Gauchito Pty Ltd and Minister for Health and Ageing [2009] AATA 39; (2009) 49 AAR 333 (21 January 2009)

Last Updated: 3 November 2010

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2009] AATA 39

ADMINISTRATIVE APPEALS TRIBUNAL )

) No 2008/4852

GENERAL ADMINISTRATIVE DIVISION		)
	Re		GAUCHITO PTY LTD

Applicant

And

MINISTER FOR HEALTH AND AGEING

Respondent

DECISION

Tribunal

Deputy President P E Hack SC

Date 21 January 2009

Place Brisbane

Decision

The Tribunal dismisses the application pursuant to s 42A(4) of the Administrative Appeals Tribunal Act 1975 (Cth).

...............Signed................
Deputy President

CATCHWORDS

PRACTICE & PROCEDURE – jurisdiction of the Tribunal – no decision made for which the relevant statute allows appeal to the Tribunal – no decision capable of being reviewed – application is dismissed pursuant to s 42A(4) of the Administrative Appeals Tribunal Act 1975

Administrative Appeals Tribunal Act 1975 (Cth) – s42A(4)

Hearing Services Administration Act 1997 (Cth) – ss 17, 18, 20, 29, 32

Hearing Services Rules of Conduct 2005 – rule 14(1)

Griffith University v Tang [2005] HCA 7; (2005) 221 CLR 99

REASONS FOR DECISION

21 January 2009

Deputy President P E Hack SC

INTRODUCTION

1. The Hearing Services Administration Act 1997 (Cth) sets up a scheme whereby “hearing services” – goods and services for the purposes of hearing rehabilitation, hearing assessment and hearing loss prevention – are provided to eligible recipients by “accredited service providers” at the expense of the Commonwealth.
2. There are certain decisions of the Minister for Health and Ageing (or her delegate) under that Act that may be the subject of review in the Tribunal. The contest here is whether the decision in issue in the present case, a decision to cancel a contract to provide hearing services, is one capable of being reviewed. The applicant, Gauchito Pty Ltd, says that it is; the Minister contends to the contrary.

THE LEGISLATION

3. Division 2 of Part 3 of the Act enables the Minister to establish an “accreditation scheme” to accredit hearing professionals who wish to provide hearing services to persons eligible to receive those services under the Act. Accreditation may be made subject to conditions.
4. Section 17 of the Act, within the same Division, requires the Minister to formulate rules of conduct relating to the provision of hearing services to eligible recipients, called “voucher-holders”. Sub-section 17(2) provides that the rules of conduct “have effect only for the purposes of section 18”. That latter section makes it a condition of accreditation of an entity “that the entity must comply with the rules of conduct”.
5. The Hearing Services Rules of Conduct 2005 contain, essentially, two parts – rules about “providing hearing services” and rules about “qualifications”. In the former category is rule 14(1), said to have relevance in the present case. It provides:

“(1) A contracted service provider must, in relation to the provision of hearing services to a voucher-holder:

(a) exercise reasonable care for the voucher-holder’s safety with respect to the environment, premises, the hearing services and the procedures used; and

(b) ensure the hearing services it provides meet the voucher-holder’s needs and are complete; and

(c) exercise professional judgment; and

(d) have due regard to the voucher-holder’s individual requirements and identified hearing impairment; and

(e) provide the hearing services in accordance with the outcomes document.”

6. Sub-section 20(1) of the Act empowers the Minister, on behalf of the Commonwealth, to:

“engage an accredited service provider to provide hearing services to voucher-holders ...”

A provider so engaged is called a “contracted service provider”. Succeeding sub-sections require that the terms and conditions of the engagement be set out in a written agreement. Those terms and conditions must be consistent with the accreditation scheme and the rules of conduct[1]. Each condition of the accreditation of the contracted service provider is taken to be a condition of the engagement[2].

7. Part 5 of the Act deals with the review of decisions. Section 29 of the Act lists the decisions that may be subject to reconsideration by the Minister in these terms:

“(a) a decision by the Minister refusing to issue a voucher to a participant in the voucher system;

(b) a decision made by the Minister under the voucher rules;

(c) a decision made by the Minister under the accreditation scheme;

(d) a decision made by the Minister under a condition of accreditation;

(e) a decision made by the Minister under the rules of conduct;

(f) a decision of the Minister made under section 19 (which deals with disqualification for fraud, dishonesty etc.).”

8. A person affected by a decision of the kind referred to in s 29 of the Act may apply to the Minister to reconsider the decision[3] and the Minister, upon receipt of a request to reconsider, must reconsider the decision and affirm, vary or revoke the decision[4]. Application may be made to the Tribunal to review a decision of a kind referred to in s 29 of the Act if the Minister has affirmed or varied the decision under s 32 of the Act.

BACKGROUND

9. Gauchito is an accredited service provider. On 20 June 2007 Gauchito and the Commonwealth entered into a written agreement that complied with s 20 of the Act. On or after 10 July 2008 Gauchito received a letter advising that for reasons set out in the letter a delegate of the Minister had “decided to terminate the contract effective from 5pm, Friday 11 July 2008”. The letter informed Gauchito that the decision-maker was satisfied that Gauchito had not complied with clause 8 of the contract. Reference was then made to the requirement of clause 8 of the contract that Gauchito:

“is to exercise skill, care and diligence in providing the Services and is to ensure that the Services meet their purpose, are complete and are performed in a manner that achieves all standards of performance included in or referred to in this Contract.”

Matters were then listed that seemingly demonstrated to the decision-maker that Gauchito had not complied with that requirement. I am not required to consider whether that conclusion was warranted.

10. These proceedings were commenced on 13 October 2008 when Gauchito lodged an application to review the decision of 10 July 2008 and the “deemed decision” of the Minister. The Minister put in issue the jurisdiction of the Tribunal, contending that the decisions identified were not decisions capable of being reviewed.

THE CASE FOR GAUCHITO

11. Mr Hume, counsel for Gauchito, accepted, as I understood him, that the decision of 10 July 2008 was not a reviewable decision. The argument he advanced was that the decision to cancel the contract “was the end product of a decision necessarily made under the conduct rules”, i.e. a decision of the type specified in s 29(e) of the Act. The argument was that it was implicit in the fact that the cancellation decision had been made that there had been an antecedent decision that Gauchito had failed to comply with the conduct rules and that that decision was one “under” those rules. Rule 14(1) was identified in the argument as the rule in respect of which a decision had been made.
12. It was said, as well, that s 29 of the Act was intended to “cover the field in respect of the delivery of services under the Act”.

CONSIDERATION

13. I am unable to accept the argument for Gauchito. The starting point is, of course, that the Tribunal exercises no general jurisdiction; it has jurisdiction only where an enactment makes provision for an application to the Tribunal. Section 29 of the Act is such a provision; however, I am of the view that there is no decision in the present case, either express or implicit, that answers the description in s 29 of the Act.
14. It is obvious that the decision-maker made a decision about the conduct of Gauchito that preceded the decision to terminate the contract. If, in truth, that decision was a reviewable decision it would not be of any consequence that the decision-maker did not identify it as such. Given that Gauchito relies only on s 29(e) of the Act, the questions that arise are what that decision was and whether that decision was one made “under the rules of conduct”.
15. It is necessary, for the purposes of determining what the antecedent decision was, to consider the letter of 10 July 2008 from the decision-maker, the Acting Manager of the Office of Hearing Services (part of the Department of Health and Ageing) to Gauchito. The letter read, in part[5]:

“Clause 31.3 of the Contract provides that where the Service Provider breaches any fundamental term, the Commonwealth may terminate the Contract by notice in writing with effect on and from the date specified in the notice.

As set out in clause 31.1 of the Contract, clause 8 of the Contract is a fundamental term of the Contract. I am satisfied that you have not complied with clause 8 of the Contract in relation to Service Provider Warranties. I draw your attention to the following:

• Under clause 8.1(a) and 8.1(b) of the Contract the Service Provider is to exercise skill, care and diligence in providing the Services and is to ensure that the Services meet their purpose, are complete and are performed in a manner that achieves all standards of performance included in or referred to in this Contract.
• Reviews of your files show that complete audiometric assessments were not performed in many instances, for example:
  • incorrect masking was applied in the case of ... on 4 May 2006 and ... on 20 September 2007;
  • hearing aids have been fitted using inappropriate measures and incorrect targets, for example, aids fitted on 8 October 2007 and finalised on 17 October 2007 on ... and aids fitted on ... on 19 October 2007 and finalised on 26 October 2007;
  • insufficient grounds have been provided for refitting of hearing aids in the case of ... aids fitted on 21 June 2007 and finalised on 12 July 2007, and ... aids fitted on 8 October 2007 and finalised on 17 October 2007.

Further examples of incomplete audiometric assessments are provided in Attachment A to this letter.

• The broad omissions and actions described above do not meet the standards expected of an audiologist and reflects a lack of skill, care and diligence, which has the potential to seriously jeopardise the health and wellbeing of clients.”

16. Gauchito says of the letter that:

“...a careful analysis of the words used in all three dot points clearly enliven [sic] the Rules of Conduct, particularly Rule 14 relating to Professional Standards. It should be noted, that only one of these dot points, (the first) relates to a clause in the contract.

Clearly then, termination of the contract is based on other considerations besides the breach of a so-called, fundamental term of the contract. These considerations can only be terms of the Rules of Conduct.”

17. I do not agree. I see no reason to go beyond the plain words of the letter that set out the decision-maker’s view that Gauchito had breached the contractual requirement to exercise skill, care and diligence. The content of rule 14, set out in paragraph [5] above, is quite different. The Act, by s 20, empowers the Minister to contract for the provision of services. The contract must set out the terms and conditions of the engagement which must be “consistent with” the accreditation scheme and the rules of conduct. Here, I see no reason to doubt that the operative decision, evidenced by the letter of 10 July 2008, was that Gauchito had breached the terms of the contract. I do not read the letter as demonstrating a conclusion by the decision-maker that Gauchito had breached the rules of conduct.
18. But beyond that, and even had I concluded that the decision-maker had expressly or impliedly decided that Gauchito had breached the rules of conduct, I am not satisfied that such a decision was one “under the rules of conduct”.
19. There is considerable jurisprudence on the expression “under an enactment” as it is used in s 3(1) of the Administrative Decisions (Judicial Review) Act 1977 (Cth). Given the analogous context it is helpful to consider what was said in Griffith University v Tang[6] about the meaning of “a decision ... made under an enactment”. The following observations of the majority are apposite here. Their Honours said[7]:

“[82] For these reasons, a statutory grant of a bare capacity to contract does not suffice to endow subsequent contracts with the character of having been made under that enactment. A legislative grant of capacity to contract to a statutory body will not, without more, be sufficient to empower that body unilaterally to affect the rights or liabilities of any other party. The power to affect the other party's rights and obligations will be derived not from the enactment but from such agreement as has been made between the parties. A decision to enter into a contract would have no legal effect without the consent of the other party; the agreement between the parties is the origin of the rights and liabilities as between the parties.

...

[89] The determination of whether a decision is ‘made ... under an enactment’ involves two criteria: first, the decision must be expressly or impliedly required or authorised by the enactment; and, secondly, the decision must itself confer, alter or otherwise affect legal rights or obligations, and in that sense the decision must derive from the enactment. A decision will only be ‘made ... under an enactment’ if both these criteria are met. It should be emphasised that this construction of the statutory definition does not require the relevant decision to affect or alter existing rights or obligations, and it will be sufficient that the enactment requires or authorises decisions from which new rights or obligations arise. Similarly, it is not necessary that the relevantly affected legal rights owe their existence to the enactment in question. Affection of rights or obligations derived from the general law or statute will suffice.”

20. Considered by reference to this test a decision that Gauchito had breached the rules of conduct does not satisfy either of the two criteria. The rules of conduct did not expressly or impliedly require or authorise the making of a decision that those rules had been breached. Moreover, such a decision could not, of itself, confer, alter or otherwise affect legal rights or obligations between Gauchito and the Commonwealth. Those rights were affected by the decision made to terminate the contract.
21. It follows that in my opinion there is no decision made “under the rules of conduct” and, accordingly, no decision capable of being reviewed. I would thus dismiss the application made by Gauchito on the basis that there is no jurisdiction to review the decision sought to be reviewed.

I certify that the 21 preceding paragraphs are a true copy of the reasons for the decision herein of Deputy President P E Hack SC

Signed: .........................Signed.........................................

Jacqueline Woods, Associate

Date of Hearing 18 December 2008

Final submissions received 19 December 2008

Date of Decision 21 January 2009

Counsel for the Applicant Mr RWG Hume

Solicitors for the Applicant Stockley Furlong

Solicitor for the Respondent Department of Health and Ageing

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[1] See s 20(2) of the Act.
[2] See s 20(3) of the Act.
[3] See s 31(1) of the Act
[4] See s 32(1) of the Act.

[5] References to customers’ names have been deleted.

[6] [2005] HCA 7; (2005) 221 CLR 99. Although concerned with the Judicial Review Act 1991 (Qld), s 4 of that Act imported the definition of “decision” from the Commonwealth statute.
[7] [2005] HCA 7; 221 CLR 99 at [82] and [89].