Oreb v Willcock [2005] FCAFC 196 (16 September 2005)

Last Updated: 16 September 2005

FEDERAL COURT OF AUSTRALIA

Oreb v Willcock [2005] FCAFC 196

ADMINISTRATIVE LAW – Health insurance – Investigation by Professional Services Review Committee as to whether a medical practitioner has engaged in inappropriate practice in relation to the number of services rendered or initiated by him – Whether Health Insurance Commission was entitled to make an investigative referral to the Director of Professional Services Review simply upon evidence that the appellant had rendered or initiated 80 or more services on more than 20 days in a 12 month period – Whether Director failed to have regard to s 92 of the Health Insurance Act in referring the appellant’s conduct to an investigative committee – Meaning of ‘exceptional circumstances’ – Whether considerations of practice management are relevant to the application of reg 11 of the Health Insurance (Professional Services Review) Regulations – Whether matter should be remitted to a different committee.


Health Insurance Act 1973 (Cth) ss 82, 86, 92, 106KA(2)

Health Insurance (Professional Services Review) Regulations 1999 (Cth) regs 10, 11





Oreb v Willcock [2004] FCA 1520










ZELCO FRANCIS OREB v SIMON WILLCOCK, ELIZABETH MAGASSY AND ROD McMAHON constituting the Professional Services Review Committee No 298, THE DETERMINING AUTHORITY established by section 106Q of the Health Insurance Act 1973 (Cth), HEALTH INSURANCE COMMISSION, ALAN JOHN HOLMES in his capacity as Director of Professional Services Review
NSD 1951 of 2004



BLACK CJ, WILCOX and LANDER JJ
16 SEPTEMBER 2005
SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NSD 1951 of 2004

ON APPEAL FROM A SINGLE JUDGE OF THE FEDERAL COURT OF AUSTRALIA

BETWEEN:	ZELCO FRANCIS OREB APPELLANT
AND:	SIMON WILLCOCK, ELIZABETH MAGASSY AND ROD McMAHON constituting the Professional Services Review Committee No 298 FIRST RESPONDENT THE DETERMINING AUTHORITY established by Section 106Q of the Health Insurance Act 1973 (Cth) SECOND RESPONDENT HEALTH INSURANCE COMMISSION THIRD RESPONDENT ALAN JOHN HOLMES in his capacity as Director of Professional Services Review FOURTH RESPONDENT
JUDGES:	BLACK CJ, WILCOX and LANDER JJ
DATE OF ORDER:	16 SEPTEMBER 2005
WHERE MADE:	SYDNEY

THE COURT ORDERS THAT:

1. The appeal be dismissed.
2. The cross-appeal be allowed.
3. Paragraph 2 of the orders made by Jacobson J on 30 November 2004 and paragraph 1 of the orders made on 29 April 2005 be set aside.
4. In lieu thereof, there be an order that:
‘The matter be remitted to the first respondent to determine Adjudicative Referral No. 298 according to law.’

5.	The question of the costs of the appeal and cross-appeal be reserved.

6. Liberty to the parties to apply in relation to costs in accordance with the directions in Lander J’s reasons.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NSD 1951 of 2004

ON APPEAL FROM A SINGLE JUDGE OF THE FEDERAL COURT OF AUSTRALIA

BETWEEN:	ZELCO FRANCIS OREB APPLICANT
AND:	SIMON WILLCOCK, ELIZABETH MAGASSY AND ROD MCMAHON constituting the Professional Services Review Committee No 298 FIRST RESPONDENT THE DETERMINING AUTHORITY established by Section 106Q of the Health Insurance Act 1973 (Cth) SECOND RESPONDENT HEALTH INSURANCE COMMISSION THIRD RESPONDENT ALAN JOHN HOLMES in his capacity as Director of Professional Services Review FOURTH RESPONDENT

JUDGES:	BLACK CJ, WILCOX and LANDER JJ
DATE:	16 SEPTEMBER 2005
PLACE:	SYDNEY

REASONS FOR JUDGMENT

BLACK CJ AND WILCOX J:

1 We have had the advantage of reading in draft form the reasons for judgment of Lander J. We agree with his Honour that Dr Oreb’s appeal should be dismissed, and for the reasons given by Lander J.

2 We also agree with Lander J that the cross-appeal should be dismissed, to the extent that it challenges the order of Jacobson J setting aside the decision of Professional Services Review Committee No 298, but that it should be allowed to the extent that his Honour’s order requires reconsideration of the case by a differently constituted Committee. We agree with Lander J that the circumstances of this case do not require reconstitution of the Committee.

3 The former point raises a matter of substance, which has apparently caused problems for several Professional Services Review Committees. That being so, it seems desirable for us to express, in our own words, our views about the relationship between s 106KA of the Health Insurance Act 1973 (Cth) (‘the Act’) and regs 10 and 11 of the Health Insurance (Professional Services Review) Regulations (1999) (Cth).

4 As Lander J points out, the ultimate question is whether the practitioner has engaged in ‘inappropriate practice’. Section 106KA(1) provides that a practitioner shall be taken to have engaged in inappropriate practice ‘if, during a particular period ... the circumstances in which some or all of the referred services were rendered or initiated constituted a prescribed pattern of services’. Regulation 10 makes it such a circumstance ‘that 80 or more [professional attendances] are rendered on each of 20 or more days in a 12 month period’. Therefore, proof of the fact that the particular practitioner has rendered such attendances is prima facie evidence that the practitioner has engaged in inappropriate practice and is vulnerable to disciplinary action under the Act.

5 However, s 106KA(2) qualifies this prima facie position by providing that, if the person under review satisfies the relevant Professional Services Review Committee that, on a particular day or days during the relevant period, exceptional circumstances existed that affected his or her rendering or initiating services, then the person is not to be taken as having engaged in inappropriate practice in providing services on those days.

6 As Lander J observes, the term ‘exceptional circumstances’ is not defined by the Act. However, it is clear that ‘exceptional circumstances’, within the meaning of the Act, may be established in either of two ways. First, a person under review may argue the existence of circumstances that are ‘exceptional’, in the ordinary English meaning of that word, and that may have nothing to do with the terms of reg 11. If so, it will be for the Committee to determine whether the relevant circumstances are truly exceptional, having regard to the usual operation of a practice of the kind conducted by the person under review. In the case of a general medical practitioner, as here, the touchstone will be the circumstances ordinarily faced by general practitioners.

7 If the Committee finds in favour of the practitioner on this issue, in respect of a particular day or days during the period specified in the Commission’s notice, then the next question for the Committee to determine will be whether those circumstances ‘affected the rendering or initiating of services by the person’. There must be a causal connection between the existence of the circumstances and the provision of the services. We agree with Lander J, however, that the identified circumstances need not be the sole, or even dominant, cause of the provision of the services.

8 Second, a person under review may rely on reg 11. That regulation itself provides two alternatives, paras (a) and (b). Those paragraphs are as follows:

‘(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.’

9 If either paragraph is demonstrated to apply, that is enough to establish ‘exceptional circumstances’ for the purposes of the Act. This is because the chapeau to reg 11 declares that the circumstances set out in those paragraphs ‘constitute exceptional circumstances’. It is immaterial whether or not they are exceptional, in the ordinary meaning of that word. Whether or not they are in fact exceptional to the ordinary experience of other practitioners, they are deemed to be exceptional for the purposes of s 106KA of the Act.

10 Of course, if the requirement of either para (a) or para (b) is made out, it remains necessary for the practitioner to establish a causal connection (in the sense explained above) between the established circumstances and the provision of the relevant services.

11 In his submissions to the Committee, Dr Oreb did not specify whether he was relying on exceptional circumstances, in the ordinary meaning of that term, or reg 11 or both. Certainly, he did not rely on para (a) of reg 11. Accordingly, it is possible to pass over that paragraph. However, he may have relied on para (b) of reg 11. Therefore, we should indicate our view of its proper construction.

12 With respect, we do not agree with Lander J that placita (i) and (ii) state criteria to be satisfied before it can be concluded that para (b) applies. These placita specify matters to be considered by the Committee in forming a judgment whether there was ‘an absence of other medical services’ and, if so, whether there was a causal connection between that absence and the provision of the services. In our view, the list of matters to which regard is to be had in forming a judgment about whether there was an ‘absence of other medical services’ should not be interpreted as involving a requirement that each matter be present. That would be to read the words ‘having regard to’ as ‘because of" and to read the list of matters as being reasons for forming that judgment rather than as matters to be considered. In addition, it seems to us that there is no complementarity between the two placita; there is no apparent reason why they should both need to be present. It is not difficult to conceive how each matter, separately, advances the policy underlying the provision. The absence of other medical services may conceivably be solely a function of location; for example, the practitioner may be the only practitioner in a remote location. The patients in such a place may have no particular ‘characteristics’ at all, other than that they live in that location. The absence may also, however, be very much a function of the characteristics of the patients; for example, the person under review might service patients who suffer from an unusual medical condition in relation to which the alternative available practitioners do not have the requisite capabilities.

13 As we have said, it is not clear upon what basis Dr Oreb put his case to the Committee. To the extent that he relied on the ordinary English meaning of the term ‘exceptional circumstances’, it seems to us the Committee adequately addressed the points made in his submission and answered them in a legally unexceptional way. As we read the Committee’s report, it expressed the qualified view that ‘"exceptional circumstances" were seen as most likely to be of an intermittent or episodic nature’ and did accept that ‘some extreme on-going circumstance’ may be an exceptional circumstance. It was for the Committee to determine the facts of the case, including whether the circumstances advanced by Dr Oreb should be regarded as exceptional, having regard to the usual operation of a general practitioner’s practice. In making that determination, the Committee might be required to consider whether particular circumstances were foreseeable or avoidable. In relation to this type of case, there is room for consideration of the way in which a particular practice is managed.

14 However, to the extent that Dr Oreb may have relied on reg 11(b), we agree with Lander J that concepts of foreseeability and avoidance were immaterial. So is practice management. The only relevant question was whether there was an absence of other medical services, having regard to the location of Dr Oreb’s practice (Newtown) and the characteristics of his patients (predominantly people with a connection to the former Republic of Yugoslavia).

15 Dr Oreb’s submission did not specifically address the terms of reg 11(b). On one view of the matter, it failed to raise material that would have entitled the Committee to find an absence of other medical services for his patients in the period under review. However, the matters raised by Dr Oreb (if factually correct) might arguably support the inference that there was such an absence. That being so, the possible application of reg 11(b) needed to have been addressed by the Committee in terms, and in reasoning that was free of consideration (irrelevant in the context of reg 11) of patient management measures that might have been available and desirable.

16 Other matters considered by the Committee (patient demand, the special mental and health care needs of Dr Oreb’s patients, inability to attract/retain additional resources in the practice and Dr Oreb’s work pattern) were, we think, relevant to reg 11. Dr Oreb’s linguistic ability to deal with patients was arguably relevant to reg 11(b), although only if it was demonstrated there was an absence of satisfactory interpretation services. However, whether or not Dr Oreb could have better organised his practice was irrelevant. The focus of reg 11 is the need of the patients, not the management skills of practitioners.

17 To the extent that the Committee must be regarded as having examined the issue arising under reg 11(b), it took into account an irrelevant circumstance: practice management measures. If the Committee must be regarded as having failed to consider reg 11(b), it ought to have done so. On either basis, the omission vitiated its decision. We agree with Lander J that the matter ought to be remitted to the Committee for further consideration and determination.

18 We agree with the orders proposed by Lander J.

I certify that the preceding eighteen (18) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Chief Justice Black and Justice Wilcox .

Associate:

Dated: 16 September 2005

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NSD1951 OF 2004

ON APPEAL FROM A SINGLE JUDGE OF THE FEDERAL COURT OF AUSTRALIA

BETWEEN:	ZELCO FRANCIS OREB APPELLANT
AND:	SIMON WILLCOCK, ELIZABETH MAGASSY AND ROD MCMAHON constituting the Professional Services Review Committee No 298 FIRST RESPONDENTS THE DETERMINING AUTHORITY established by Section 106Q of the Health Insurance Act 1973 (Cth) SECOND RESPONDENT HEALTH INSURANCE COMMISSION THIRD RESPONDENT ALAN JOHN HOLMES in his capacity as Director of Professional Services Review FOURTH RESPONDENT

JUDGES:	BLACK CJ, WILCOX AND LANDER JJ
DATE:	16 SEPTEMBER 2005
PLACE:	SYDNEY

REASONS FOR JUDGMENT

LANDER J:

19 This is an appeal and cross-appeal from orders made by a judge of this Court in proceedings brought by the appellant pursuant to s 5 and s 6 of the Administrative Decisions (Judicial Review) Act 1977 (Cth) and s 39B(1A) of the Judiciary Act 1903 (Cth) to review decisions made under the Health Insurance Act 1973 (Cth) (the Act).

20 The orders were interlocutory in that they did not finally dispose of all issues between the parties. Discrete issues were considered. Leave to appeal was granted by Gyles J on 17 December 2004.

21 The appellant sought a judicial review of three separate decisions. First, a decision of the third respondent made on or about 13 December 2001 to make an investigative referral under s 86 of the Act to the fourth respondent in respect of conduct of the appellant. Secondly, a decision of the fourth respondent made on or about 5 March 2002 to set up a Committee comprising the first respondents and to make an adjudicative referral to them under s 93 of the Act in respect of the appellant’s conduct. Thirdly, a decision of the first respondents in providing a final report to the second respondent dated 8 November 2002 regarding the appellant’s conduct.

22 The appellant sought orders quashing all three decisions. The appellant succeeded in part. He failed in his application to have the decisions made by the third and fourth respondents quashed. He succeeded in having the decision made by the first respondents set aside.

23 On 30 November 2004 the primary judge made the following orders:

‘1. The findings of Committee 298 that Dr Oreb had engaged in inappropriate practice and that exceptional circumstances did not exist, be set aside.

2. The matter be referred back to the Director of Professional Services Review to consider whether it is appropriate to establish a differently constituted committee to determine, in accordance with law, whether Dr Oreb engaged in inappropriate practice during the referral period.

3. Brief argument on costs be heard in the week of 6 December 2004.’

24 On 5 April 2005 the respondents, by Notice of Motion, sought the following:

‘1. That order 2 made by his Honour Justice Jacobson on 30 November 2004 (order 2) be varied as follows:

The matter be remitted to the First Respondents for determination of Adjudicative Referral No 298 according to law.

2. Alternatively, that order 2 be varied as follows:

The matter be remitted to the Director of Professional Services Review with a direction that the Director of Professional Services Review amend Adjudicative Referral No 298 so as to re-constitute the membership of the Committee that is to determine the adjudicative referral made on 5 March 2002 according to law.

3. That the costs of this motion be costs in the appeal from the judgment of his Honour Justice Jacobson given on 30 November 2004.’

25 The Notice of Motion was supported by an affidavit of the respondent’s solicitor in which, after referring to the orders made by the primary judge on 30 November 2004, he deposed:

‘4. For the following reasons, the Respondents respectfully submit that order 2 made by his Honour may not reflect the intention of the Court, and the Respondents seek the orders set out in the Notice of Motion filed herein, pursuant to the Court’s powers under Order 35, rule 7(2) of the Federal Court Rules.

4.1 In the absence of order 2, the First Respondents would remain under a duty to determine Adjudicative Referral No 298, their purported determination of that referral having been found by his Honour to be vitiated by jurisdictional error.

4.2 His Honour did not suggest, in the Reasons for Judgment, that there was any reason why the First Respondents might be disabled from discharging that duty or why it might be desirable in the interests of justice that the First Respondents not discharge that duty.

4.3 Order 2 is capable of being read as imposing no constraint on the Director of Professional Services Review to vary the composition of the Committee presently constituted by the First Respondents, but simply requiring the Director to consider that possibility. If that is the correct reading of order 2, it is not apparent why the matter has been referred back to the Director.

4.4 On the other hand, if his Honour intended to constrain the Director and to require, if Adjudicative Referral No 298 is to proceed, that the adjudicative referral be determined by a differently constituted Committee, it is respectfully submitted that:

(a) order 2 does not effect such a constraint and

(b) his Honour’s reasons do not indicate the basis for such a constraint.’

26 The primary judge’s associate sent an e-mail to the parties’ solicitors in the following terms:

‘Dear Ms Window and Mr Wade,

Oreb, Lee and Lee

I refer to an email from Ms Window of even date enquiring whether the Notices of Motion in the abovenamed matters will actually be heard tomorrow as opposed to being a directions hearing.

I note that these motions were listed ‘for directions only’ tomorrow, however His Honour wishes to draw parties’ attention to the recent orders made by Kiefel J in Hatcher v Cohn, that:

"Order 3 made by her Honour Justice Kiefel on 30 November 2004 be varied as follows:

The matter be remitted to the Director of Professional Services Review with a direction to amend Adjudicative Referral 297 so as to reconstitute the membership of the Committee that is to determine the adjudicative referral made on 21 February 2002 according to law."

His Honour wonders why orders should not be made in similar terms in relation to the present the notices of motion.’

27 On 28 April 2005 the parties’ solicitors signed a document which included ‘consent orders’ which was forwarded to the primary judge’s associate.

28 As a result, on 29 April 2005, the following orders in the same terms of the consent orders signed by the parties were entered by the primary judge:

‘1. The matter be remitted to the Director of Professional Services Review with a direction that the Director of Professional Services Review amend Adjudicative Referral No 298 and establish a differently constituted Committee that is to determine the adjudicative referral made on 5 March 2002 according to law.

2. That the costs of this motion be costs in the appeal from the judgment of his Honour, Justice Jacobson, given on 30 November 2004.’

29 Although it does not say so, paragraph 2 of the order made on 29 April 2005 no doubt was intended to take effect in lieu of paragraph 2 of the orders of 30 November 2004.

30 I have referred to the history of the variations to his Honour’s order of 30 November 2004 because it became a live issue on this appeal.

31 The appellant is a medical practitioner who is in general practice. Part VAA of the Act establishes the Professional Services Review Scheme under which a general practitioner’s conduct (and other practitioner’s conduct) can be examined to ascertain whether that practitioner has been involved in inappropriate practice and for action in response to any finding of inappropriate practice: s 80(1). Part VAA was introduced in its present form by the Health Insurance Amendment (Professional Services Review) Act 1999 (Cth).

32 The third respondent (the Commission) is a statutory body established under the Health Insurance Commission Act 1973 (Cth) which has the responsibility of performing the functions provided for in s 5 of the Health Insurance Commission Act and the further functions provided for in the Act.

33 Section 83 of the Act empowers the Minister to appoint a medical practitioner to be the Director of Professional Services Review (the Director). The fourth respondent is that person.

34 The Commission is empowered under s 86 to refer to the Director the conduct of a person relating to whether the person has engaged in inappropriate practice in connection with the rendering of services or initiation of services: s 86(1). Such a referral is referred to in the Act as an investigative referral: s 86(2).

35 The Director, if such an investigative referral is made, has the responsibility of investigating that referral: s 89. The Director is given powers under the Act to facilitate that investigation: s 89B.

36 Section 84 of the Act establishes a Professional Services Review Panel. It consists of practitioners appointed by the Minister. ‘Practitioners’ is defined in s 81 of the Act and includes medical practitioners, dental practitioners, optometrists, chiropractors, physiotherapists and podiatrists.

37 The Minister must consult with the Australian Medical Association Ltd (ACN 008 426 793) (AMA) before appointing any medical practitioner to the panel: s 84(3). A medical practitioner who is appointed to the Panel becomes a ‘Panel member’: s 81. In conducting his/her investigation, the Director is entitled to consult a Panel member or any consultant that the Director considers appropriate: s 90. The Director may, in discharging his or her duty to make a decision on the investigative referral, do one of five things.

38 First, the Director may, if the Director thinks that the person under review may have committed an offence that is a relevant offence within the meaning of s 124B, send the matter to the Commission: s 89A(1). If the Director does so, the Director can either continue or suspend the investigation: s 89A(2).

39 Secondly, the Director may dismiss the investigative referral if the Director is satisfied that there are insufficient grounds on which a Professional Services Review Committee could reasonably find that the person under review has engaged in inappropriate practice: s 91. The first respondents are the members of Professional Services Review Committee No 298. I shall refer to the statutory basis which constitutes the Professional Services Review Committee shortly.

40 Thirdly, if the person under review is a practitioner, as defined in s 81 of the Act, the Director and that person may enter into a written agreement in respect of the matters which have been referred to the Director under s 86. That written agreement must include an acknowledgement by the person under review that he or she has engaged in inappropriate practice and specify the action in relation to that person. The action which may be specified is provided for in s 92(2) of the Act which provides:

‘(2) The action that may be specified under paragraph (1)(b) in the agreement includes any one or more of the following:

(a) that the Director, or the Director’s nominee, is to reprimand the person;

(b) if any medicare benefit has been paid (whether or not to the person) for services referred to in paragraph (1)(a)--that the person is to repay to the Commonwealth an amount equal to the whole or a specified part of that medicare benefit;

(c) that any medicare benefit that would otherwise be payable for services referred to in paragraph (1)(a) is to cease to be payable;

(d) if the person is a participating optometrist--that the Minister’s acceptance of the undertaking by the participating optometrist under section 23B is to be taken to be revoked, either wholly or in so far as the undertaking covers particular premises;

(e) if the person is a medical practitioner or a dental practitioner in respect of whom a Part VII authority is in force and a service referred to in that paragraph involves prescribing or dispensing a pharmaceutical benefit--that the Part VII authority is to be taken, for the purposes of the National Health Act 1953, to be revoked or suspended;

(f) that the person is to be disqualified, for a specified period of not more than 3 years starting when the agreement takes effect, in respect of one or more of the following:

(i) provision of specified services, or provision of services other than specified services;

(ii) provision of services to a specified class of persons, or provision of services to persons other than persons included in a specified class of persons;

(iii) provision of services within a specified location, or provision of services otherwise than in a specified location;

(g) that the person is to be fully disqualified for a specified period of not more than 3 years starting when the agreement takes effect.’

41 Any agreement entered into by the Director and the person under review under s 92 of the Act is not to take effect until it has been ratified by the Determining Authority.

42 The Determining Authority, which on this appeal is the second respondent, is constituted by s 106Q of the Act. One of its responsibilities is to consider and ratify agreements made under s 92 of the Act. It has other responsibilities which I shall describe shortly.

43 If the agreement is ratified by the Determining Authority the agreement takes effect on the date specified in the agreement and the agreement becomes binding on the Director and the person under review: s 92(4).

44 Fourthly, the Director may set up a Committee and make an adjudicative referral to that Committee. The Committee is constituted as the Professional Services Review Committee under s 95 of the Act. The Committee consists of a Chairperson who is a Deputy Director and two other panel members, who have been appointed to the Professional Services Review Panel under s 84 of the Act.

45 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: s 95(2). Moreover, they must, if the practitioner was a consultant physician in a particular specialty be consultant physicians in the same specialty or, if the practitioner is a specialist be a specialist in the same specialty: s 95(3) and (4). If the practitioner was at that time a general practitioner the other panel members, apart from the Chairperson, must also be general practitioners: s 95(5).

46 If the Director sets up a Committee under s 93 of the Act the Committee must convene the first meeting of the Committee within 14 days after its appointment: s 97. It then must conduct itself in accordance with the provisions of Subdivision B of Division 4 of Part VAA of the Act.

47 Fifthly, the Director may take no action in respect of the investigative referral: s 93A. In certain circumstances, the Director is deemed to have taken no action: s 93A(2). The Director’s decision to take no action is subject to the qualification mentioned in s 93B but that qualification is not relevant on this appeal.

48 Section 82 of the Act defines ‘inappropriate practice’. The appellant is a general practitioner and, relevantly, for the purpose of these proceedings, s 82 provides:

‘(1) 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.’

49 Section 106KA of the Act defines ‘Patterns of services’:

‘(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.’

50 The effect of s 106KA(1) is to deem a prescribed pattern of services to be engaging in inappropriate practice. As s 106KA(7) shows, s 106KA(1) is not meant to be a code for conduct which amounts to inappropriate practice. The Committee is entitled to find any conduct to be inappropriate practice provided that it is conduct in connection with rendering or initiating services of a kind which would be unacceptable to the general body of general practitioners: s 82(1).

51 This appeal is not concerned with any other conduct other than conduct which might give rise to a prescribed pattern of services.

52 Subsection 106KA(3) contemplates regulations being made prescribing a pattern of services in relation to a particular profession.

53 Regulations have been made under the Act. Part 3 of the Health Insurance (Professional Services Review) Regulations 1999 (the Regulations) deals with ‘Prescribed pattern of services’. Regulation 8 provides:

‘8 This Part prescribes the circumstances in which referred services constitute a prescribed pattern of services for Part VAA of the Act.
Note Section 106KA of the Act provides that conduct of a person under review in connection with rendering or initiating services that constitute a prescribed pattern of services may be taken to be inappropriate practice.’

54 The practitioners affected by the Regulations are prescribed in reg 9:

‘9 For subsection 106KA(3) of the Act, the following groups of practitioners in the profession of medicine are groups to which these Regulations apply:

(a) general practitioners;

(b) other medical practitioners rendering professional attendances.’

55 Regulation 10 of the Regulations provides:

‘10 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.’

56 ‘Professional attendance’ is defined in reg 7:

‘professional attendance means a service of a kind mentioned in group A1, A2, A5, A6, A7, A13, A14 or A15 of Part 2 of the general medical services table.’

57 It follows that if a general practitioner renders 80 or more services that are professional attendances on each of 20 or more days in a 12 month period the general practitioner will have engaged in inappropriate practice.

58 If, however, the general practitioner satisfies the Committee that on a particular day or particular days during the relevant period, which is a period referred to in s 106KA(1) ‘exceptional circumstances existed that affected the rendering or initiating of services by the (general practitioner), the (general practitioners’) 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’: s 106KA(2).

59 Where it is established that a general practitioner has rendered 80 or more services that are professional attendances on each of 20 or more days in a 12 month period, the onus is cast upon the general practitioner to satisfy the Committee of the matters in s 106KA(2) so that that particular day or particular days during the relevant period should not count in determining whether the prescribed pattern of services has been established under s 106KA(1).

60 Section 106KA(5) provides for the making of regulations which might constitute exceptional circumstances in s 106KA(2).

61 Section 106KA(5) makes it clear, however, that the Regulations do not constitute a code of circumstances which would amount to ‘exceptional circumstances’. The circumstances which are declared by the Regulations to be ‘exceptional circumstances’ are deemed to be exceptional circumstances by force of the Act and Regulations.

62 Regulation 11 of the Regulations provides:

’11 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) the characteristics of the patients of the person under review.’

63 In my opinion, it is clear, when one reads s 106KA and the regulations made thereunder, that the Committee must consider what services that were professional attendances were rendered on a particular day in order to determine whether there is a prescribed pattern of services of the kind which would constitute engaging in inappropriate practice. It must first satisfy itself that the medical practitioner has rendered 80 or more services that were professional attendances on each of 20 separate days in a 12 month period. Unless it is satisfied of that, it cannot, at least under s 106KA(1), find that the medical practitioner has engaged in conduct which constitutes inappropriate practice.

64 Once the Committee has identified the particular days upon which 80 or more services that were professional attendances were rendered and is satisfied that that pattern of services existed on 20 or more days, then the onus falls upon medical practitioner, if the number of days upon which the prescribed pattern of services is to be reduced, to satisfy the Committee that on a particular day or particular days during that period exceptional circumstances existed of the kind referred to in s 106KA(2) or reg 11.

65 That means there must be a consideration as to whether exceptional circumstances of the kind referred to in s 106KA(2) existed on each of the particular days which form the prescribed pattern of services.

66 In my opinion, to constitute exceptional circumstances, the circumstances must be unusual or out of the ordinary or they must be circumstances of the kind that reg 11 prescribes as exceptional circumstances. More needs to be said about the construction of reg 11(b) in relation to one of the issues raised on the cross-appeal.

THE ISSUES ON THE APPEAL AND CROSS-APPEAL

67 Two matters are raised on the appeal. First, whether the Commission was entitled to make an investigative referral to the Director under s 86 of the Act simply upon evidence that the appellant had rendered 80 or more services that were professional attendances on more than 20 days in a 12 month period, or whether the Commission should have considered other relevant matters. Secondly, whether the Director failed to have regard to s 92 before proceeding under s 93 of the Act. Two matters are raised on the cross-appeal; one of which is a matter of substance; the other a matter of form. The matter of substance raised by the cross-appeal is the construction of ‘exceptional circumstances’ in s 106KA(2) of the Act and the construction of reg 11 of the Regulations.

68 The cross-appeal also raises for consideration the form of paragraph 2 of the primary judge’s orders. In that regard it is claimed on the cross-appeal that if the primary judge was right to set aside the Committee’s decision the order he made was inappropriate. The matter should have been remitted to the same Committee; Professional Services Review Committee 298.

THE FACTS

69 On 12 September 2000 the appellant was counselled by a medical practitioner, Dr Bates, a Commission medical adviser, about the total services rendered to his patients and pharmaceutical issues.

70 On 2 November 2000 the Manager (Professional Review Branch, New South Wales) of the Commission wrote to the appellant in the following terms:

‘Thank you for your co-operation and assistance on 12 September 2000 with Dr Bates when your practice profile was discussed. Dr Bates also discussed the Professional Services Review Scheme.

Dr Bates forwarded to you a copy of her report on 19 September 2000 and invited you to comment, within fourteen days. As no response has been received, it is assumed that you regard the report as accurate.

The Case Management Committee on 26 October 2000 determined that concerns with possible inappropriate practice remain in the following areas :-

1. High total services
2. High daily volumes
3. Pharmaceutical issues

Of particular concern was that you have provided more than 80 professional attendances on each of twenty or more days since January 2000 and this is in breach of amendments to the Health Insurance Act. The amendments are described at Paragraph 8.1.8 of the Medicare Benefits Schedule.

The Case Management Committee determined that the issues raised by Dr Bates were of a significant concern. This matter will now be forwarded to the Manager, Professional Services Branch for consideration of referral to the Director of Professional Services Review.

The Manager Professional Services Branch will review the data and advise you of the decision.’

71 On 6 December 2000 Dr Oreb was formally counselled by the Director in relation to an unrelated matter. Dr Oreb’s conduct had been reviewed by the Professional Services Review Committee which found his conduct to be unacceptable with regard to services referred by the Commission for the period 1 July 1995 to 30 June 1996. The Committee’s finding was made on 7 December 1998. A final determination was made by the determining officer of the Professional Services Review Scheme on 18 May 2000. That determination included directions in accordance with s 106U(1)(b) of the Act that the appellant be counselled by the Director.

72 On 23 July 2001 the Commission made an investigative referral (No. 260) to the Director in respect of services rendered by the appellant. On 26 July 2001 the Director wrote to the appellant indicating that he had received a referral on 23 July 2001 and asking the appellant whether he wished to make written submissions to him as to why the Director should dismiss the referral without setting up a Professional Services Review Committee.

73 On 7 November 2001 the appellant responded to that invitation and made submissions.

74 On 7 December 2001 the Director exercised his power under s 93A to take no further action in respect of the Investigative Referral No. 260 because of the possibility that that investigative referral was invalid.

75 On 13 December 2001 the Commission made a further investigative referral (No. 298) to the Director in relation to the period 1 January 2000 to 8 August 2000.

76 The reasons which were given for the investigative referral by the Commission were:

‘B. REASONS FOR INVESTIGATIVE REFERRAL

Part VAA of the Act provides a scheme (the Professional Services Review Scheme) under which a practitioner’s conduct can be examined to ascertain whether they have engaged in inappropriate practice as defined in section 82.

Section 106KA of the Act (which section commenced on 1 August 1999) also provides that, if, during a particular 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 to have constituted engaging in inappropriate practice.

Dr Oreb is a medical practitioner (as defined in the Act) and, for present purposes, Part 3 of the Regulations (which part commenced on 1 January 2000) applies. Part 3 provides that, in relation to medical practitioners, 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, where "professional attendance" means a service of a kind mentioned in group A1, A2, A5, A6, A7, A13, A14 or A15 of Part 2 of the general medical services table (as defined in the Act).

C. REFERRED CONDUCT AND PARTICULARS OF SERVICES

In accordance with subsection 86(4)(b) of the Act, the HIC considers Dr Oreb may have engaged in inappropriate practice because there is evidence that some of Dr Oreb’s professional attendances constitute a prescribed pattern of services as defined in section 106KA of the Act and Part 3 of the Regulations.

Specifically, the HIC’s records for professional attendances rendered by Dr Oreb during referral period show that Dr Oreb:

rendered 80 or more professional attendances per day on 33 occasions on and from 24 January 2000 to and including 8 August 2000.

Further material in relation to the referred conduct and particulars of services is attached as part of this Investigative Referral.’

77 In its investigative referral, the Commission outlined Dr Oreb’s relevant history.

78 On 18 December 2001 the Director wrote to the appellant in the following terms:

‘On 14 December 2001, I received Investigative Referral No. 298 from the Health Insurance Commission (the HIC) regarding your conduct in relation to the Medicare program.

I understand that the HIC has delivered to you a copy of the referral documentation and the relevant sections of the Health Insurance Act 1973 (the Act). In accordance with subsection 89(1) of the Act, I must carry out an investigation of this referral. 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.

Subsection 88(3) of the Act provides that you may make written submissions to the Director, within 14 days of the day when you were sent the referral, as to reasons why the Director should dismiss the referral without setting up a Professional Services Review Committee. I would be pleased to receive a submission from you and would give it careful consideration along with any other relevant documents or materials I may decide to obtain.

Should you wish to communicate with this office, the address and telephone numbers are detailed below. If you would prefer any further communications from this office to be directed to you at another address, I would appreciate your written advice.

If you have any questions, please contact the Administrative Officer, Mrs Belinda Stewart, during business hours on [phone].’

79 The appellant did not respond to that letter or make submissions in relation to reasons why the Director should dismiss the referral without setting up a Professional Services Review Committee. As I have already stated, the appellant had previously written giving reasons why a Professional Services Review Committee should not be set up in relation to Investigative Referral No. 260.

80 On 5 March 2002 the Director wrote to the appellant advising him that he had conducted his examination pursuant to s 89 of the Act and, as a result, he had established Professional Services Review Committee No. 298 ‘to inquire into whether conduct by you in connection with rendering services specified in the Adjudicative Referral constituted engaging in inappropriate practice within the meaning of section 82 of the Act’.

81 The Adjudicative Referral No 298 was in the following terms:

‘ADJUDICATIVE REFERRAL No. 298 UNDER SECTION 93(1)

CONCERNING Dr Zelko Oreb
of
369 King Street
Newtown NSW 2042

BACKGROUND

1. On 13 December 2001, pursuant to subsection 86(1) of the Health Insurance Act 1973 ("the Act"), a delegate of the Health Insurance Commission ("the Commission") made Investigative Referral No. 298 ("the investigative referral") to the Director of Professional Services Review ("the Director").

2. The investigative referral concerned the conduct of Dr Zelko Oreb ("Dr Oreb"), a medical practitioner of the above addresses, relating to whether he had engaged in inappropriate practice in connection with the rendering of services constituting a prescribed pattern of services within the meaning of subsection 106KA(1) of the Act and Part 3 of the Health Insurance (Professional Services Review) Regulations 1999 ("the Regulations"). The investigative referral related to all services ("the referred services") rendered by Dr Oreb which were rendered:

within specified locations, namely

369 King Street
Newtown NSW 2042

within a specified period, namely on and 1 January 2000 to and including 8 August 2000 ("the referral period").

3. Pursuant to subsection 89(1), I conducted an investigation into the referred services. I did not dismiss the referral under section 91 of the Act as I was not satisfied that there were insufficient grounds on which a Committee established under section 93 of the Act could reasonably find that Dr Oreb had engaged in inappropriate practice in connection with rendering the referred services.

4. Pursuant to subsection 93(1) and in accordance with Division 4, on 5 March 2002 I set up a Committee ("PSRC No. 298") to consider whether the conduct of Dr Oreb in connection with rendering the services specified in paragraph 5 below constituted engaging in inappropriate practice.

ADJUDICATIVE REFERRAL

5. Pursuant to subsection 93(1), I hereby make this adjudicative referral to PSRC No. 298 to consider whether the conduct of Dr Oreb in connection with rendering the following services ("the specified services") constituted engaging in inappropriate practice because the circumstances in which some or all of the specified services were rendered constituted a prescribed pattern of services as defined in section 106KA of the Act and Part 3 of the Regulations:

all professional attendances (as defined in Regulation 7) rendered by Dr Oreb within the referral period within specified locations, namely

369 King Street
Newtown NSW 2042

6. The following material is attached, as part of this referral, for the information of PSRC No. 298:

Attachment A: My report pursuant to subsection 93(6); and

Attachment B: Health Insurance Commission’s Investigative Referral No. 298.’

82 In that Adjudicative Referral the Director gave reasons why he did not dismiss the referral made under s 91 of the Act. Sections 89A and 93A were not relevant and not addressed. The Director did not address s 92 in that document.

83 On 22 May 2002 the appellant attended a hearing before the Professional Services Review Committee and tendered a written submission.

84 On 8 November 2002 the Professional Services Review Committee provided its final report. A copy of the report was forwarded to the appellant under cover of a letter dated 11 November 2002.

85 The members of the Professional Services Review Committee unanimously found that the appellant had engaged in inappropriate practice by rendering 80 or more professional attendances on each of the 33 days which constituted a prescribed pattern of services under s 106KA(1) of the Act. The Committee did not consider that exceptional circumstances existed that affected the rendering of services by the appellant on any of the 33 days in question.

THE PRIMARY JUDGE’S REASONS AND CONCLUSIONS

86 Contrary to the appellant’s submissions, the primary judge found that Investigative Referral No. 298 by the Commission to the Director was valid. Particularly, the primary judge found that the Commission can refer the question whether a person has engaged in inappropriate practice by reason of a prescribed pattern of services under s 106KA to the Director, but must not ‘make a referral by reference to s 106KA alone where other relevant circumstances exist and should have been taken into account’. He also found that the counselling sessions, to which I have referred, which preceded the investigative referral by the Commission to the Director, did not constitute a relevant consideration which the Commission failed to take into account.

87 Again, contrary to the appellant’s submission, the primary judge found that adjudicative referral 298 which gave rise to the setting up of the Committee was valid. The primary judge found that the appellant had been given the option of entering into a s 92 agreement and thereby he was not denied procedural fairness. Moreover, the primary judge found that, in any event, the Director was not obliged to consider whether a s 92 agreement would be appropriate in the absence of any acknowledgement of guilt and a request from the practitioner. Even if the Director should have considered the submission made by Dr Oreb on the investigative referral, that submission did not contain any acknowledgement of inappropriate practice and therefore did not invite recourse to s 92 of the Act.

THE APPEAL

88 In my opinion, the appellant’s contentions that the investigative referral and the adjudicative referral are invalid must be rejected.

89 As already indicated, the power to make the investigative referral is contained in s 86 of the Act. 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

...

(b) set out the reasons why the Commission considers the person under review may have engaged in inappropriate practice.’

90 Regulation 10 prescribes a pattern of services.

91 Section 106KA(1) deems particular conduct of a person to constitute a pattern of services. It also makes that conduct inappropriate practice. The Commission may refer to the Director the conduct of a practitioner in relation to inappropriate practice. That investigative referral must contain the particulars under s 86(4). The investigative referral must also contain the Commission’s reasons why the practitioner is thought to have engaged in inappropriate practice.

92 In my opinion, the Commission is entitled to have regard to the prescribed pattern of services if that is the reason for the investigative referral. Indeed, the Commission must do so. If the only reason for the investigation referral is because the practitioner is thought to have engaged in inappropriate practice because the services rendered or initiated by the practitioner constituted a prescribed pattern of services, the Commission could not avoid having regard to that matter. The inappropriate practice is the rendering of the prescribed pattern of services.

93 As already indicated, s 106KA(1) provides that if the medical practitioner has engaged in conduct which constitutes the prescribed pattern of services, that conduct will amount to inappropriate practice unless the medical practitioner is able to establish exceptional circumstances under s 106KA(2). Any other conduct, in connection with rendering or initiating services, which would be unacceptable to the general body of general practitioners, could also constitute a reason for an investigative referral to the Director.

94 If, however, the Commission is not aware of any conduct of that kind but is aware that the medical practitioner has engaged in conduct which amounts to a prescribed pattern of services, that matter must be taken into account in considering whether or not there should be an investigative referral to the Director.

95 Of course, if there is any other conduct or circumstance known to the Commission which would impact upon whether or not the medical practitioner might have engaged in conduct which amounts to a prescribed pattern of services or any other conduct relevant to the question as to whether or not there should be an investigative referral, the Commission should have regard to that conduct.

96 In Kelly v Daniel [2004] FCAFC 14; (2004) 134 FCR 64 at [81], the Full Court of this Court said:

‘... the Commission is not entitled to make an investigative referral decision by reference to s 106KA(1) alone ... To the extent that the Commission may have regard to patterns of services in determining whether to make an investigative referral, that is but one way of a number matters that it may take into account. In our opinion the fact that Dr Daniel’s conduct had already been the subject of review by the Commission, and that no action had been taken to refer his case to the Director as a consequence, was plainly relevant to the exercise of the Commission’s discretion under s 86 to make an investigative referral.’

97 There may be other facts and circumstances apart from conduct which constitutes the prescribed pattern of services known to the Commission which would make it inappropriate to make an investigative referral. The Commission may, for example, be satisfied that on the particular day which constituted the prescribed pattern of services that exceptional circumstances existed on one or more days that affected the rendering or initiating of the practitioner’s services. It may therefore know that the number of days might be reduced below the days prescribed in the Regulations. In those circumstances, it would not be appropriate to make an investigative referral to the Director. There may be other circumstances again known to the Commission which would bear upon the exercise of the Commission’s discretion to refer the matter to the Director. Any matter relevant to the exercise of the Commission’s discretion and known to the Commission should be taken into account by the Commission in exercising its discretion under s 86.

98 In this case, the appellant had been counselled on two occasions. The first occasion was a matter separate to that which formed the subject matter of the investigative referral from the Commission to the Director. In relation to the matter which became the subject matter of the investigative referral, he had also been counselled but it was plain that the Commission was not satisfied that counselling might have the desired effect. That was made plain to the appellant. There is nothing to suggest the Commission failed to take into account the previous counselling which had been provided to the appellant.

99 The appellant contended that there were three matters not taken into account by the Commission in making its investigative referral to the Director. First, the fact that the appellant had been counselled by the Commission’s medical adviser in September 2000. Secondly, the fact that the appellant had been counselled by the Director in December 2000. Thirdly, that he had restructured his practice and reduced his rate of servicing.

100 In putting that submission, the appellant argued that the reasons given for the investigative referral, and in particular in paragraph (c) of that referral, do not disclose that the Commission had regard to those three matters.

101 In my opinion, the absence of a mention of those three matters in the reasons does not mean that the Commission did not have regard to those matters. The reasons which must be given by the Commission under s 86(4)(b) are ‘the reasons why the Commission considers the person under review may have engaged in inappropriate practice’. The Commission does not have to give reasons why it has decided to make an investigative referral but only the reasons why it considers the practitioner may have engaged in inappropriate practice. The purpose of the Commission’s reasons is to identify the matters into which the Director needs to inquire. In my opinion, the reasons which were advanced by the Commission were appropriate having regard to the reasons which the Commission had to give.

102 In those circumstances, the appellant cannot, in my opinion, rely upon the Commission’s failure to mention the three matters to which the appellant referred for arguing that the Commission failed to have regard to them.

103 In any event, the first two matters to which the appellant referred are not matters that ought to have been taken into account by the Commission. The first would not be a matter which would necessarily mean that the practitioner’s conduct should not be referred to the Director. As the Commission’s letter of 2 November 2000 shows, the Commission was not satisfied with the practitioner’s explanation given at the first counselling session. The second matter, which the appellant said should have been considered by the Commission, indicates that the Commission had formed the conclusion that conduct on a previous occasion had been unacceptable. That would not be a relevant matter, in my opinion, for not referring the matter to the Director. Rather, it would have been a relevant matter for referring it to the Director.

104 The third matter was not relevant to the question of inquiring into the practitioner’s conduct. It would, if the conduct did amount to inappropriate practice, be a relevant matter to which the Determining Authority might have regard in considering what directions it ought to give upon a finding by the Professional Services Review Committee that the appellant had been guilty of inappropriate practice.

105 In my opinion, the appellant has not been able to demonstrate that there was any relevant matter which the Commission was bound to take into account and which was not taken into account in making the decision to refer the matter to the Director.

106 For those reasons, insofar as the appeal complains of the primary judge’s refusal to quash the Commission’s decision to make the investigative referral the appeal must be dismissed.

107 The appellant also complained of the decision of the Director to make an adjudicative referral to the Professional Services Review Committee No. 298.

108 In that regard, the appellant contended that the Director erroneously construed the Act as establishing a separate procedure for investigative and adjudicative referrals alleging conduct constituting a prescribed pattern of services within s 106KA of the Act. He also contended that the Director failed to consider whether, during the referral period, the appellant might have engaged in inappropriate practice as defined in s 82 of the Act. Thirdly, it was contended that the Director failed to consider changes to the appellant’s pattern of services which occurred during the referral period and after the services identified in the investigative referral. Lastly, the Director, it was argued, failed to have regard to the counselling of the appellant by a Commission medical adviser in September 2000 and by himself in December 2000, and to the appellant’s subsequent conduct.

109 None of the contentions should be accepted.

110 In my opinion, the Director did not fall into the error identified in the first contention. There is no separate procedure for adjudicative referrals where the inappropriate practice is said to arise out of a prescribed pattern of services. However, in my opinion, there is nothing to support the contention that the Director treated the adjudicative referral procedure, in relation to alleged conduct which constituted a prescribed pattern of services within s 106KA of the Act, as being a procedure separate from any other procedure.

111 In a sense, the first contention relies upon the second because there is no evidence that the Director considered whether the appellant might have engaged in inappropriate practice of any kind except that relating to conduct constituting a prescribed pattern of services.

112 Nor, in my opinion, did the Director need to consider any other inappropriate practice apart from that which was referred to him by the Commission in its investigative referral.

113 It was open to the Director to consider any other practice which might give rise to inappropriate practice but he was not bound so to do.

114 In my opinion, the Director, quite rightly, proceeded upon the investigative referral upon the basis that the conduct into which he had to inquire was whether the appellant had engaged in conduct constituting a prescribed pattern of services.

115 The third and fourth contentions are really the same contentions which were put in relation to the Commission’s decision. There was some evidence that, following upon the counselling which occurred in September and December 2000, the appellant’s level of servicing reduced but, even if that were so, it does not follow that the Director could not rationally and reasonably proceed to set up a Committee and make an adjudicative referral pursuant to s 93.

116 For the reasons given in relation to the Commission’s decision, the appellant’s conduct subsequent to the conduct being inquired into would certainly be a relevant matter for the Determining Authority to take into account but was not necessarily a relevant matter for the Director to take into account.

117 As I have already mentioned in relation to the Commission’s decision, the Commission was not satisfied with the result of the counselling provided to the appellant on 12 September 2000. That clearly appears from the letter of the Manager of the Professional Review Branch of the Commission dated 2 November 2000.

118 The counselling provided to the appellant on 20 December 2000 was, as I have already said, in relation to previous conduct.

119 That counselling would not have been relevant in deciding whether an adjudicative referral should not be made. It may have been relevant in determining whether the adjudicative referral should be made.

120 In my opinion, the appellant’s complaints about the decision to set up a Committee and make an adjudicative referral should be rejected.

121 Next, the appellant contended that s 92 should be construed as imposing a ‘positive duty to approach the doctor under investigation and offer to him or her the opportunity to negotiate for and enter into a section 92 agreement’. In my opinion, there is nothing in s 92 itself or in any of the other provisions of the Act which supports such a contention.

122 Section 88 obliges the Commission to send a copy of the investigative referral to the person under review within 48 hours of sending the investigative referral to the Director: s 88(1).

123 The Commission is also obliged to give notice to the person under review that that person may make written submissions to the Director within 14 days stating why the Director should dismiss the referral without setting up a Committee: s 88(2).

124 Section 89 allows the Director to conduct the investigation in such a manner as he or she thinks appropriate.

125 As I have already indicated, as a result of that investigative referral, the Director might send the matter to the Commission if the Director thinks an offence might have been committed under s 124B (s 89A(1)), or summarily dismiss the investigative referral (s 91), or enter into an agreement between himself or herself and the person under review (s 92), or set up a Committee in accordance with Division 4 (s 93), or decide to take no action (s 93).

126 There is nothing in the language of the Act which requires the Director to offer to enter into an agreement with the person under review under s 92. Indeed, the fact that so many options are available to the Director is a good reason for thinking there is no positive obligation on the Director to offer the practitioner a s 92 agreement.

127 The Director is entitled to make that offer provided, of course, that the person under review is prepared to acknowledge that the conduct during the referral period constituted engaging in inappropriate practice and provided that the person under review is prepared to enter into an agreement which includes any one or more of the matters in s 92(2). That is one option available to the Director but is not something that the Director is required to do.

128 In any event, in this case, the Director did in his letter of 18 December 2001 provide the appellant with the information regarding the various outcomes which might flow from the investigative referral, including the possibility of a s 92 agreement.

129 There is nothing to support the contention that the Director failed to have regard to all of the options which were available to him after conducting his inquiry under s 89. He was not bound to appoint a Committee under s 93 but he was entitled so to do.

130 The appellant’s contentions must fail because the Director did put the option of a s 92 agreement to the appellant. In those circumstances, the appellant’s contentions fail both on the construction of the Act and on the facts. In those circumstances, the appeal must fail.

THE CROSS-APPEAL

131 The respondents/cross-appellants contended that in construing this legislation, and in particular s 106KA, the Court should have regard to the purpose of the legislation.

132 The legislation was enacted following upon an inquiry into the Professional Services Review Scheme and the report of the Review Committee of the Professional Services Review Scheme which was published in March 1999.

133 That Committee observed:

‘The medical profession generally accepts that high volume provision of services by a practitioner prohibits adequate critical input.’

134 The respondents/cross-appellants argued that this Court should follow a decision of Gray J in Tisdall v Kelly [2005] FCA 365 (‘Tisdall v Kelly’). In that judgment, his Honour said at [66]:

‘... 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.’

135 I agree that that is the purpose of the legislation. The purpose of the legislation is achieved by a combination of the Act and Regulations.

136 Section 106KA(1) deems conduct which constitutes a prescribed pattern of services in reg 10 of the Regulations inappropriate practice.

137 The regulation maker has determined that 80 or more services that are professional attendances on a day is as many attendances as a general practitioner can deliver on a particular day and still give proper care and attention to each patient to whom the general practitioner has rendered a service. If a medical practitioner exceeds that number on 20 or more days then his conduct in rendering or initiating more than 80 services is deemed to be inappropriate practice.

138 However, the other thing to be kept in mind is that if a Committee reaches a conclusion that a general practitioner has engaged in conduct that constitutes a prescribed pattern of services, it will make a finding that he has engaged in inappropriate practice. Such a finding is a very serious matter for a general practitioner, not only because that finding carries with it a referral to a Determining Authority but because of the odium attached to such a finding.

139 Moreover, if such a finding is made, the Determining Authority can make determinations of the kind referred to in s 106U of the Act. Those determinations include a reprimand, counselling, or that a Medicare benefit ceases to be payable. Moreover, the Determining Authority can disqualify the practitioner in respect of the provision of specified services. The Determining Authority has the power to make determinations which could involve a general practitioner in significant financial hardship.

140 In Tisdall v Kelly, Gray J said that his view was that the combination of the provisions of s 106KA(2) and reg 11(b) is less than clear. That is not a view which I share. In my opinion, for the reasons which follow, the construction of the Act and reg 11 is tolerably clear.

141 On 13 December 2001, as noted, a delegate of the Commission made Investigative Referral No. 298 in respect of services rendered by the appellant. The investigative referral stated that the Commission’s records for professional attendances rendered by Dr Oreb show that Dr Oreb rendered 80 or more professional attendances per day on 33 occasions on and from 24 January 2000 to and including 8 August 2000.

142 On 5 March 2002 the Director set up Professional Services Review Committee 298 and made Adjudicative Referral 298 to that Committee to inquire into whether some or all of the specified services during the referral period may have constituted a prescribed pattern of services and whether Dr Oreb had engaged in conduct that constituted inappropriate practice.

143 A hearing was conducted by the Committee on 22 May 2002 and Dr Oreb attended before that Committee.

144 He tendered a written submission in which he set out the matters which, he said, constituted exceptional circumstances. They were:

‘41. The following exceptional circumstances applied to Dr Oreb’s practice during the period from 1 January to and including 8 August 2000.

(a) The patient profile of Dr Oreb’s practice was abnormally skewed towards refugees and patients with a strong connection to the former Yugoslavia.

The exceptional patient profile of Dr Oreb’s practice applied throughout the referral period. We submit that Dr Oreb’s patient profile is a significant abnormality of the circumstances in which the services referred to the Committee were rendered. We submit that significant abnormality is an exceptional circumstance in the terms of Section 106KA(2) of the Act.

(b) Dr Oreb’s patient base has demands for medical care which are above and beyond those of the normal general practitioner’s pratients.

(i) Many of Dr Oreb’s patients are refugees from the former republics of Yugoslavia and, as a consequence, his patients have a high incidence of PTSC and other conditions referrable to their experiences and the experiences of their families and friends in those republics. Those experiences include war, torture, rape and an absence of appropriate medical care and treatment.

(ii) Refugees and immigrants from the former Yugoslavia experience significantly lower levels of education than the average Australian.

(iii) Refugees and immigrants from the former Yugoslavia experience significantly lower levels of employment than the average Australian.

(c) Dr Oreb is uniquely qualified to provide medical care and treatment to his patient base because of the combination of his ethnicity, language skills and medical qualifications.

(d) Dr Oreb’s weekly work pattern is exceptional.

We submit that part of the philosophy behind Section 106KA of the Act is that Doctors who frequently render large numbers of services on a day may be working so hard and/or for such long hours that they may not have the physical and mental endurance to maintain the quality of their clinical input to those services. Whilst that may well be the case for a doctor who works day after day and/or neglects his/her own health, Dr Oreb is exceptional in that he does not render high numbers of services day after day (indeed on many days he renders none at all) and he takes great care to maintain his own health. We note that the reason for the referral of his conduct is not that there is any evidence suggestive of "overservicing" (his per patient statistics are not the subject of any complaint) nor is there any evidence of any inadequacy of his patient management. He merely has an unusual practice and has experienced some difficulties refusing treatment to unusually needy and demanding patients services during the relevant period.

We submit that Dr Oreb’s working schedule is an unusual circumstance in which the services referred to the Committee were rendered. We submit that significant abnormality is an exceptional circumstance in the terms of Section 106KA(2) of the Act.

General submission.

42. We submit that the intention of Parliament in introducing Section 106KA of the Act was to dissuade practitioners from frequently rendering high numbers of services on any one day. A "margin" of nineteen days during a twelve month period was allowed to take into account the fact that, even where there are no exceptional circumstances, normal workload variations occur and the eighty services "mark" may inadvertently be reached. However, Parliament recognised by Section 106KA(2) that all practices are not alike and there may be circumstances applying to a particular practitioner’s practice or to a particular time period which are beyond the practitioner’s control and which excuse the rendering of high numbers of services on particular days. Parliament also recognised that such circumstances were not capable of exhaustive definition and so left the determination of whether a practitioner’s particular circumstances are "exceptional" to a committee of the practitioner’s peers.

43. The combination of Dr Oreb’s unusual patient profile, unusual combination of language skills and ethnicity and the unusual problems experienced by his patients during the referral period are exceptional.

44. We submit that the circumstances described above constitute exceptional circumstances for the purpose of Section 106KA(2) of the Act. We submit that the Committee should not find that Dr Oreb’s conduct in connection with rendering the referred services constituted engaging in inappropriate practice.’

145 In his evidence before the Committee, he said that he was born in Dalmatia which, although part of Croatia, was viewed neutrally by the other former states of Yugoslavia. He said that he spoke Croatian and Serbo-Croatian languages and ‘a little bit’ of the Macedonian language.

146 He said that 20 per cent of his patients were refugees or victims of torture and trauma, and 99 per cent of his patients are Croatian, Serbian or Muslims. He said that there was a lack of other Serbo-Croatian speaking doctors in his area. His patients come from ‘Liverpool, from Mona Vale, from all over Sydney’.

147 He consulted only four days a week; not on Wednesdays or weekends. Patients who attempted to see him on Wednesdays would usually be referred to the hospital system.

148 During the hearing, the Chair of the Committee invited Dr Oreb to give evidence of any ‘exceptional circumstances’ relating to any of the 33 days in issue.

149 Dr Oreb said that, apart from submissions made and the evidence given, he was not able to add any further detail.

150 On 4 July 2002 Dr Oreb provided the Committee with a further submission in which he reiterated his evidence that 20 per cent of his patients are refugees from the former state of Yugoslavia and a further 70-79 per cent are of former Yugoslavian ethnicity.

151 Many of his consultations, he said, are conducted in the Serbo-Croatian language. He said that those patients were not able to communicate to the same extent in English as they could in their native language and that was an exceptional circumstance operating on his practice.

152 He submitted that he was uniquely placed to care for his patients from the former Yugoslavia due to his particular combination of language skills and ethnicity.

153 On 8 November 2002 the Committee made its final report.

154 First, it noted that Dr Oreb did not dispute, and accepted as correct, the Commission’s data establishing that he had rendered 80 or more professional attendances on 33 days. A finding was made to that effect.

155 Once that finding was made the Committee was under an obligation to consider the question of exceptional circumstances, which it did.

156 Before it dealt with each of the matters raised by Dr Oreb, it considered the construction of s 106KA(2) and reg 11. It said:

‘45. This Committee considers that this confirms 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.

46. 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 within one 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 – and it will be difficult to justify this on an on-going basis.’

157 For reasons which follow, in my opinion, the Committee fell into error in its construction of s 106KA(2) and reg 11 by failing to have regard to the terms of reg 11 itself.

158 The Committee dealt specifically with each of the matters raised by Dr Oreb. First, it dealt with the matter of patient demand. In that respect, it said:

‘56. The Committee does not accept that patient demand experienced by Dr Oreb constitutes exceptional circumstances. The Committee considers that the level of patient demand remained relatively static and therefore a foreseeable circumstances. Because the relevant circumstances were foreseeable they could and should have been managed to promptly bring patient attendance rates down to acceptable levels such that proper clinical care can be provided to all patients – see paragraph 45. Mr Wade, on behalf of Dr Oreb, submitted at the commencement of the hearing that "... exceptional really just means abnormal ...". The Committee considers the patient demand experienced by Dr Oreb during the referral period was normal for his practice. The Committee considers some effort could have been made to limit the number of patients seen by Dr Oreb, eg an appointment system. Dr Oreb advised the Committee that he has recently introduced an appointment system to his practice, confirming the Committee’s view that management of patients is possible in Dr Oreb’s practice. Dr Oreb did not present any evidence to the Committee that he had attempted to develop or put in place an action plan to control patient demand during the referral period.’ (Footnotes omitted.)

159 Next, it dealt with patient profile. It accepted the appellant’s claim that the individuals who have been subject to trauma associated with the war in Bosnia had special care needs and that they would need more than average attention.

160 However, it said:

‘59. However, the Committee does not accept that Dr Oreb’s patient base constitutes exceptional circumstances. The patient base remained relatively static and was a foreseeable circumstance which should have been managed to promptly bring patient attendance rates down to acceptable levels – see paragraph 45.

60. Dr Oreb’s oral evidence that he spends only 10-15 minutes with a new patient from this group and 10-15 minutes on subsequent professional attendances indicated to the Committee (albeit without examining any particular services) that it is highly likely that Dr Oreb was not providing an appropriate level of clinical input for adequate care and management of this group of patients.

61. Dr Oreb did not present any evidence to the Committee that he had attempted during the referral period to develop or put in place measures to manage or control what he perceived as a unique patient base. However, Dr Oreb advised the Committee that he has recently introduced an appointment system to his practice, confirming the Committee’s view that management of his patient numbers was possible.’ (Footnotes omitted.)

161 Next, it addressed the appellant’s linguistic ability to deal with a patient profile. Specifically, it dealt with the appellant’s claim that 95-99 per cent of his patients were from a non-English speaking background from the former Yugoslavia.

162 It found that the majority of the appellant’s patients were from a non-English speaking background but was not prepared to accept the appellant’s estimate.

163 It did not accept that the appellant’s perception of his unique position to deal with his patient base constituted exceptional circumstances.

164 It said:

‘65. The Committee does not accept that Dr Oreb’s perception of his unique position to deal with his patient base constitutes exceptional circumstances. The Committee considers that the patient base remained relatively static and therefore was a foreseeable circumstance. Because the relevant circumstances were foreseeable they could and should have been managed to promptly bring patient attendance rates down to acceptable levels such that proper clinical care can be provided to all patients – see paragraph 45. Dr Oreb did not present any evidence to the Committee that he had attempted to develop or put in place an action plan to avoid providing a high number of services on a regular basis.’

165 The appellant told the Committee that he was unable to attract or retain sufficient appropriate medical services to his practice. The appellant gave evidence that he had advertised in the ‘Herald’ and put out ‘feelers’ within the Church community for another doctor to join his practice but had received no response.

166 The Committee, in dealing with that submission, said:

‘67. The Committee does not accept that Dr Oreb’s inability to attract and retain appropriate medical services to his practice constitutes exceptional circumstances. The Committee is of the opinion that the patient base and patient demand, and therefore the need for another medical practitioner, remained relatively static and therefore was a foreseeable circumstance. Because the relevant circumstances were foreseeable they could and should have been managed to promptly bring patient attendance rates down to acceptable levels such that proper clinical care can be provided to all patients – see paragraph 45. Dr Oreb did not present any evidence to the Committee that he had attempted to develop or put in place a continuing action plan to attract another medical practitioner to his practice or to reduce patient numbers until such time as another practitioner has been retained.’

167 The last matter addressed by the Committee was the appellant’s work pattern. The Committee said of that:

‘69. It is the Committee’s opinion that Dr Oreb has made a work/lifestyle decision to not see patients on Wednesdays, Saturdays or Sundays. If Dr Oreb had provided the same total number of services (as he provided during the referral period) over 5 working days per week, his average services would have been 56.5 services per day. It is the Committee’s opinion that Dr Oreb made a "lifestyle choice" to see a high number of patients on each of the 4 days he worked each week to enable him to have each Wednesday free of patients, without compromising his income from Medicare.


70. The Committee does not accept that Dr Oreb’s perceived exceptional work pattern constitutes exceptional circumstances. The Committee is of the opinion that the patient base and patient demand remained relatively static and therefore a foreseeable circumstance. Because the relevant circumstances were foreseeable they could and should have been managed to promptly bring patient attendance rates down to acceptable levels such that proper clinical care can be provided to all patients – see paragraph 45. The Committee feels some effort could have been made to limit the number of patients seen by Dr Oreb and therefore hours worked, eg an appointment system. Dr Oreb advised the Committee that he has recently introduced an appointment system to his practice, illustrating the Committee’s view that management of patients is possible in Dr Oreb’s practice. Dr Oreb did not present any evidence to the Committee that he had attempted to develop or put in place an action plan to manage or control what he perceived as his exceptional work pattern during the referral period.’ (Footnotes omitted.)

168 For those reasons, the Committee rejected the appellant’s claim of exceptional circumstances.

169 I will return to this matter but it is not clear from the Professional Services Review Committee’s decision whether it was addressing exceptional circumstances under s 106KA(2) or reg 11, or both. For reasons which I will give, it seems to me that different circumstances will give rise to exceptional circumstances under paragraphs 11(a) and (b) of reg 11, and under s 106KA(2).

170 The cross-appeal is against paragraph 1 of the orders made by the primary judge in which the primary judge set aside the findings of Committee 298, although it was wrongly described in the order as the finding of ‘Committee 198’.

171 In reaching his conclusion that the findings of Committee 298 ought to be set aside, the primary judge concluded that the Committee had placed an unwarranted gloss on the meaning of the words ‘exceptional circumstances’ in s 106KA(2) and reg 11(b). His Honour found at [220]:

‘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).’

172 He further found at [223]:

‘The Committee found that the matter put forward by Dr Oreb, which included the location of his practice and the characteristics of his patents, were foreseeable and did not constitute exceptional circumstances. The question of whether there were exceptional circumstances was a question of mixed fact and law, but it seems to me that Committee 298 reached its conclusion on the basis of its incorrect interpretation of the "exceptional circumstances" provision. That is to say it approached its finding on the basis that Dr Oreb had a heavier onus of satisfying the Committee in relation to ongoing circumstances than in a case of an episodic or unusual event.’

173 For the reasons which follow, I agree with the primary judge’s reasons in relation to both those matters. I agree that the Committee erred in its construction of the Act and Regulations to require ‘episodic events’. I also agree that the Committee was wrong to consider whether the circumstances were foreseeable or not.

174 The issue which is thus raised on the cross-appeal is the construction of s 106KA(2) and reg 11(b). For the purposes of s 106KA(1), inappropriate practice is measured by a consideration of at least 20 particular days over a period not exceeding one year: reg 10. If on 20 or more days 80 or more services that are professional attendances are rendered by, in this case, the general practitioner, then the general practitioner will be deemed to have engaged in inappropriate practice. Thus it is that individual days are considered over the period of one year, not the whole of the period.

175 That it is a consideration of individual days is reinforced by reference to s 106KA(2) which talks of a particular day or particular days. Therefore, for the purpose of s 106KA(2), in considering whether exceptional circumstances exist, the decision-maker must have regard to whether exceptional circumstances exist on any of the days which it has taken into account under s 106KA(1).

176 Thus it is that in considering whether exceptional circumstances exist reference is made to the particular days which have been identified for the purpose of s 106KA(1) and which, by force of that section, has deemed the medical practitioner to have engaged in inappropriate practice.

177 In a sense it is quite irrelevant that the exceptional circumstances might have existed for the whole of the period under consideration, because after the decision-maker has identified the particular days under s 106KA(1), within the period not exceeding one year, the rest of the days when the decision-maker has not rendered 80 or more services are irrelevant.

178 I will come to the Regulations shortly. However, before doing so, I should observe that a general practitioner might seek to establish ‘exceptional circumstances’ without reference to the Regulations. Section 106KA(5) preserves a general practitioner’s right to establish exceptional circumstances without reference to the Regulations. If the general practitioner seeks to invoke the provisions of s 106KA(2) without reference to the Regulations the general practitioner must establish that exceptional circumstances existed. In that case, the general practitioner will need to establish that the circumstances, whatever they were, were exceptional in the sense that they are unusual or out of the ordinary. As I have said, however, it is not appropriate to substitute other words for the words in the statute. The test must remain, were the circumstances exceptional? If the general practitioner establishes that exceptional circumstances existed, he must then establish that those circumstances affected the rendering or initiating of services by that general practitioner on a particular day or particular days. In establishing that the exceptional circumstances affected the rendering or initiating of services, the general practitioner does not need to establish that those circumstances were the only circumstances affecting that matter. Indeed, the general practitioner does not need to establish the circumstances were the dominant circumstances affecting the rendering or initiating of services. The section only requires that the exceptional services affected the services rendered or initiated by the general practitioner. ‘Affected’ is used in s 106KA(2) in the sense of acted upon or influenced. Thus, there must be a relationship between the exceptional circumstances and the rendering or initiating of services in the sense that the former acted upon or influenced the latter. However, the exceptional circumstances need not be the only matter acting or influencing the rendering or initiating of services. Other matters which might be quite unexceptional might also affect the rendering or initiating of services.

179 Whether there are other matters affecting, in the sense of acting upon or influencing the rendering or initiating of services, is quite irrelevant unless it can be established that they were the only matters affecting the rendering or initiating of services so that it can be said that the exceptional circumstances did not affect the rendering or initiating of services.

180 The general practitioner’s management of his practice will, in all cases, affect the way in which he or she renders or initiates services. The hours that general practitioner works will affect the number of patients that general practitioner sees. It may be that by reducing the hours the general practitioner will reduce the number of services rendered. However, that does not mean that a general practitioner cannot establish that exceptional circumstances affected the rendering or initiating of services. The general practitioner’s management of the practice becomes irrelevant if the general practitioner has established that exceptional circumstances affected the rendering or initiating of services on the particular day or days.

181 Of course, the general practitioner must establish also that those exceptional circumstances existed and affected the services rendered or initiated on the particular day or days. The particular day or days are any of the days identified by the Committee which form part of the prescribed pattern of services in s 106KA(1).

182 A regulation has been made under s 106KA(5). Regulation 11 has been promulgated to provide circumstances which are, by force of that subsection, exceptional circumstances.

183 Regulation 11 has two separate limbs and in the second limb two criteria.

184 In neither limb does a practitioner have to establish exceptional circumstances according to the general meaning of that term in s 106KA(2) because the two limbs are separately, by force of s 106KA(5) of the Act, exceptional circumstances.

185 Regulation 11(a) will operate in conjunction with s 106KA(2) to extinguish a particular day from the decision-maker’s consideration of s 106KA(1) if the general practitioner can establish that an ‘unusual occurrence causing an unusual level of need for professional attendances’ ‘that affected the rendering or initiating of services by the practitioner’ occurred on that particular day or those particular days.

186 For that paragraph of the regulation to be enlivened the occurrence must be unusual. That means it must be out of the ordinary or indeed exceptional. An unusual circumstance will also be an exceptional circumstance. An unusual or exceptional circumstance is a circumstance which is out of the ordinary. Whilst an unusual circumstance is something which is out of the ordinary or exceptional, there is no warrant for using those words in lieu of the word unusual in a consideration of this subregulation. The question is always whether the occurrence was unusual.

187 Not only must the occurrence be unusual, that unusual occurrence must also cause an unusual level of need for professional attendances. An unusual level of need must be a level which is out of the ordinary or indeed, again, exceptional. The deemed ‘exceptional circumstances’ in reg 11(a) are circumstances which would ordinarily be considered to be exceptional circumstances because two unusual circumstances must operate together , the second being consequent upon the first.

188 Therefore, if a particular set of circumstances prevailed over the whole of the period under consideration and operate, for example, on all of the particular days under consideration within that relevant period, it would be hard to say that those circumstances are exceptional, unusual or out of the ordinary. That must be so because there must not only be an unusual occurrence but that must itself cause an unusual level of need for professional services.

189 It is hard to think of a set of circumstances which are unusual which would operate over the relevant period and on 20 or more days during that period, especially where the relevant period might be as long as one year. If the occurrence operated over the whole of the period and on all of the particular days, it might be said that those circumstances are usual. That is not to say that reg 11(a) can never operate if the unusual occurrence operates to cause the unusual level of need during the whole of the period, but it is difficult to think of circumstances in which it would apply.

190 Therefore, for the operation of reg 11(a), ordinarily it will ordinarily be a single event which pertains to a particular day or particular days which operates to allow the decision-maker to conclude that, in respect of that particular day or particular days, there was an unusual occurrence which caused an unusual level of need for professional services.

191 Regulation 11(a) is deemed by s 106KA(5) to be circumstances that amount to exceptional circumstances. As has already been shown, a practitioner may argue that exceptional circumstances exist without relying upon reg 11. That is permissible: s 106KA(5). The practitioner may simply claim that circumstances other than those contained in reg 11 are exceptional circumstances. That being so, the circumstances in reg 11(a) must be something other than the exceptional circumstances predicated in s 106KA(2). If it were otherwise, there would be no need for reg 11(a).

192 Once the general practitioner has established the circumstances in reg 11(a), the next question for the decision-maker, in this case the Committee, is whether the unusual occurrence which has caused an unusual level of need for professional attendances ‘affected the rendering or initiating of services by the [general practitioner]’: s 106KA(2).

193 It is always a two step inquiry. First, whether reg 11(a) has been made out and, secondly, whether those circumstances affected the rendering or initiating of services by the general practitioner on the particular day or days identified by the Committee which form part of the prescribed pattern of services in s 106KA(1).

194 In conducting the second stage of the inquiry the Committee will consider the affect on the rendering and initiating of services by the practitioner in the same way as previously advised. The reg 11(a) circumstances need not be dominant. Other circumstances which affect those matters will only be relevant if they are to exclude the reg 11(a) circumstances from affecting those matters.

195 Different considerations apply in relation to Regulation 11(b).

196 Regulation 11(b) recognises that a medical practitioner may have to render a greater number of services than usual because of an absence of medical services for that medical practitioner’s patients during the relevant period, because of the location of the medical practitioner’s practice and the characteristics of the medical practitioner’s patients. (Emphasis added.)

197 Regulation 11(a) requires an examination of an unusual occurrence causing an unusual level of need for professional attendances on the particular day or days which are found to be relevant for the purpose of the prescribed pattern of services in s 106KA(1).

198 Section 106KA(2) requires an inquiry into whether, on a particular day or particular days during the relevant period, exceptional circumstances existed. That again is directed to the particular day or days.

199 Regulation 11(b), however, directs the inquiry into the absence of other medical services for the general practitioner’s patients ‘during the relevant period’.

200 The relevant period is the period referred to in s 106KA(1), which is the whole of the period being the period up to 12 months over which the prescribed pattern of services is said to have occurred. In this case, the relevant period is from 24 January 2000 to and including 8 August 2000.

201 The inquiry in reg 11(b) is in relation to the whole of the period under review, not simply the particular day or days. However, because the purpose of assessing exceptional circumstances is to determine whether any of the days which otherwise perform part of the prescribed number of days under s 106KA(1) should not be reckoned, in the end result, the inquiry under reg 11(b), although over the whole period, must relate to the particular day or days.

202 Thus it is easier to envisage circumstances which would prevail for the whole of the year which would come within reg 11(b).

203 For example, the general practitioner might practise in a remote country area which cannot attract any other general practitioners for the whole period under investigation. If that is so, the general practitioner has, without more, satisfied reg 11(b) to the extent that he or she has established an absence of other medical services for patients of that general practitioner during the relevant period, having regard to the location of that general practitioner’s practice. If the general practitioner can also establish that the characteristics of his or her patients has impacted upon the absence of other medical services then the general practitioner will have made out that exceptional circumstances exist. Therefore, it seems to me that it is possible that the circumstances contemplated in reg 11(b) could operate over the whole of the period and still be exceptional circumstances because, as I have said, reg 11(b) deems those circumstances to be exceptional. Whilst those circumstances might exist over the whole period, the question for the decision-maker is still whether they operated on the particular day or days which have been reckoned as determining the pattern of services.

204 Regulation 11(b) will not operate unless both criteria in placita (i) and (ii) are made out. Both placita (i) and (ii) must be satisfied because it is the absence of medical services, having regard to the criteria in the placita, which is relevant. Both must be satisfied because of the use of the word ‘and’ between the placita. The circumstances in one placitum might be significantly more relevant than the other but, in the end, both must be operating as a cause for the absence of medical services for the general practitioner’s patients. Those criteria do not need to be addressed unless the general practitioner, who has the onus of establishing the ‘exceptional circumstances’, can first satisfy the decision-maker that there is an absence of other medical services, that is apart from his or her own, for his or her patients. It is not an absence of other medical services for any other patients of any other general practitioner, but an absence of medical services for the particular general practitioner’s patients.

205 The absence of those medical services must arise as a result of the location of the general practitioner’s practice and the characteristics of the medical practitioner’s patients.

206 Subject to the qualification already mentioned in relation to the ‘relevant period’, a consideration of reg 11(b) involves a consideration of its operation in relation to a particular day or particular days. That must be so because the deemed inappropriate practice in s 106KA(1) operates as a result of a consideration of particular days on which 80 or more services were rendered. Thus it is that a medical practitioner must prove the absence of medical services for his or her patients for the reasons mentioned in reg 11(b) on those particular days which have been identified for the purpose of the deeming provision in s 106KA(1).

207 Regulation 11 by force of s 106KA(5) describes two different circumstances which may be described as ‘exceptional circumstances’. A medical practitioner therefore does not, in relying upon reg 11(b), have to make out that those circumstances which come within reg 11(b) are themselves exceptional circumstances. They are exceptional circumstances because reg 11(b) says so and, if they are made out, that is enough.

208 If the general practitioner can establish that there was an absence of medical services for the general practitioner’s patients for the reasons in reg 11(b) during the relevant period the practitioner must then establish that that absence affected the general practitioner’s rendering or initiating of services. The Committee will proceed on that inquiry as it would on the ‘exceptional circumstances affect’ inquiry or the ‘Regulation 11(a) affect inquiry’. The ‘affect’ again need not be dominant. The general practitioner must merely establish that there was an ‘affect’.

209 Other matters affecting the rendering or initiating of services will only be relevant if they constituted the only matters affecting the rendering or initiating of services to the exclusion of the absence of medical services of the general practitioner’s patients.

210 The medical practitioner, in relying upon reg 11(b), does not have to establish that the circumstances in reg 11(b) are exceptional. They are exceptional if they are made out because, as I have said, reg 11(b) makes them so.

211 Whether or not, ordinarily, anyone else would think those circumstances are exceptional is not to the point.

212 The primary judge said:

‘215 Committee 298 thought that the meaning of "exceptional circumstances" was unclear. It seemed to the Committee that s 106KA(2) limited the type of circumstances which would be exceptional to those which were of an episodic or intermittent nature whereas Reg 11(b) seemed to include events of an ongoing nature. It sought to resolve this apparent ambiguity by reference to extrinsic material. This led it to the view that exceptional circumstances would ordinarily be intermittent and that it would be "difficult to justify" circumstances of an ongoing nature.’

213 Later, he said:

‘220 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).’

214 He also found:

‘223 The Committee found that the matters put forward by Dr Oreb, which included the location of his practice and the characteristics of his patients, were foreseeable and did not constitute exceptional circumstances. The question of whether there were exceptional circumstances was a question of mixed fact and law, but it seems to me that Committee 298 reached its conclusion on the basis of its incorrect interpretation of the "exceptional circumstances" provision. That is to say it approached its finding on the basis that Dr Oreb had a heavier onus of satisfying the Committee in relation to ongoing circumstances than in a case of an episodic or unusual event.’

215 In my opinion, the primary judge’s decision was correct.

216 A Professional Services Review Committee which is charged with the obligation of considering whether the medical practitioner has engaged in inappropriate practice by conduct constituting a pattern of services under s 106KA(1) should approach the matter by first considering whether or not there was a prescribed pattern of services of the kind prescribed in reg 10.

217 If the Professional Services Review Committee finds that the medical practitioner has during the relevant period rendered or initiated services which constitute a prescribed pattern of services in that, in the case of a general practitioner he or she has rendered services that are professional attendances of more than 80 on 20 or more days, then the Professional Services Review Committee must consider whether any of those days should not be reckoned because exceptional circumstances existed.

218 If the Professional Services Review Committee reaches such a conclusion, and if the medical practitioner asserts that on a particular day or particular days on which 80 or more services were rendered or initiated there were exceptional circumstances in existence, the Professional Services Review Committee must turn to consider that question.

219 If the medical practitioner does not rely upon reg 11 but simply relies upon circumstances which the medical practitioner says are exceptional circumstances, then an inquiry must be made into those circumstances to see whether they are exceptional in the sense as I have described it.

220 If, on the other hand, the general practitioner relies upon either or both of the paragraphs of reg 11 an inquiry must be had to determine whether the circumstances fit the description of the circumstances in either of those paragraphs.

221 That means that the Committee will have to determine whether the circumstances which have been adduced by the medical practitioner constitute an unusual occurrence causing an unusual level of need for professional attendances or, separately, whether the circumstances adduced show an absence of other medical services for the general practitioner’s patients during the relevant period having regard to the location of the general practitioner’s practice and the characteristics of the general practitioner’s patients.

222 As I have already said, it is not necessary, if the general practitioner is relying upon reg 11, for the general practitioner to establish exceptional circumstances. All the general practitioner must do is establish that the circumstances relied upon come within either paragraph (a) or (b).

223 If the general practitioner can make out that exceptional circumstances existed or that an unusual occurrence causing an unusual level of need for professional services existed or that there was an absence of other medical services for the general practitioner’s patients during the relevant period because of the location of the general practitioner’s practice and the characteristics of the general practitioner’s patients, then the Committee must next consider whether, whichever of the three different circumstances has been relied on and established by the general practitioner affected the general practitioner’s rendering or initiating of services. In carrying out that aspect of its inquiry the Committee will need only to be satisfied that the rendering or initiating of services was affected.

224 If the Committee is satisfied that one of those three different circumstances did affect the rendering or initiating of services by the general practitioner, then the Committee must next consider whether the circumstances did so on a particular day or days which have been identified by the Committee as being the day or days which constituted the prescribed pattern of services in s 106KA(1).

225 In this case, in my opinion, the primary judge was right to conclude that the Committee did not ask itself the right question. The question that the Committee asked itself was whether or not exceptional circumstances existed.

226 Clearly, the medical practitioner was relying upon paragraph (b) of reg 11. In those circumstances, he did not need to establish that there were exceptional circumstances. He had to establish that there was an absence of other medical services for his patients during the relevant period and that was due to the location of his practice and the characteristics of his patients.

227 In my opinion, the primary judge was right to conclude that the Professional Services Review Committee 298 fell into error.

228 In its findings, the Committee refers from time to time to circumstances which, in the Committee’s opinion, were foreseeable. It argues that because circumstances are foreseeable they could not be unusual or exceptional circumstances.

229 In my opinion, that reasoning demonstrates error in two respects. First, whether the circumstances are foreseeable or not is not relevant in a consideration of a case advanced under reg 11(b).

230 If the general practitioner relies upon reg 11(b), what needs to be addressed is whether there is an absence of other medical services for the general practitioner’s patients. No other onus apart from proving placita (i) and (ii) of reg 11(b) is cast upon the general practitioner. The general practitioner does not have the obligation of establishing that he has made attempts to find other medical services for his or her patients.

231 The first inquiry is to determine objectively whether there is an absence of other medical services for the general practitioner’s patients.

232 If that is determined, the further inquiry must be into the reason or reasons for the absence of other medical services and if the two reasons in reg 11(b) are made out then the burden falling upon the general practitioner is discharged if the matters established and affected the general practitioner’s rendering or initiating of services on any particular day or particular days which form part of a pattern of services under s 106KA(1).

233 For those reasons, the Committee was wrong to categorise s 106KA(2) and reg 11 as only applying to episodic events. For the reasons I have given, the exceptional circumstances in s 106KA(2) must be different to the circumstances in reg 11(a) which, in turn, are different from the circumstances in reg 11(b).

234 It is not possible to categorise all three circumstances as ‘exceptional circumstances’ which require proof of episodic events. In my opinion, ‘foreseeable circumstances’ has no application to an inquiry under reg 11(b).

235 Secondly, if the general practitioner is relying upon reg 11(a), and even if a circumstance is foreseeable, that does not necessarily mean that the circumstance is not unusual. A circumstance may be unusual in that it is out of the ordinary, even though it is foreseeable. A circumstance may be exceptional even though it is foreseeable. It is exceptional because it is out of the ordinary, not because it is not foreseeable. In my opinion, an inquiry into the foreseeability of the circumstances adduced by the general practitioner is only likely to lead to error as it has in this case.

236 The inquiry should be into whether the particular circumstances relied upon by the general practitioner are exceptional (s 106KA(2)) or, alternatively, unusual (reg 11(a)).

237 That leaves one further matter and that relates to the orders made by the primary judge on 29 April 2005.

238 The respondents/cross-appellants argued that even if the cross-appeal on the substantive matter were dismissed, the orders made by the primary judge on 29 April 2005 should be set aside.

239 It was argued that in lieu thereof, there should be an order remitting the matter to Professional Services Review Committee 298 for further consideration according to law.

240 Dr Oreb argued that this Court should not set aside the order made by the primary judge on 29 April 2005 because it had been entered in circumstances where the respondents/cross-appellants had consented to the order being made.

241 The orders which were made by the primary judge on 29 April 2005 were as a result of the notice of motion brought by the respondents/cross-appellants on 5 April 2005.

242 In that notice of motion the respondents/cross-appellants sought alternative orders.

243 The first order sought is the order which the respondents/cross-appellants say should have been made by the primary judge on 29 April 2005 and which they say ought to be made by this Court on this cross-appeal.

244 In support of their notice of motion, their solicitor’s affidavit directed the primary judge’s attention to a latent ambiguity in the orders made by the primary judge on 30 November 2004 and the two possible orders that the primary judge may have had in mind. Those two possible orders were the alternative orders sought in the notice of motion.

245 It was as a result of that notice of motion and that affidavit that the primary judge’s associate wrote the e-mail in [8] of these reasons.

246 In my opinion, the respondents/cross-appellants could reasonably have thought that when the primary judge made the orders on 30 November 2004 he had in mind an order of the kind mentioned in that e-mail, which was the alternative order raised on the notice of motion. The respondents/cross-appellants could have reasonably thought that the primary judge had applied his mind to the orders and decided to make an order of the kind mentioned in that e-mail. In my opinion, it is clear that the consent given by the respondents/cross-appellants was given in circumstances where they believed that the primary judge was intending to make the orders. They allowed that to occur to facilitate the issue whether the matter should go back to a Committee comprised of the same members or some other members being raised on this appeal.

247 The respondents/cross-appellants never consented to or agreed that the order proposed to be made by the primary judge was appropriate. They simply allowed it to happen when the primary judge indicated that the order would be made.

248 In my opinion, that order should be set aside. There was nothing, in my opinion, before the primary judge, which meant that the Professional Services Review Committee 298 could not reconsider this matter. There was no suggestion of bias or any apprehension of bias. The error that was made by the Professional Services Review Committee 298 was simply in its construction of the Act and the Regulations.

249 That should not disqualify the Committee from considering the matter afresh in accordance with the reasons of this Court.

250 In my opinion, paragraph 2 of the orders made on 30 November 2004 and paragraph 1 of the orders made on 29 April 2005 should be set aside. In lieu thereof, there should be an order:

‘The matter be remitted to the first respondent for determination of Adjudicative Referral No. 298 according to law.’

251 Otherwise, both the appeal and the cross-appeal should be dismissed.

252 The parties have not been heard on the question of costs. The appellant has failed on the appeal. The respondent has succeeded on the cross-appeal but only to the extent that the order for remitter is varied. I suggest that the costs of the appeal and the cross-appeal be reserved. If any party seeks an order for the costs of the appeal or cross-appeal then within 21 days an application should be made in writing setting out the terms of the order or orders sought. The application should be accompanied by a written submission in support of the application. If any such application is made any other party to the appeal or cross-appeal should file any submission in opposition to that application within a further 14 days. I propose the following orders:

1. The appeal be dismissed.
2. The cross-appeal be allowed.
3. Paragraph 2 of the orders made by Jacobson J on 30 November 2004 and paragraph 1 of the orders made on 29 April 2005 be set aside.
4. In lieu thereof, there be an order that:
‘The matter be remitted to the first respondent to determine Adjudicative Referral No. 298 according to law.’
5. The question of the costs of the appeal and cross-appeal be reserved.
6. Liberty to the parties to apply for an order for the costs of the appeal and cross-appeal in accordance with the directions in Lander J’s reasons.

I certify that the preceding two hundred and thirty-four (234) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Lander.

Associate:

Dated: 16 September 2005

Counsel for the Appellant:	Mr M Robinson, Mr C Jackson
Solicitors for the Appellant:	Tress Cox Lawyers
Counsel for the Respondents:	Mr P Hanks QC, Ms R M Henderson
Solicitors for the Respondents:	Minter Ellison
Date of Hearing:	10 May 2005
Date of Judgment:	16 September 2005