA of the Act to treat such professional attendances as being for services rendered within Dr Tisdall's consulting rooms. However, the Committee notes that the exclusion of these 35 professional attendances would nevertheless still leave a residue of 63 days on which Dr Tisdall rendered 80 or more professional attendances and thus constitute a prescribed pattern of services. 51. Dr Tisdall also stated that some attendances for out-patients at the Kyabram hospital were claimed as services at his rooms. The Committee acknowledges that this practice is commonplace in rural areas and is approved by the Department of Health and Ageing. With regard to Dr Tisdall's conduct in the context of a prescribed pattern of services, the Committee again considers it consistent with the intent of s.106KA of the Act to treat such professional attendances as being for services rendered within his consulting rooms. 52. The Table at Appendix 1 to this report summarises Dr Tisdall's oral evidence at the hearing as to the number of professional attendances rendered to out-patients at the hospital. Whilst Dr Tisdall's evidence was imprecise, it was clear that he would rarely see more than 5 out-patients per day at the Kyabram hospital, and usually many fewer. Since Dr Tisdall claimed Medicare benefit for these out-patient attendances as though they were rendered at his rooms, the Committee observes that the HIC had no way of knowing whether any, or which, were physically rendered in locations other than his consulting rooms. 53. If the Committee allows 5 out-patient attendances (a generous estimate) on each of the 63 days (ie after taking into account the non- consulting room professional attendances referred to in paragraph 50 above), Dr Tisdall would still have rendered 80 or more professional attendances per day on 35 days during the referral period. This figure still significantly exceeds the threshold of 20 such days contained in regulation 10. 54. Having considered the issue of the volume of professional attendances rendered by Dr Tisdall during the referral period (whether the services were rendered at his consulting rooms or elsewhere), the Committee finds that Dr Tisdall's conduct in rendering 80 or more professional attendances per day on 20 or more days constituted a prescribed pattern of services.' [footnotes omitted] 48 Among the documents accompanying the investigative referral, which both PSRC 325 and the applicant had, was a complete schedule of professional attendances rendered by the applicant for each of the days referred. This schedule included the name of each patient, the item number from the medical benefits schedule and the amount of medicare benefit paid. This was a complete list of all of the services rendered by the applicant during the referral period, for which he had recorded his provider number, which was his provider number in respect of his consulting rooms at Kyabram. From this basic data had been extracted various summary lists, described as reports. Report 1 disclosed each day on which the applicant had verified 80 or more professional attendances and the medicare benefits paid for each of the 66 days on which the applicant was alleged to have rendered 80 or more services at the specified location. In other words, this was a list of the 80 or more claims for medicare benefit, in relation to which the applicant had recorded the provider number linked to his consulting rooms on the days in question. 49 The applicant therefore had the means of drawing to PSRC 325's attention the precise patients whom he had seen other than at the specified location on any of these days, if his memory or his records enabled him to do that. He did not choose to attempt that task. He now says that PSRC 325 should have undertaken that task itself, by exercising its powers to compel the production of documents in relation to records of the hospital. The applicant made no request to PSRC 325 for such an exercise of its power. He did not say whether or not, by going through the lists and by reference to his memory, or his records, he could discern which of the patients he had seen outside his consulting rooms. 50 Another report that PSRC 325 and the applicant had, derived from the raw data, was an item description of medicare services rendered by the applicant during the referral period. This gave the total number of patients, and the total number of services with respect to various item numbers. This table discloses a total number of after-hours consultations (items 1 and 2) of 64, rendered with respect to 63 distinct patients. Level A hospital consultations amounted to five, with respect to one patient, compared with ordinary Level A consultations of 1432, with respect to 726 patients. Level B home visits amounted to 25 in respect of 15 patients, Level B hospital consultations to 184 in respect of 25 patients, and Level B nursing home consultations to 16 in respect of six patients, compared with Level B consultations of 13 646 in respect of 3786 patients. Of Level C hospital consultations, there was a mere one, in respect of one patient, compared with Level C surgery consultations of 10 in respect of 10 patients. Interestingly, in respect of item 601 'attendance other than at cons rooms', there were four in respect of four patients. The list continues in relation to a number of more specific items, but these figures give some indication of what PSRC 325 might have drawn by way of conclusion as to the merit of the applicant's vague complaint that services rendered outside his consulting rooms should not be taken into account. 51 As its report shows, PSRC 325 did examine in detail the raw figures (to which it referred as Report 6 in [49] and [50] of its report), for the purpose of testing the applicant's claims about services rendered outside his consulting rooms. It located 35 attendances other than at the consulting rooms. Counsel for the applicant complains about the next sentence, which indicated that PSRC 325 took the view that it could treat those attendances as being for services rendered within the consulting rooms. It is clear that PSRC 325 could not do that, having regard to the strict form of s 87(1) of the Health Insurance Act, and the form of the investigative referral and the adjudicative referral. PSRC 325 did not leave it at that, however. It went on to say that, even the exclusion of those 35 professional attendances would bring the number of days on which the applicant rendered services numbering 80 or more down from 66 to 63. 52 In the following three paragraphs, PSRC 325 dealt with the evidence about attendances for outpatients at the hospital, for which the applicant claimed medicare benefit on the basis that they were services rendered at his consulting rooms. It did not reject the applicant's evidence about those services, but commented that the Commission had no way of knowing whether any, or which, were physically rendered in locations other than the consulting rooms. In [53], PSRC 325 then made an allowance of five per day for outpatient attendances, which it described as a generous estimate, on each of the 63 days. This brought the figure of 80 or more services rendered on a day in the consulting rooms down to 35 days. As PSRC 325 said, this figure still significantly exceeds the 20 days allowed by the 80/20 rule for a 12 month period. In the light of these calculations, PSRC 325 found in [54] that the applicant's conduct constituted a prescribed pattern of services. 53 The task of PSRC 325 was to determine whether the applicant had engaged in inappropriate practice. It was required to determine this by the application of the 80/20 rule. This task PSRC 325 understood perfectly well and performed correctly. It may have made an error in saying that it could take into account services rendered outside the consulting rooms as consistent with the intent of s 106KA, but this error did not lead it into error in respect of the ultimate finding that the applicant engaged in inappropriate practice. Its subsequent reasoning disclosed that, whatever allowance it made for the consultations shown by the records to have occurred outside the consulting rooms, and for the applicant's vague evidence about the possibility of other such consultations, it was still forced to the conclusion that the applicant had engaged in inappropriate practice. 54 There is no substance to the applicant's contentions that PSRC 325 took into account irrelevant considerations and thereby exceeded its jurisdiction. If PSRC 325 did take into account irrelevant considerations, being the consultations that did occur outside the consulting rooms, its error in doing so did not affect the exercise of its power. If the applicant had wished to give more specific evidence about those consultations, it was open to him to do so. What he could not do was to place the onus on PSRC 325 to fill in any gap in his case, by simply raising the issue and not pursuing it. PSRC 325 was not bound to use its coercive powers to procure the production of hospital records, although it would have been open to it to do so had it wished. Compare the approach taken by the Court to the power given to the Refugee Review Tribunal by s 427(1)(d) of the Migration Act 1958 (Cth) to direct an investigation in Minister for Immigration & Multicultural Affairs v Anthonypillai [2001] FCA 274 (2001) 106 FCR 426 at [86], Kabir v Minister for Immigration & Multicultural Affairs [2001] FCA 248 (2001) 184 ALR 295 at [54] - [55], and the authorities cited by Katz J in the latter. 55 It was open to the applicant, if he wished, to attempt to obtain the relevant hospital records and, if he could not do so, to seek the assistance of PSRC 325 explicitly. In this regard, it is significant that, among the material the applicant placed before PSRC 325, was a witness statement of the Chief Executive Officer of the Kyabram and District Memorial Community Hospital. There was also a statement by the Director of Nursing at the Tongala and District Memorial Aged Care Service facility. Neither referred to numbers of services rendered by the applicant at the hospital or the aged care facility during the referral period. The real complaint of the applicant is that PSRC 325 did not make his case for him. It was not obliged to do so. 56 It must also be remembered that it is the applicant who seeks to establish that the Acting Director and PSRC 325 erred in the manner described in the grounds contained in s 5 of the ADJR Act, in making a finding of engaging in inappropriate practice against him. In this Court, the onus is on the applicant to establish the errors alleged. He cannot do so by simply raising a doubt as to the correctness of findings of fact made by PSRC 325. Error of the kind required will only be found if the evidence in this Court establishes it. The applicant made no attempt to place before this Court any records of the hospital or the aged care facility, for the purpose of demonstrating the falsity of the figures on which PSRC 325 relied. He cannot succeed without doing so. Compare R v Alley; Ex parte New South Wales Plumbers and Gas Fitters Employees' Union (1981) 153 CLR 376. 57 Further, the relief available pursuant to the ADJR Act is discretionary relief. The applicant's point is obviously without merit. The purpose of the legislative scheme under which the professional services review was conducted is to ensure that doctors do not overload themselves, but are able to give to each patient in respect of each service rendered adequate care and attention. In terms of merits, it is no answer to the sort of allegation levelled against the applicant that, in addition to rendering 80 or more services on 35 or more days in a period of less than eight months, he also reduced his capacity to give proper care and attention to his patients by taking extra time in seeing patients at other locations, perhaps on those and other days. If the applicant had made out any ground in s 5 of the ADJR Act in this respect, and this were the only ground upon which the applicant could base his application for relief, in the exercise of my discretion, I should have refused him that relief because of the want of merit in his case. 58 To the extent to which the Determining Authority will have to judge the degree of culpability of the applicant, when it comes to deal with the question of directions pursuant to s 106U of the Health Insurance Act, it will have before it the entire report of PSRC 325. It is obvious that the Determining Authority will have regard to the specific finding of PSRC 325 that the applicant engaged in inappropriate practice on 35 days during the referral period. I cannot imagine that the Determining Authority would act on the basis that the applicant had engaged in inappropriate practice on 66, or 63, days, in the light of PSRC 325's reasoning.

Exceptional circumstances 59 In [25] - [41] of its report, PSRC 325 discussed at length what was meant by 'exceptional circumstances' in s 106KA(2) of the Health Insurance Act. It drew attention to the words 'on a particular day or particular days during the relevant period' in that subsection. It said that reg 11(b) of the 1999 Regulations appeared to include what might be on-going circumstances. PSRC 325 then referred to relevant extrinsic materials, citing s 15AA of the Acts Interpretation Act 1901 (Cth) ('the Acts Interpretation Act') as requiring it to prefer an interpretation promoting the purpose of a legislative provision. It referred to s 15AB of the Acts Interpretation Act as permitting it to confirm a meaning, or resolve an uncertainty, by having regard to extrinsic material. 60 In PSRC 325's view, both the Second Reading Speech and the Explanatory Memorandum for the Bill that led to the Professional Services Review Act made it clear that the Bill was intended to implement recommendations in a report by a Review Committee of the Professional Services Review Scheme ('the Review Committee'). The Review Committee recommended the inclusion of 'deeming' provisions in the legislation, to overcome the difficulty of assessing extremely high volumes of servicing. It recommended the 80/20 rule. It also recommended that a practitioner be able to demonstrate to the satisfaction of a PSR Committee that exceptional circumstances occurred, which allowed them to practice appropriately while rendering such a high number of services. PSRC 325 characterised this as recognising that, in a crisis, a sub-standard service could well be more acceptable than none, and in that sense not be inappropriate practice. At [36], PSRC 325 referred to what it described as examples given by the Review Committee of exceptional circumstances. The examples were an exceptional event or a very extreme geographic circumstance. PSRC 325 stated that the Review Committee had said that regard may be had to the availability of alternative medical services or unusual occurrences causing unusual levels of need for medical services. PSRC 325 then quoted from the Review Committee's report: 'The Review Committee believes high levels of skill, competence and organisational arrangements are worthwhile and important. However, while they may have a great effect in a practitioner's ability to provide 50 rather than 20 consultation services regularly in a day, they have little effect at the 80 consultation services a day mark. It is, therefore, expected that argument that a practitioner's ability or organisation provides an exceptional circumstance is unlikely to be sustained.' 61 PSRC 325 went on to say, in [37] of its report: 'This Committee considers that these examples and comments confirm that 'exceptional circumstances' were seen as being generally intermittent or episodic situations beyond the practitioner's control but necessitating the provision of medical services as well as practicable.' 62 PSRC 325 then referred to examples of exceptional circumstances given in the Explanatory Memorandum as including the absence of alternative medical services to the practitioner's patients or unusual occurrences causing unusual levels of need for consultation services. According to the Explanatory Memorandum these examples gave effect to the recommendation of the Review Committee. 63 PSRC 325 then continued: '40. This Committee considers that these passages also confirm that "exceptional circumstances" were seen as most likely to be of an intermittent or episodic nature, rather than a predictable on-going situation. The Committee does not see that some extreme on-going circumstance is totally ruled out (if "particular days" can be "many days") - although the general body of general practitioners would ordinarily expect a practitioner to manage their practice to promptly bring patient attendance rates down to acceptable levels such that proper clinical care can be provided to all patients. 41. In summary, it appears to the Committee that ss.106KA(1) and the Regulations implement a view of the legislature that it is most unlikely that 80 or more professional attendances can be rendered satisfactorily on a given day. The "20 or more days" proviso acknowledges that the exigencies of normal practice may occasionally require a doctor to provide more attendances in a day than would otherwise be considered satisfactory. But by ss.106KA(2), exceptional circumstances will be required to justify 20 or more such days. Thus, the exception may be read as excusing lower standard services on particular days because of exceptional circumstances - but it is difficult to justify this on an on-going basis.' 64 Counsel for the applicant contended that what appears in [40] and [41] of the report of PSRC 325 involved an error of law. He contended that it was too narrow a construction of reg 11(b) of the 1999 Regulations to say that it may be read as excusing lower standard services on particular days because of exceptional circumstances, but that it is difficult to justify this on an on-going basis. 65 It appears that the passage appearing in [25] - [41] of PSRC 325's report is something of a standard form passage in the report of a PSR Committee. It appears to be similar to those in the reports of the PSR Committees that were the subject of the judgments in Hatcher v Cohn [2004] FCA 1548 and Oreb v Willcock [2004] FCA 1520. Both those judgments were delivered on 30 November 2004, after the hearing of the present case. Independently, each of the judges held that there was error of law in the way in which the PSR Committee concerned had approached the content of reg 11(b). 66 Prior to reading the judgments in Hatcher and Oreb, I inclined strongly to the view that PSRC 325 had approached the construction of s 106KA(2) of the Health Insurance Act and reg 11(b) of the 1999 Regulations correctly. As I have said, it is plain that the purpose of the legislative scheme is to ensure that a medical practitioner is not so busy as to be unable to give proper care and attention to each patient to whom the medical practitioner renders a service. If it is necessary to go to extrinsic materials, in order to establish this purpose, in accordance with ss 15AA and 15AB of the Acts Interpretation Act, then as PSRC 325 said, the Second Reading Speech and the Explanatory Memorandum for the relevant Bill, coupled with the report of the Review Committee of the Professional Services Review Scheme make the purpose abundantly clear. An absolute and arbitrary limit on the number of patients a doctor could see in a day would have carried into effect this purpose, but would have been obviously heavy-handed. Accordingly, in s 106KA(2), Parliament chose to cast onto the medical practitioner the onus of showing that, 'on a particular day or particular days during the relevant period, exceptional circumstances existed'. The choice of language is appropriate for the purpose. If circumstances that existed throughout the relevant period were to be regarded as 'exceptional', this would defeat the purpose of the scheme. A prime example is the circumstance alleged in this case as one of the exceptional circumstances, and also alleged in Hatcher and Oreb. That is shortage of medical practitioners in the region concerned. The purpose of the scheme in this respect is to encourage medical practitioners to take steps to overcome such an on-going problem, for the benefit of all patients. If an on-going circumstance of this nature were to be regarded as exceptional, the purpose of the scheme would be defeated. Every medical practitioner practising in an area in which there was a shortage of other medical practitioners would have to be excused from compliance with the rule limiting the numbers of patients to be seen in a day, because such a medical practitioner's circumstances would be, and would continue to be, exceptional. It is for this reason that Parliament chose to include the words 'on a particular day or particular days during the relevant period', rather than simply saying 'in the relevant period'. To ensure that the purpose is carried into effect, the focus is on the particular day or particular days. This construction is supported by the subsequent addition of s 106KA(2A), with its reference to 'the remaining day or days during the relevant period'. 67 The report of the Review Committee appears to have recognised that there will be circumstances that can be described as exceptional, even though they do occur on every day during a relevant period. One of the examples it gave of how 'exceptional circumstances' might be defined was 'a very extreme geographic circumstance.' It referred specifically to the availability of alternative medical services. PSRC 325 recognised this. It did not confine itself to intermittent or episodic situations, but recognised that 'exceptional circumstances' would generally, or most likely, be of an intermittent or episodic nature. PSRC 325 did not rule out an extreme on-going circumstance. On the view that I formed, PSRC 325 analysed correctly the meaning and effect of s 106KA(2) and reg 11(b). If, in its terms, reg 11(b) exceeded the ambit of the power given by s 106KA(3) to prescribe exceptional circumstances, then it would be necessary to read it down, by the application of s 46(1)(b) of the Acts Interpretation Act, so as to cause it to be within power. The result of such a reading down would be to produce an interpretation much like that adopted by PSRC 325. 68 Because of the tentative view I had formed, I have examined closely the reasoning in each of Hatcher and Oreb. In Hatcher at [53], Kiefel J said: 'It does not seem to me that the 'exceptional circumstances' in s 106KA(2) should be read as importing some temporal element. The words are not directly qualified and there is nothing in the purpose or object of the subsection which would suggest that such a limitation was either intended or necessary. The purpose of the provision is to protect a practitioner where the large number of consultations are shown to have been brought about by circumstances which are out of the ordinary and, one would think, beyond their control. Protective provisions ought not be construed in such a way as to limit their scope'. 69 In [54], her Honour went on to say that the words 'on that day or those days' in s 106KA(2) should not be taken to limit the duration of the circumstances which are exceptional. At [55] - [56], her Honour compared reg 11(a) with reg 11(b), to confirm her view that 'exceptional circumstances' are not restricted to some days or some other short period. At [57], her Honour said: 'The circumstances referred to in reg 11(b) might pertain to a lengthy and even an indefinite period. Exceptional circumstances will exist so long as there are no other medical services available to the practitioner's patients. In some rural or remote areas this may not be a matter which can readily be resolved. The fact that it is a circumstance which might maintain for some time was acknowledged by the Committee itself.' 70 At [58], her Honour expressed the view that the PSR Committee was in error 'in limiting the operation of "exceptional circumstances" to intermittent or episodic events and denying their application to circumstances which were of an on-going nature.' Her Honour held that this error affected the findings of the PSR Committee relating to the practitioner's claim that a shortage of medical services put him in a position where he had no choice to see an unacceptably high number of patients.

71 In my view, with great respect, her Honour made fundamental errors in the way in which she approached the issue. Her Honour failed to acknowledge that it is the words 'on a particular day or particular days during the relevant period' that import the 'temporal element' into 'exceptional circumstances'. In looking only at the purpose of the exception, in my view, her Honour failed to acknowledge the purpose of the legislative scheme as a whole, and the manner in which that purpose might be defeated by construing the exception in the way that her Honour did. To construe reg 11(b) by reference to reg 11(a) was of some assistance, but her Honour did not ask the question what it was that the power to prescribe 'exceptional circumstances' for a particular day or particular days entitled the regulation-maker to do. Although her Honour recognised that the fact that a circumstance might maintain for some time was acknowledged by the PSR Committee, her Honour nevertheless found that the PSR Committee limited the operation of 'exceptional circumstances' to intermittent or episodic events and denied their application to circumstances of an on-going nature. Neither in the report of that PSR Committee, nor in the report of PSRC 325 in the present case, was such a limitation imposed, or did such a denial occur. As I have said, PSRC 325 was ready to recognise that there was a possibility of 'exceptional circumstances' being of an on-going nature, but that they were most likely to be of an intermittent or episodic nature. For these reasons, I regrettably find myself unable to follow the reasoning in Hatcher. I view it as fundamentally wrong. 72 The approach of Jacobson J in Oreb was somewhat different. His Honour viewed the PSR Committee's examination of s 106KA(2) and reg 11(b) by reference to extrinsic material as an attempt to resolve an ambiguity. At [216], his Honour held that there was no ambiguity in those provisions and that the approach taken by the PSR Committee placed an unwarranted gloss on their meaning. At [219], his Honour acknowledged the limitation that the circumstances must exist on a particular day or days. Like Kiefel J, his Honour compared reg 11(a) and 11(b). At [220], his Honour said: 'Exceptional circumstances under Reg 11(b) therefore include an absence of other medical services during that period, having regard to the location of the practice and the characteristics of the patients. There is nothing in the language which restricts this to episodic events. Indeed, Reg 11(b) seems to have been deliberately drawn so as to broaden the category of circumstances beyond those contemplated by Reg 11(a).' 73 At [221], his Honour turned to the question whether it was possible to reconcile reg 11(b) with the requirement that exceptional circumstances must have existed on a particular day or days. His Honour said: 'It seems to me that it is. If the circumstances exist on an ongoing basis "during the relevant period" they will exist on a particular day or days. That is not to say that the Committee must find ongoing circumstances to be exceptional. It will be for the Committee to decide whether they take the case out of the ordinary. That will be a question of fact for the Committee which will, ordinarily, be immune from judicial review.' 74 At [222], his Honour also said that the PSR Committee had wrongly imposed a heavier onus on a person under review of satisfying it that circumstances are exceptional where they are on-going. His Honour held that this was an error. At [223], his Honour found that the PSR Committee's findings resulted from incorrect interpretation of the 'exceptional circumstances' provision. This was on the basis of the heavier onus point. 75 Again, with respect, I regret that I have reached the view that Jacobson J's reasoning in Oreb is fundamentally wrong. Opinions might differ about whether a provision is ambiguous. I share PSRC 325's view that the combination of the provisions of s 106KA(2) and reg 11(b) is less than clear. It is not necessary to have ambiguity in order to seek assistance from extrinsic materials as to the proper construction of a legislative provision. Sections 15AA and 15AB of the Acts Interpretation Act make this clear. PSRC 325 certainly went to the extrinsic materials to ascertain the purpose of the legislative scheme. This was a legitimate thing to do. His Honour did not do it. In my view, his Honour was wrong to reach the conclusion that circumstances existing on an on-going basis 'during the relevant period' will exist on a particular day or days. As I have said earlier, if Parliament had chosen to use the words 'in the relevant period', rather than 'on a particular day or particular days during the relevant period', there would have been a far stronger case for reading the provisions in the way that his Honour did. In my view, it is clear that, in the context of the legislative scheme, the intention is that, in most cases, the 'exceptional circumstances' are to be restricted as those that occur occasionally. To the extent to which on-going circumstances can be regarded as exceptional, they will be much rarer kinds of circumstances. I disagree with Jacobson J's proposition that exceptional circumstances under reg 11(b) necessarily include an absence of other medical services during the period, having regard to the location of the practice and characteristics of the patients. Whether such circumstances do amount to 'exceptional circumstances' is a question of fact for the PSR Committee in each case. To adopt a rule that such circumstances are always to be regarded as exceptional would be to defeat the legislative purpose. 76 It is too big a step for me to take to regard circumstances that occur on every day during a period, and which may therefore be considered to be normal, as 'exceptional circumstances', occurring 'on a particular day or particular days during the relevant period'. I can contemplate that an unusual event, such as an epidemic or a large-scale tragedy could be regarded as falling within this formula, even though its effects continued for some time, and perhaps throughout the relevant period. In my view, it is much more difficult to accept that a shortage of medical practitioners in a region can be so regarded. There is no question of imposing a heavier onus. There is merely an acknowledgement that a PSR Committee must look more closely at circumstances such as a shortage of medical practitioners, which are on-going, to see whether they can be described properly as 'exceptional'. For these reasons, I regret that I am unable to follow the reasoning of Jacobson J in Oreb. 77 More recently, Jacobson J has followed the reasoning of Kiefel J in Hatcher, and his own reasoning in Oreb, in two other cases: Lee v Kelly [2005] FCA 26 at [43] - [46] and [55]; and Lee v Grigor [2005] FCA 25 at [41]. I am not persuaded by the developing line of authority that the reasoning in Hatcher and Oreb ought to be followed. It may be that a Full Court will be required to settle the question. 78 It follows that I am of the view that PSRC 325 did not fall into error in the present case in adopting the view that it adopted about the meaning of 'exceptional circumstances'. In my view, PSRC 325 was correct in the conclusions it reached. It then proceeded to apply its view to the circumstances that the applicant had advanced as exceptional. It accepted that there was an on-going shortage of doctors in the Kyabram district and found that this was common in rural and some urban areas and not unique to Kyabram. It referred to the fact that other doctors in town had been able to make practice management decisions that did not involve them seeing the same large number of patients as the applicant. It believed that the applicant was similarly capable of limiting his patient numbers had he wished to do so. It referred to the fact that he had mentioned closing his books, but had not in fact done so. It did not accept that a shortage of doctors was exceptional on the facts of the case, because the applicant could have limited his patient numbers through more effective practice management. In addition, it took the view that the shortage was not an exceptional occurrence on particular days. 79 There were other circumstances involving lack of cooperation between the other doctors in Kyabram and the applicant. This had occurred since the early 1990s. PSRC 325 believed that the applicant could have put in place strategies to allow reasonably for after-hours emergencies for his patients, so it did not consider this to be an exceptional circumstance. Because of the long-term nature of the situation, PSRC 325 did not think that it was an exceptional occurrence on particular days. 80 PSRC 325 did not consider that social factors, such as an older and less wealthy population, a growing unemployment and drug problem and the existence of patients in a nursing home were exceptional. It found that these were common factors and that doctors working in low socio-economic areas were able to manage their practices in such a way that they did not breach the 80/20 rule. PSRC 325 also noted that these features were long-standing features of the applicant's practice, rather than being exceptional circumstances on particular days. 81 PSRC 325 also considered the applicant's claim that he could deal with patients quickly, because of his experience, stamina and dedication. It found that these were common factors as well. It again noted that this was a regular and long-standing feature of the applicant's practice and so it was not an exceptional event on particular days. 82 PSRC 325 next considered whether the applicant's recent accreditation by Australian General Practice Accreditation Ltd (AGPAL), which provides accreditation for general practitioners in Australia, was an exceptional circumstance. It noted that AGPAL had assessed that the applicant was unable to satisfy a criterion that consultation times are long enough to allow quality care, but that he was granted accreditation because AGPAL took into account shortages affecting the area. PSRC 325 drew attention to differences in criteria applied by AGPAL, to the fact that AGPAL would be reviewing the issue at re-accreditation, and to the fact that it had already taken into account shortages, in deciding that accreditation did not constitute exceptional circumstances. 83 PSRC 325 accepted that the applicant provided obstetrics, minor surgery and x-ray reading services to his patients, but considered that this did not constitute exceptional circumstances because the skills involved were not exceptional for a general practitioner. It also considered a claim that the applicant provided psychiatry services, but concluded that the number of psychiatric patients was 'quite small'. It did not accept that other doctors were unable to provide psychiatric services or that they did not treat psychiatric illnesses. It believed that many general practitioners throughout Australia would practice similarly, as most see and treat psychiatric illnesses as a routine part of general practice. It concluded that this is not an exceptional circumstance. 84 PSRC 325 considered the applicant's claim that he saw Turkish patients, requiring cultural and language sensitivities. It found that he acknowledged that he did not speak Turkish and he did not provide any evidence of his skills in this area except to say that he had a rapport with Turkish people. He said that he speaks some Italian because he had a number of Italian patients. PSRC 325 did not accept that this constituted exceptional circumstances, as it is a common occurrence for Australian doctors to see a cultural mix of patients and to speak a little of a foreign language. The applicant provided no evidence that he possessed skills that were not possessed by the general body of general practitioners in Australia sufficient to deal adequately with people from different ethnic backgrounds. It also noted that the applicant had seen multicultural patients for many years and that this was a long-standing feature of his practice rather than an exceptional occurrence on particular days. The number of these patients seen could have been addressed through practice strategies, as the applicant claimed to have done more recently. 85 PSRC 325 considered the applicant's claim that the fact that the 80/20 rule came into effect only a matter of days before the start of the referral period was an exceptional circumstance. It took the view that medical practitioners should have been aware of the relevant changes to the legislation prior to implementation. It referred to information provided by the Commission to each medical provider number holder in September 1999, detailing patterns of service that would constitute inappropriate practice for general practitioners. It referred to the fact that the medicare benefit schedule effective on 1 November 1999 detailed patterns of services relevant to general practitioners for professional services review purposes. It said that the applicant had acknowledged that he had read what was in the legislation but that he thought he had a good reason for exemption. PSRC 325 noted that the legislation affected all practitioners from the same date, and that the applicant was aware of the legislation prior to its commencement. It did not consider the temporal proximity of the introduction of the 80/20 rule to the start of the referral period to constitute an exceptional circumstance. 86 This examination of PSRC 325's approach to the issues raised by the applicant as exceptional circumstances makes it clear that, in this respect, PSRC 325's report was not tainted by any error of law. Even if it took the wrong view about the meaning of reg 11(b) of the 1999 Regulations (and I do not accept that it did), PSRC 325 still looked in detail at every circumstance put forward by the applicant as an exceptional circumstance. In the case of those which were on-going circumstances, PSRC 325 found first, in each case, that the circumstance was not exceptional for reasons other than its on-going nature, and added as an additional reason that the circumstance was of a long-standing nature. In other words, in each case, PSRC 325 found as a fact that the circumstances advanced were not exceptional without resort to its view that exceptional circumstances were most likely to be episodic or intermittent. Only when it had reached the conclusion that, for reasons other than this view, the circumstances concerned were not exceptional, did it then turn to the fact that the circumstances were not episodic or intermittent. In the case of each circumstance advanced, the findings of PSRC 325 were capable of standing quite apart from its view based on considerations of time. Those findings of fact cannot be overturned in this Court. They are not tainted by any error of law. 87 For all of these reasons, the applicant has failed to make out the second ground on which he sought to set aside the report of PSRC 325.

Procedural fairness 88 The applicant contended that, at the time he made the adjudicative referral, the Acting Director held the view that entry into an agreement pursuant to s 92 of the Health Insurance Act would not be possible unless the applicant requested such an agreement and was prepared to admit to having engaged in inappropriate practice. The Acting Director did not communicate this view to the applicant. In the applicant's contention, by failing to inform him of this view, the Acting Director denied him procedural fairness. 89 On the face of it, this contention appears to be utterly without foundation. As I have said, in ss 91, 92 and 93, the Health Insurance Act provides the Director with three options in dealing with an investigative referral: dismissal if there are insufficient grounds; entry into an agreement; and making an adjudicative referral. Section 88 requires the Commission to invite the person under review to make written submissions to the Director on why the Director should dismiss the investigative referral without taking the third option of making an adjudicative referral. It does not mention the second option. It does not require that the person under review be invited to make submissions about whether an agreement should be entered into. Section 94 requires the giving of reasons for a decision on an investigative referral if it is dismissed, or if an adjudicative referral is made. It requires no reasons if an agreement is entered into. It is difficult, if not impossible to discern from these provisions an obligation on the Director to initiate discussions about a possible agreement. If no such obligation exists, then any view held by the Director that he or she would not enter into negotiations about an agreement unless the medical practitioner were to make the first move would appear to be irrelevant. By s 92(1)(a), it is a necessary part of an agreement that the person under review acknowledge engaging in inappropriate practice during the referral period. Without such an acknowledgement, there can be no agreement. A view held by the Director that the medical practitioner would have to acknowledge having engaged in inappropriate practice, before an agreement could be entered into, would appear to be correct. Unless the medical practitioner indicated a preparedness to make such acknowledgement, there would seem to be little point in engaging in negotiations about an agreement. 90 Further, in the present case, there was no evidence that the Acting Director, who acted as the Director in dealing with the investigative referral, held the view alleged. In his letter of 20 January 2001, the Acting Director informed the applicant that the Acting Director had the option to enter into an agreement pursuant to s 92, but did not refer to the question of how negotiations might be initiated, or specifically to the need for preparedness to admit having engaged in inappropriate practice. The letter did not invite the applicant to address the point. None of these facts establishes that the Acting Director had any particular view. 91 In the absence of evidence, counsel for the applicant sought to rely on a finding of fact made by Ryan J in Daniel v Kelly. The Acting Director was the first respondent in that case, as he is in the present case. At [27], Ryan J set out the contents of an affidavit of the first respondent, in which he apparently said that, before making the adjudicative referral in that case, he considered whether it might be an appropriate case to enter into agreement with Dr Daniel under s 92. He did not consider it was an appropriate case to enter into an agreement. He did not receive any indication that Dr Daniel wished to enter into an agreement under s 92. No submissions were made by Dr Daniel in that respect. It was a precondition of an agreement that the person acknowledge conduct constituting inappropriate practice. The first respondent received no indication that Dr Daniel was prepared to make such an admission. At [28], Ryan J found that this evidence made it clear that the first respondent regarded it as a prerequisite for the exercise of his discretion that the person under review be prepared to concede guilt of inappropriate practice or otherwise invite the first respondent to resort to s 92. 92 Counsel in the present case sought to rely on that finding of fact, on the basis that the investigative and adjudicative referrals in respect of both Dr Daniel and the present applicant were made on the same dates, so it is highly likely that the Acting Director's approach to each was uniform. If this were not possible, counsel for the applicant sought production of the affidavit from the Daniel case, and leave to rely on it. 93 A finding of fact by a judge in one case is no precedent for another judge in another case. Even if the affidavit from the Daniel case were admitted into evidence in the present case, on the basis that it contained some kind of admission by the Acting Director as to his state of mind, with great respect to Ryan J, I am by no means sure that it would lead me to make the same finding of fact as his Honour made in Daniel. As I have already said, the Acting Director had no obligation to initiate negotiations for a s 92 agreement. The fact that he might have received no indication from the applicant that the applicant wished to enter into an agreement under s 92, or that the applicant made no submissions to that effect, does not mean that the Acting Director was of the view that he should refuse to consider a s 92 agreement unless the applicant proposed it. To say that it was a precondition of a s 92 agreement that the person under review acknowledge conduct constituting inappropriate practice was true in the sense that such an acknowledgement was an essential term of any agreement. In the absence of any indication that the applicant was prepared to make an admission of having engaged in inappropriate practice, there was no reason why the Acting Director should not take the view that he would not invite the making of such an admission. In any event, I do not regard it as necessary for me to pursue these factual issues, because the ground on which the applicant relied can be dealt with without making final decisions on them. 94 The applicant contended that Daniel v Kelly and Kelly v Daniel establish that it is necessary for the Director to advise a medical practitioner of any view that the Director holds, that it is up to the medical practitioner to initiate negotiations, and to acknowledge having engaged in inappropriate practice, before the Director will consider the possibility of a s 92 agreement. The question is whether those authorities sustain that proposition. The reasoning of Ryan J was summarised by the Full Court in Kelly v Daniel at [62] - [64] as follows: 'The primary judge found as a fact that the Acting Director regarded it as a prerequisite for the exercise of his discretion for the person under investigation to be prepared to concede guilt of inappropriate practice or otherwise invite the Director to resort to s 92. That construction of the section found no support in the statute. A s 92 agreement, logically, had to be considered before the Director made a referral to the Committee. The willingness of a practitioner to enter such an agreement might legitimately inform that decision. However, nothing in Dr Daniel's submission to the Acting Director indicated a refusal to acknowledge inappropriate practice, or that it would have made it pointless to consider a s 92 agreement. Rather, the submission suggested that Dr Daniel had seen the error of his ways and had accepted the need for counselling and further professional education in relation to the future conduct of his practice. His Honour went on to say that had the Acting Director thought that a refusal by Dr Daniel to make an admission would preclude entry into a s 92 agreement, that matter should, as a matter of procedural fairness, have been put to him to allow him to comment upon it. Similarly, if the Acting Director had proposed to treat as relevant the fact that Dr Daniel had not himself suggested a s 92 agreement, he should have afforded him an opportunity to explain his silence on the point. His Honour referred to Kioa v West (1985) 159 CLR 550. It did not appear to have been put to Dr Daniel that a failure to show contrition, or specifically invite recourse to s 92, would exclude him from an agreement under that section. His Honour found, accordingly, that Dr Daniel was denied procedural fairness in relation to the exercise of the Director's discretion under s 92. His Honour then set out relevant extracts from the adjudicative referral. He noted that the instrument was described as "a referral under s 106KA" and observed that this only tended to reinforce the conclusion that nothing more than cursory consideration was given to any issue beyond the 80/20 rule. This was despite the fact that Dr Daniel might have had a legitimate claim to an offer of a s 92 agreement, or some other favourable exercise of the Acting Director's discretion.' 95 The reasoning of the Full Court is found at [104] - [106]: 'The final issue raised on the appeal was whether the Director had denied Dr Daniel procedural fairness by making the adjudicative referral without affording him an opportunity to enter into an agreement under s 92. It is clear, as the primary judge concluded, that the Acting Director regarded it as a prerequisite for the exercise of his discretion for the person under investigation to be prepared to concede guilt of inappropriate practice or otherwise invite the Director to resort to s 92. Mrs Hampel submitted that, in the event that her primary submission regarding his limited role was rejected, the Acting Director acted correctly in approaching the section in that way.

We reject that submission. There is nothing in the language of the section to support that construction. Moreover, we agree with his Honour that if the Acting Director understood the section to operate in that way, he was under an obligation to afford Dr Daniel the opportunity to enter into such agreement. It follows that whether one characterises the Acting Director's approach to s 92 as involving a fundamental error of law going to jurisdiction, or whether it be characterised as a denial of procedural fairness, jurisdictional error has been demonstrated. The adjudicative referral could therefore have been set aside on this ground as well.' 96 The last sentence of this passage indicates that what the Full Court said was obiter. I do not regard the Full Court as having established a principle that, in every case, if the Director understands s 92 to operate on the basis that it is a prerequisite for the exercise of the Director's discretion to enter into a s 92 agreement for the person under investigation to be prepared to concede guilt of inappropriate practice or to invite the Director to resort to s 92, the Director has an obligation to afford the person under investigation the opportunity to enter into such agreement. Procedural fairness depends upon the circumstances of each case. An absolute rule of such particularity would be arbitrary. It may be that Ryan J and the Full Court came to the conclusions that they did in the Daniel cases because Dr Daniel had had previous dealings with the Commission, which appeared to have resolved the issues about the manner in which he conducted his practice, so that there were particular circumstances that suggested that the Acting Director should have pursued the question of a s 92 agreement in a more positive manner. The reference to Dr Daniel having seen the error of his ways, and being prepared to accept professional education, and to Dr Daniel's 'legitimate claim' to the offer of a s 92 agreement, tend to support this view. This is not to say that, in every case the Director is bound to present a medical practitioner whose conduct is under review with an explicit offer to enter into negotiations with a view to the making of such an agreement. 97 In Crowley v Holmes [2004] FCA 521, Sundberg J dismissed an application for interlocutory relief in respect of an alleged denial of procedural fairness, in which reliance was placed upon Daniel as authority for the principle that the Director was obliged to inform a medical practitioner under investigation of his view as to how negotiations for a s 92 agreement should be initiated, and as to the need for an acknowledgement of engaging in inappropriate practice. His Honour found that there was no serious question to be tried. In addition, in Oreb at [174] - [202], Jacobson J rejected the view that there was a denial of procedural fairness in circumstances similar to those in the present case. Subsequently, in Dimian v Health Insurance Commission [2004] FCA 1615 at [45], Selim v Lele [2005] FCA 24 at [30] and Lee v Kelly at [29] - [41], Jacobson J has taken the same view. I respectfully adopt the reasoning in those cases. 98 In the present case, the applicant knew that a s 92 agreement was an option. If he did not know it otherwise, he was so advised by the Director's letter dated 20 December 2001, informing him of the investigative referral and inviting him to make submissions as to why the Director should dismiss that referral, which letter accorded with s 88 of the Health Insurance Act. The applicant had legal advice at all times. His current solicitor has sworn an affidavit in which he says that he has received instructions from the applicant as to what he would have done if he had received notice from the Acting Director that the Acting Director would not consider entry into a s 92 agreement without an indication from the applicant that he was interested in entering into such agreement and a preparedness to admit inappropriate practice. He says that the applicant would have sought legal advice from his then solicitors and, on certain conditions, might have attempted to negotiate for an agreement. The applicant's current solicitor also details what advice he would have given to the applicant in those circumstances. The affidavit was admitted without objection and there was no cross-examination on it, but it is difficult to avoid the conclusion that there is a hefty element of hindsight in this evidence. There is no reason why the applicant could not have sought and received advice about his prospects of entering into a s 92 agreement. There is no reason why he could not have indicated to the Acting Director that he wished to negotiate in relation to such an agreement. To enter into such an agreement, the applicant would have had to be prepared to acknowledge that he had engaged in inappropriate practice. Instead, he chose to contest this issue. He could equally have chosen the negotiating path. Nothing that the Acting Director did or failed to do denied the applicant procedural fairness in this respect. 99 As I have said, this ground was raised at a late stage in the proceeding's history. The applicant would require an order pursuant to s 11(1)(c) of the ADJR Act, to give him the right to apply out of time in relation to the decision of the Acting Director to make an adjudicative referral. Because the applicant cannot succeed on that ground, there is no point in giving leave for him to raise it.

Conclusion 100 The applicant has therefore failed in respect of each of the three grounds he raised, or sought to raise, in relation to the report of PSRC 325. Because the grounds on which he proposed to attack the adjudicative referral of the Acting Director cannot be sustained, there is no occasion for enlarging the time limit to enable him to make an application to challenge that decision. His application must be dismissed. No reason was advanced, and none appears, for departing from the usual rule that costs follow the event. The applicant will therefore be ordered to pay the respondent's costs of the proceeding.

I certify that the preceding one-hundred (100) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Gray.

Counsel for the Respondents: FP Hampel SC with MD Murphy

Date of Hearing: 19, 20 October 2004