Yoong v Director, Professional Services Review

COLLIER J: 1 Before the Court is an originating application filed by the applicant, Dr Matthew Yoong, on 15 November 2021. The application seeks both interim and interlocutory orders and final orders. In respect of the final orders, the applicant seeks relief under the Administrative Decisions (Judicial Review) Act 1977 (Cth) (ADJR Act), being review of: a decision of the respondent made 21 May 2019 to issue a Notice to Produce Documents (dated 21 May 2019) pursuant to s 89B of the Health Insurance Act 1973 (Cth) (Health Insurance Act); and a decision of the respondent on or about 8 November 2021 pursuant to s 106ZPM of the Health Insurance Act that that section prevents Medicare benefits from being payable in respect of services rendered or initiated by the applicant. 2 The hearing yesterday morning was for interim and interlocutory orders only. 3 The parties have agreed on the following interim orders: 1. Director, Professional Services Review be substituted as the first respondent to the proceeding. 2. The second respondent be removed as a party to the proceeding. 3. […] 4. Pursuant to s.15(1) of the Administrative Decisions (Judicial Review) Act 1977 (Cth), the operation of the decision of the respondent of 8 November 2021 to fully disqualify the Applicant pursuant to s. 106ZPM of the Health Insurance Act 1973 (Cth) is suspended until final determination of this proceeding or other order of the Court. 5. The respondent forthwith give the Chief Executive Medicare written notice of the suspension of the disqualification of the Applicant pursuant to s. 106ZPM of the Health Insurance Act 1973 (Cth). 6. The Originating Application be adjourned for hearing with an estimate of 1 day on a date to be fixed. 7. The respondent is to file and serve the material before the respondent at the time of making each of the Decisions referred to in the Originating Application by 17 December 2021 or 14 days prior to the hearing, whichever is earlier. 8. The applicant is to file and serve a written outline of submissions 7 days prior to the hearing. 9. The respondent is to file and serve a written outline of submissions 3 days prior to hearing. 10. The solicitors for the applicant have leave to uplift the affidavit sworn by Michael Thomas Fletcher on 15 November 2021, remove page 113 from the annexure to it, and return the affidavit so altered to the registry. 11. Liberty be granted to all parties to apply on three days' notice or such shorter notice as a Judge might allow. 4 I understand that two matters remain in dispute. They are: (1) Whether the applicant should be required to give an undertaking as to damages in respect of these orders. (2) Whether the respondent's review of services of the applicant commenced on 30 April 2019 be suspended until the determination of this proceeding. 5 Both issues are pressed by the respondent, and opposed by the applicant. 6 Before turning to these issues it is helpful to briefly review the background facts.

Background 7 Dr Yoong is a general practitioner and Fellow of the Royal Australian College of General Practitioners. He has engaged in independent private practice in Brisbane since 1996 and has many regular patients with complex and chronic conditions which require ongoing management and review. 8 On 30 April 2019, the respondent decided to undertake a review of Dr Yoong's provision of services for the 12 month "review period" of 1 May 2017 to 30 April 2018 (Review Decision). 9 On 21 May 2019 the Director purported to issue a notice to Dr Yoong in connection with the Review Decision (Notice to Produce). The Notice to Produce was issued pursuant to s 89B of the Health Insurance Act, which permitted the respondent to issue a notice requiring production of "relevant documents", meaning: documents which are relevant to the review and includes clinical or practice records of services rendered or initiated during the review period… 10 The Notice to Produce required Dr Yoong to produce "complete clinical records for the patients identified on the attached list" within 3 weeks. The list contained 76 patients (nominated patients). 11 On 23 July 2019, the respondent purported to disqualify Dr Yoong from receiving Medicare benefits based on alleged non-compliance by Dr Yoong with the Notice to Produce (First Disqualification). 12 On 25 July 2019, pending a challenge to the Review Decision in the Federal Court, the Court made orders, inter alia: (a) setting aside the First Disqualification; and (b) staying the decision to issue the Notice to Produce. 13 These orders were made on undertakings given by Dr Yoong to: produce to his solicitors all documents in his possession the subject of the Notice to Produce within 7 days; and repay any Medicare benefits claimed in that 7 day period to the extent that, but for the order setting aside the First Disqualification, Medicare benefits would not have been available to Dr Yoong or his patients during that period. 14 Dr Yoong produced clinical records to his solicitors within 7 days. 15 Following the determination of the 2019 Proceeding on 21 September 2021, the documents produced by Dr Yoong to his solicitors were collected by the respondent on 27 September 2021. The documents comprised many thousands of pages of clinical records for medical services provided for the identified patients during the review period. 16 On 29 September 2021, a representative of the Professional Services Review (PSR) wrote to Dr Yoong's solicitors for the first time, expressing the view that: (a) the Notice to Produce required production of all historical records for each nominated patient, rather than records which related to services provided during the review period; and (b) if Dr Yoong had only produced records from the review period, then the Notice to Produce had not been complied with. 17 There followed a series of letters between Dr Yoong's solicitors and representatives of the PSR, including a letter by which the PSR purported to "narrow" the scope of the Notice to Produce to require production of all clinical records for the nominated patients for a seven year period from 1 May 2012 (five years before the review period) to 21 May 2019 (more than a year after the review period). 18 The correspondence culminated in a detailed letter from Dr Yoong's solicitors to the PSR on 8 November 2021, which outlined why Dr Yoong had complied with the Notice to Produce by supplying his clinical records relevant to the review. 19 On the same day, the Acting Director of the PSR, Dr David Rankin: (a) decided to issue a notice under s 106ZMP(2) of the Health Insurance Act notifying Dr Yoong that Dr Rankin had formed the view that Dr Yoong had intentionally failed to comply with the Notice to Produce, and as a result Medicare benefits would not payable to Dr Yoong (or his patients) in relation to any services rendered or initiated by Dr Yoong from midnight on 8 November 2021 (Disqualification Notice); and (b) wrote to the Chief Executive of Medicare under s 106ZPM(3) to notify her that the Disqualification Notice has been given, and to request that administrative steps be taken to prevent Dr Yoong (or his patients) accessing Medicare benefits. 20 Dr Rankin's decision has the effect that Dr Yoong is taken to be "fully disqualified" under s 19D of the Health Insurance Act and that Dr Yoong (and his patients) have no access to Medicare benefits. The effect of this decision is that Dr Yoong cannot reasonably and practicably continue to treat patients as a general practitioner. 21 On 16 November 2021, Dr Yoong filed an originating application seeking orders quashing or setting aside the decisions to issue the Notice to Produce and the Disqualification Notice. 22 I will now turn to the interlocutory issues presently in dispute between the parties.

1. Whether an undertaking as to damages should be required from Dr Yoong 23 In summary, the Director submitted: Her consent to the suspension of the decision made under s 106ZPM of the Health Insurance Act was provided on the basis that Dr Yoong provided the usual undertaking as to damages. A stay under s 15(1) of the ADJR Act is a form of interlocutory injunctive relief. It is well established that where interlocutory injunctive relief is granted, an undertaking is almost always required as a matter of course: see Century Metals and Mining NL and Another v Yeomans and Another (1988) 85 ALR 54 at 58; Mohamed (t/as Billan Family Day Care) v Secretary, Department of Education, Skills and Employment [2020] FCA 900 at [22]-[27]. In this regard the Director also noted the Court's Usual Undertaking as to Damages Practice Note (GPN-UNDR) which ordinarily requires an undertaking be given. The decision to issue a notice to produce documents under s 89B of the Health Insurance Act, which Dr Yoong challenged was made on 21 May 2019. This decision had already been the subject of challenge in a related proceeding before this Court. In those circumstances, the Director submitted that it was appropriate for Dr Yoong to provide the usual undertaking as to damages before the Court stayed the decision under s 106ZPM of the Health Insurance Act. 24 Counsel for Dr Yoong submitted, in summary: No similar undertaking was required by the Court in respect of a similar interlocutory suspension order in Kitchen v Director of Professional Service Review [2019] FCA 2022. An order under s 15 of the ADJR Act is not an equitable injunction in private litigation, but an order made in an administrative law context. In an administrative law context the starting point differs, as was made plain by French J in Century Mines at 58. Permitting Dr Yoong's patients to continue to access Medicare benefits for medical services provided to them until the final determination of this proceeding is not something which will cause any damage to the respondent (or the Commonwealth). If Dr Yoong is unsuccessful, the fact that his patients may have received Medicare benefits to which they would otherwise not be entitled does not mean that there is corresponding loss or damage to the respondent or the Commonwealth. 25 In my view no undertaking as to damages is required of Dr Yoong in the present circumstances. I so find for the following reasons. 26 First, the rationale for the Court ordering an undertaking as to damages in the context of interlocutory relief was explained by Gibbs J in Air Express Ltd v Ansett Transport Industries (Operations) Pty Ltd (1981) 146 CLR 249 at 311-312; [2018] HCA 75 as follows: The object of requiring a plaintiff who seeks an interlocutory injunction to enter into an undertaking of this kind is to attempt to ensure that a defendant will receive compensation for any loss which he suffers by reason of the grant of the injunction if it appears in the event that the plaintiff was not entitled to obtain it. The insistence upon the giving of an undertaking is a very important, if not an essential, means of preventing injustice from being done by the court when it makes an order at an interlocutory stage, before the rights of the parties have been finally determined. The court has a discretion not to enforce such an undertaking, but unless the defendant has been guilty of conduct that would render it inequitable to enforce the undertaking it would seem just, speaking generally, that a plaintiff who has failed on the merits should recompense the defendant for the damage that he has suffered as the result of the making of the interlocutory order. However, it is perfectly clear, and it appears from the words of the undertaking themselves, that the only damages to which a defendant is entitled are those which he has sustained by reason of the grant of the injunction. The generally accepted view is that the damages must be confined to loss which is the natural consequence of the injunction under the circumstances of which the party obtaining the injunction has notice… 27 (See also explanation of Lindgren J in Australian Competition and Consumer Commission v Giraffe World Australia Pty Ltd (1998) 84 FCR 512 at 537; [1998] FCA 819) 28 That this is a usual practice in the context of granting interlocutory injunctive relief is reflected in the Court's Usual Undertaking as to Damages Practice Note (GPN-UNDR). It is plain that the principle is of primary relevance to injunctive relief, rather than suspension of statutory decision-making powers. 29 Second, there have been decisions where undertakings as to damages have been required other than in the context of the grant of interlocutory injunctions: see for example Giraffe World (Mareva relief) and Mohamed (t/as Billan Family Day Care) v Secretary, Department of Education, Skills and Employment [2020] FCA 900 (stay pursuant to s 15 ADJR Act). However, there is authority that an undertaking is not generally required in circumstances where the proceedings before the parties are not private litigation between private parties for their own private purposes. Historically this was the position adopted by Lord Diplock in such cases as F Hoffman-La Roche & Co AG v Secretary of State for Trade and Industry [1975] AC 295 More recently in this Court I note the decision of Beach J in Australian Competition and Consumer Commission v Get Qualified Australia Pty Ltd (2016) 244 FCR 538; [2016] FCA 976, in particular where his Honour observed at [49]-[50] that the applicant, the Australian Competition and Consumer Commissioner (ACCC), was a Commonwealth regulator performing and exercising statutory functions and powers in the public interest and for the benefit of the public. Justice Beach in Get Qualified was subsequently followed by O'Bryan J in Australian Competition and Consumer Commission v Campbell [2019] FCA 886 at [41]-[42], where his Honour similarly did not require the ACCC to give an undertaking as to damages. 30 In such circumstances, it is not plain to me why a litigant seeking to suspend the operation of a statutory decision of a Commonwealth regulator should similarly not be required to give an undertaking as to damages to that regulator. 31 Third, the Director relies in particular on the decision of O'Bryan J in Mohamed (t/as Billan Family Day Care) v Secretary, Department of Education, Skills and Employment [2020] FCA 900 at [22]-[27] as supporting her application for an undertaking as to damages from Dr Yoong. In that case an applicant who conducted a family day care service had sought judicial review under the ADJR Act of a decision of the Department made under s 195H of the A New Tax System (Family Assistance) (Administration) Act 1999 (Cth). Relevantly the legislative scheme there contemplated: where it applied, a person whose child was in care could make a claim for a family tax benefit, however the payment of the benefit would be made to the child care service provider; and a child care service provider was required to be approved under that legislation in order for the subsidy to be paid to it and for the person whose child was in care to make a claim in respect of that service. 32 As O'Bryan J explained at [9], the key issue under consideration in Mohamed was the power of the Court, under s 15 of the ADJR Act, to order a stay of the relevant cancellation decision pending the completion of the internal review of that decision being conducted by the respondent. After examining relevant principles, his Honour refused to grant an interlocutory application insofar as it sought a stay in those terms. However, his Honour was prepared to stay the provider approval cancellation decision made by the respondent in respect of the applicant until final determination of the applicant's originating application for judicial review. 33 The next question however in that case was whether, in receiving the benefit of that stay, the Court should require an undertaking as to damages. Importantly the applicant before his Honour had proffered an undertaking as to damages in support of its application. His Honour referred to the decision of French J in Century Metals and Mining NL v Yeomans (1988) 85 ALR 54, in particular, where French J said at 58-59: The provisions of s 15 of course arise in a special statutory context whereby the subject is afforded an opportunity to seek review of official decisions adverse to it. There is in that statutory setting, a particular public interest in fair and lawful official decision-making. That, of course, is not a factor which concludes the debate against the requirement of an undertaking. There are many cases brought between private litigants under the Trade Practices Act 1974 (Cth) for example, which have public interest consequences. And so much has been recognised in such cases where interlocutory relief is granted notwithstanding delay… 34 His Honour further referred to the decision of Sheppard J in Botany Bay City Council v Minister of State for Transport & Regional Development (1996) 66 FCR 537; [1996] FCA 1507 where Sheppard J observed at [9]: Of course, in the area of administrative law considerations whether a party seeking interlocutory relief should be required to give an undertaking as to damages are not the same necessarily as apply where a party in what I may term private litigation sues and obtains an interlocutory injunction in order to preserve the status quo pending the Court determining the matter finally. In such cases an undertaking as to damages is usual. In the administrative law area there is no hard and fast rule and it may be that, if the [applicants] were entitled to interlocutory relief, it would not be appropriate to require such an undertaking. 35 Justice O'Bryan continued: 26. In the present case, the applicant seeks a stay of the respondent's cancellation decision pending a review of the decision. The effect of the stay is that the applicant will continue to hold an approval from the respondent, under s 195 of the Administration Act, to operate a Child Care Benefit Family Day Care Service. As such, individuals whose children are being provided with care at Billan Family Day Care will continue to be eligible for the applicable child care subsidies which will be paid to the applicant. 27. In my view, it is appropriate to grant a stay of the cancellation decision on the condition that the applicant gives the usual undertaking as to damages. If the applicant is unsuccessful in this proceeding, it will have been paid child care subsidies by the Commonwealth which, but for the stay, it would not have been entitled to receive. While the subsidies are due to the individuals whose children are provided with care at Billan Family Day Care, the subsidies are paid to the applicant and the applicant charges its clients lower hourly rates for its services. In my view it is appropriate, as a condition of the stay, that if the applicant is ultimately unsuccessful on its application for review under the ADJR Act, the applicant undertake to repay to the respondent the child care subsidies received in the period from 28 June 2020. I note that such undertakings were given in the same context in each of Galaxy and Azaria. 36 In my view however the decision before me is not on all fours with that in Mohamed. A particular and crucial distinction is that in Mohamed not only had the applicant there offered the undertaking, but under the relevant legislative scheme the relevant child care subsidy was paid directly to the child care centre applicant, whereas in the present case the Medicare levy travels with the relevant patient rather than the doctor. Accordingly, a child care centre with children enrolled would presumably be entitled to the relevant subsidy, whereas if patients of Dr Yoong did not see him but rather attended another general practitioner Dr Yoong would receive no benefit from the Commonwealth. 37 Further, I am not persuaded that the authorities of Century Metals and Botany Bay City Council necessarily support the proposition that an undertaking as to damages is required in the present circumstances. Both Sheppard J and French J severely qualified their support for this proposition in the passages quoted earlier. 38 I note in conclusion that the decision in Kitchen on which the applicant relied is of little assistance, where plainly in that case the Director did not seek an undertaking as to damages (see [61] of Kitchen). Ultimately, however, in the present case I am not persuaded that either the Director or the Commonwealth would suffer "damages" for "loss" in respect of Dr Yoong's activities, warranting an undertaking to protect the Director or Commonwealth in the terms the Director has claimed. Accordingly, an undertaking to that effect is not necessary or appropriate.

2. Whether the respondent's review of services of the applicant commenced on 30 April 2019 be suspended until the determination of this proceeding 39 In relation to the need for a stay of the review, the respondent submitted, in summary: The Director seeks an order suspending her review of Dr Yoong's provision of services so that she is not prejudiced in the conduct of the review by the effluxion of time while Dr Yoong's originating application is resolved. Section 94 of the Health Insurance Act provides that if, after a period of 12 months after making a decision to review the provision of services by a person, the Director has not made one of the decisions listed in s 94(1)(b)(i)-(iii), she is deemed to have made a decision to take no further action in relation to the review. There are limited circumstances in which this 12 month statutory timeframe can be extended. Section 94(2) provides that if the review is suspended because of an injunction or other court order, the Director has power to extend the period of 12 months by a period no longer than the period of the suspension. In circumstances where Dr Yoong's requirement to provide records will necessarily be suspended by operation of the interlocutory orders proposed to be made, it is appropriate for the Court to exercise the power to suspend the review pending the determination of this proceeding. 40 In summary, Dr Yoong submitted: The legislature saw fit to deal with circumstances where a review is suspended by Court order under s 94(2) of the Health Insurance Act by the machinery in s 94(3) of the Act. If Dr Yoong vindicates his claim concerning the documents he delivered to the Director, a suspension of the review by the Director at this point will mean that Dr Yoong will not obtain the full value of the judgment, but rather will have the matter hanging over his head for another year while the review continues. This is of particular relevance because the Director's case is very weak. 41 The relevant statutory provisions in respect of this issue are ss 94 and 89B of the Health Insurance Act. 42 Section 94 provides: Director taken to have made a decision after 12 months (1) If: (a) the Director decides to review the provision of services by a person; and (b) before the end of the period of 12 months after making the decision, the Director has not: (i) made a decision under section 91 to take no further action in relation to the review; or (ii) entered into an agreement with the person under section 92 (whether or not the agreement has been ratified by the Determining Authority); or (iii) referred the provision of one or more of the services to a Committee; then, the Director is taken to have made a decision at the end of that period to take no further action in relation to the review. Note: Sections 92A and 106R set out time limits for the ratification of agreements made under section 92. (2) If the review is suspended: (a) under paragraph 89A(2)(b); or (b) because of an injunction or other court order; the Director may determine, in writing, that the period of 12 months referred to in subsection (1) is extended by a specified period that is not longer than the period of the suspension. (3) If a notice is given under subsection 89B(2) to the person under review, or to another person, and the person concerned fails to comply with a requirement of the notice, the Director may determine, in writing, that the period of 12 months referred to in subsection (1) is extended by a specified period that is not longer than the period during which the person fails to comply with the requirement. (4) This section does not apply in relation to a review undertaken because of section 89. 43 Section 89B provides: Power of Director to require the production of documents or the giving of information (1) In this section: "relevant documents" means documents that are relevant to the review and includes clinical or practice records of services rendered or initiated during the review period by: (a) the person under review; or (b) a practitioner employed or otherwise engaged by the person under review; or (c) a practitioner employed or otherwise engaged by a body corporate of which the person under review is an officer. (2) For the purpose of undertaking a review, the Director may, by written notice given to: (a) the person under review; or (b) any other person whom the Director believes to have possession, custody or control of, or to be able to obtain, relevant documents; require the person to whom the notice is given: (c) to produce to the Director, or to a person nominated by the Director, such relevant documents as are referred to in the notice; and (d) if the person does not have possession, custody or control of, and cannot obtain, any of those documents: (i) to inform the Director or a person nominated by the Director of that fact; and (ii) if the person knows, or can readily find out, the name and address of a person who has possession, custody or control of, or can obtain, any of the documents--to give that name and address to the Director or to a person nominated by the Director. (3) The notice must state: (a) the period within which, and the place at which, the documents are to be produced; and (b) the period within which a name and address referred to in subparagraph (2)(d)(ii) are to be given. (4) The period to be stated in the notice must be a period ending at least 14 days after the day on which the notice is given. (5) The notice is to set out the terms of section 106ZPM or 106ZPN, whichever is applicable to contraventions of the notice. However, a failure to comply with this subsection does not affect the validity of the notice. (6) If a document is produced in response to the notice, the Director or a person nominated by the Director: (a) may inspect the document; and (b) may retain the document in his or her possession for such reasonable period as he or she thinks fit; and (c) may make copies of, or take extracts from, the document. 44 In my view it is appropriate to make the suspension order sought by the Director. 45 First, I accept the proposition advanced by the Director that, in the absence of a suspension, the Director stands at risk of a decision being made by default pursuant to s 94(1) of the Health Insurance Act. Section 94(1) imposes a strict time limit of 12 months after the making of the relevant decision, following which the Director is taken to have made a decision to take no further action in relation to the review. 46 Second, s 94(2)(b) clearly contemplates suspension of a review by Court order. In my view it is this section which creates the critical legislative machinery permitting the rights of the Director to remain intact while a challenge to a decision of the Director takes place. 47 In this context I also note the purpose of Part VAA of the Health Insurance Act, as set out in s 79A of the Act. Specifically: Object of this Part The object of this Part is to protect the integrity of the Commonwealth medicare benefits, dental benefits and pharmaceutical benefits programs and, in doing so: (a) protect patients and the community in general from the risks associated with inappropriate practice; and (b) protect the Commonwealth from having to meet the cost of services provided as a result of inappropriate practice. 48 Under s 83 of the Health Insurance Act (which falls in Part VAA), the Director has such functions, duties and powers as are conferred on him or her by this Part or the regulations. 49 Plainly s 94(2)(b), by permitting a suspension of a review by Court order, is enacted for the benefit of the Director, and to facilitate the performance of the statutory functions, duties and powers of the Director in circumstances of a challenge to a review decision. 50 Third, I note the submission of Dr Yoong that the case of the Director against him is weak, and further that, if the Court suspends the review but he is successful in his claim, he will not obtain the full value of the judgment once the review recommences following the end of the suspension. That may well be the case, however the fact that s 94(2)(b) specifically empowers the Court to suspend a review decision means, in my view, that such circumstances as Dr Yoong describes (referable to his non-receipt of the full value of any judgment) are nonetheless contemplated by that power to suspend. I do not consider that the submission of Dr Yoong warrants a refusal by the Court to refuse to exercise its suspension power under s 94(2)(b) of the Health Insurance Act. I am also not prepared at this interlocutory stage to comment on the weakness or otherwise of the Director's case. 51 Finally, I do not accept the applicant's proposition that the legislature saw fit to deal with circumstances where a review is suspended by Court order under s 94(2) of the Health Insurance Act, by the machinery in s 94(3) of the Health Insurance Act. Section 94(3) deals specifically with circumstances where a notice is given under s 89B(2) and the person fails to comply with a requirement of the notice. Section 94(3) is potentially applicable to Dr Yoong's circumstances because of the nature of the non-compliance alleged on his part by the Director. However, ss 94(2) and 94(3) appear to have different work to do. Section 94(2) permits suspension of a review decision, whereas s 94(3) is much more specific and related to notices given under s 89B(2). I am not persuaded at this interlocutory stage that where a notice is given under s 89B(2), the Court is somehow limited in its power to suspend a review decision under s 94(2).

Conclusion 52 For the reasons I have given I am not satisfied that an undertaking by the applicant as to damages is required in this case. I further consider that the respondent's review of services of the applicant commenced on 30 April 2019 should be suspended until determination of this proceeding. It is my understanding from the submissions of the parties that they otherwise accept as appropriate the orders I set out in paragraph 3 of these reasons, and I make those orders accordingly. I certify that the preceding fifty-two (52) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Collier.