Wong v Australian Community Pharmacy Authority [2011] FCA 52 (7 February 2011)

Last Updated: 8 February 2011

FEDERAL COURT OF AUSTRALIA

Wong v Australian Community Pharmacy Authority [2011] FCA 52

Citation:		Wong v Australian Community Pharmacy Authority [2011] FCA 52
Parties:		SHUI SU WONG v AUSTRALIAN COMMUNITY PHARMACY AUTHORITY, SECRETARY OF THE DEPARTMENT OF HEALTH AND AGEING and ROBERT PEARSON
File number:		WAD 129 of 2010
Judge:		SIOPIS J
Date of judgment:		7 February 2011
Catchwords:		ADMINISTRATIVE LAW – whether pharmacist whose economic interest would be affected by the recommendation of the Australian Community Pharmacy Authority that another pharmacist be approved to supply pharmaceutical benefits, is entitled to be accorded procedural fairness in relation to the decision to make the recommendation - whether the Authority failed to take into account a relevant consideration – whether the decision of the Authority to make the recommendation was unreasonable.
Legislation:		National Health Act 1953 (Cth) s 90 Administrative Decisions (Judicial Review) Act 1977 (Cth) s 13 Judiciary Act 1903 (Cth) s 39B National Health (Australian Community Pharmacy Authority Rules) Determination 2006 Sch 1 Pt 1 rule 107
Cases cited:		Martin v Pharmacy Restructuring Authority (1994) 34 ALD 534 Pharmacy Restructuring Authority v Martin (1994) 53 FCR 589 Loveridge v Pharmacy Restructuring Authority (1995) 39 ALD 103 The Pharmacy Guild of Australia v Australian Community Pharmacy Authority (1996) 46 ALD 310 Wood v Australian Community Pharmacy Authority [2001] FCA 1592 WAEE v Minister for Immigration and Multicultural and Indigenous Affairs (2003) 75 ALD 630
Date of hearing:	15 September 2010
Place:	Perth
Division:	GENERAL DIVISION
Category:	Catchwords
Number of paragraphs:	100
Counsel for the Applicant:	Mr SA Glacken SC and Ms RJ Lee
Solicitor for the Applicant:	Gadens Lawyers
Counsel for the First and Second Respondents:	Mr PR Macliver
Solicitor for the First and Second Respondents:	Australian Government Solicitor
Counsel for the Third Respondent:	Mr GS Clarke SC and Mr D Feinauer
Solicitor for the Third Respondent:	Feinauer

IN THE FEDERAL COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION	WAD 129 of 2010

BETWEEN:	SHUI SU WONG Applicant
AND:	AUSTRALIAN COMMUNITY PHARMACY AUTHORITY First Respondent SECRETARY OF THE DEPARTMENT OF HEALTH AND AGEING Second Respondent ROBERT PEARSON Third Respondent

JUDGE:	SIOPIS J
DATE OF ORDER:	7 FEBRUARY 2011
WHERE MADE:	PERTH

THE COURT ORDERS THAT:

1. The applicant’s application dated 20 May 2010, is dismissed.
2. The applicant is to pay the respondents’ costs.
3. The third respondent has liberty to apply in respect of costs.
   

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
The text of entered orders can be located using Federal Law Search on the Court’s website.

IN THE FEDERAL COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION	WAD 129 of 2010

BETWEEN:	SHUI SU WONG Applicant
AND:	AUSTRALIAN COMMUNITY PHARMACY AUTHORITY First Respondent SECRETARY OF THE DEPARTMENT OF HEALTH AND AGEING Second Respondent ROBERT PEARSON Third Respondent

JUDGE:	SIOPIS J
DATE:	7 FEBRUARY 2011
PLACE:	PERTH

REASONS FOR JUDGMENT

1. In 2005, Mr Wong, the applicant in this case, obtained approval from the Secretary of the Department of Health and Ageing, the second respondent, under s 90(1) of the National Health Act 1953 (Cth), to supply pharmaceutical benefits from premises located at 35 George Street, Pinjarra. Until 28 May 2010, Mr Wong was the only pharmacist to have obtained approval to supply pharmaceutical benefits from premises in Pinjarra and he operated the only pharmacy in Pinjarra. However, on 3 May 2010, the Australian Community Pharmacy Authority (the Authority), the first respondent, a statutory authority exercising powers under the National Health Act, recommended to the second respondent, the Secretary, that the application made by another pharmacist, Mr Robert Pearson, the third respondent, to provide pharmaceutical benefits from another premises in Pinjarra, namely, 27 Forrest Street, be approved. On 28 May 2010, a delegate of the Secretary approved Mr Pearson’s application, adopting the recommendation of the Authority.
2. In this proceeding, Mr Wong challenges the lawfulness of both the decision of the Authority to recommend the approval of Mr Pearson’s application, and the approval decision of the delegate of the Secretary.

BACKGROUND

3. Section 90(1) of the National Health Act relevantly provides:
   90. Approved pharmacists
       

(1) Subject to this section, the Secretary may, upon application by a pharmacist for approval to supply pharmaceutical benefits at particular premises, approve that pharmacist for the purpose of supplying pharmaceutical benefits at those premises.

4. Section 90(3A) provides that an application made by a pharmacist under that section, must be referred to the Authority. Section 90(3B) provides that an approval may be granted by the Secretary only if the Authority has recommended the grant of the approval, but the Secretary may refuse to grant an approval even if the grant has been recommended by the Authority.
5. Section 99K of the National Health Act describes the functions of the Authority. It states:

99K Functions

(1) The functions of the Authority are:

(a) to consider applications under section 90; and

(b) to make, in respect of an application under section 90:

(i) a recommendation whether or not the applicant should be approved under that section in respect of particular premises; and

(ii) if an approval is recommended – recommendations as to the conditions (if any) to which the approval should be subject; and

(2) In making a recommendation under subsection (1), the Authority must comply with the relevant rules determined by the Minister under section 99L.

(3) All recommendations of the Authority under subsection (1) are to be made to the Secretary.

6. The prescribed requirements referred to in s 99K(2) which are relevant to this proceeding, are in rule 107 of Pt 1 of Sch 1 of the National Health (Australian Community Pharmacy Authority Rules) Determination 2006 (Pharmacy Rules). These requirements apply in relation to the relocation of a pharmacy to a rural locality. The Pharmacy Rules relevantly provide as follows:

107 Relocation to 1. The proposed premises are in a rural locality.
rural locality
(additional 2. The proposed premises are at least 200 m, in a straight Pharmacy) line, from the nearest approved premises.

3. The Authority is satisfied that:

(a) the resident population of the catchment area for the proposed premises is, for most of the year, at least 8 000; and

(b) the number of prescribing medical practitioners practising in the catchment area for the proposed premises is equivalent to at least 4 full-time prescribing medical practitioners; and

(c) the catchment area for the proposed premises contains only 1 approved premises; and

(d) ...

7. There is no definition of the term “catchment area” in the Pharmacy Rules. However, the Authority has published the Pharmacy Location Rules – Applicant’s Handbook, March 2009. Item 4.1 of the handbook provides:

4.1 Defining the catchment area

The catchment area of a pharmacy is considered to be one in which a significant number of people from within an area will naturally and reasonably gravitate or flow to the proposed pharmacy premises.

In considering a catchment area, the [Authority] will take into account matters such as traffic flows, proximity to other services and attractions, geographical features, any natural barriers and distance to the proposed premises.

It should be noted that in areas where there is one or more existing pharmacies, the catchment area of a proposed pharmacy is likely to overlap, to some degree, with those of the existing pharmacies.

8. By a letter dated 21 January 2010, the Authority advised Mr Wong of an application under s 90 of the National Health Act, for approval to supply pharmaceutical benefits from premises located at 53 George Street, Pinjarra, made under rule 107 of the Pharmacy Rules. The Authority’s letter went on to say that if Mr Wong considered the applicant for approval may not satisfy a requirement for approval, Mr Wong should advise the Authority and provide any supporting evidence by 19 February 2010.
9. The letter from the Authority enclosed a document headed: “Things You Should Know”. Included under that heading were the following statements:
   • The [Authority] is not required to seek comments from nearby pharmacists or advise pharmacists that an Application has been made under s 90 of the National Health Act 1953. However, the [Authority] considers that, for most Applications, information from nearby pharmacists with knowledge of the local area may assist it to determine whether the Applicant fully satisfies all of the relevant requirements under the Pharmacy Location Rules.
     
   • The [Authority] cannot guarantee that it will write to all pharmacists who may be affected by an Application; therefore, it may be in your best interests to make sure other pharmacists who might be affected by the proposal are informed about the Application in a timely fashion to give them an opportunity to comment on it.
     
10. On 19 February 2010, Mr Wong’s solicitor sent a letter to the Authority which enclosed a report prepared by Mr Rowe of Greg Rowe & Associates dated 17 February 2010 in relation to the catchment area of the proposed premises.
11. The Greg Rowe & Associates report stated that the catchment area for the proposed pharmacy premises comprised a population of 5,630 persons, less than the 8,000 persons required by the Pharmacy Rules. The report attached a “catchment plan” which reflected a catchment area which comprised a total of 19 Census Collection Districts (the CDs), being districts used in the Australian Bureau of Statistics, 2006 Census of Population and Housing. The report stated:

Summary Conclusion

To conclude the catchment area of the proposed additional Pharmacy is affected by a number of factors principally the Forrest Highway which creates an obstacle or physical limitation to the catchment area identified.

Significant attractor factors also require consideration in the determination of a Catchment Area. The Mandurah and Rockingham Central Business District is likely to attract persons from CD’s west of the Forrest Highway due to the services offered at these Centres, including Pharmacies. In addition, the localities of Mundijong, Jarrahdale and Serpentine, are unlikely to travel south to Pinjarra given the existing pharmacy located to the North in Byford and the various pharmacies and numerous additional services located to the west in the Rockingham and Kwinana CBD’s and surrounds.

12. The report also stated as follows:

In addition, a large proportion of CD 5061808 is dissected by the Forrest Highway and accordingly the proportion of the 242 persons within this CD located to the west of the Forrest Highway, may not utilise the proposed pharmacy and instead travel north to the South Yunderup Pharmacy.

It is further noted that a number of the population located within the CD’s on the western edge of the catchment area, east of the Highway (CD’s 5060110, 5061802 and 5061801) may not be deterred by the limitation that is the Forrest Highway and may see the benefits of utilising the additional services provided within the Mandurah CBD and immediate surrounds as a major attractor. This will result in a further reduction in the population within the catchment area.

13. The Forrest Highway, referred to in the report, is a recently built highway which connects Perth to Bunbury and is located to the east of Mandurah and to the west of Pinjarra.
14. On 26 February 2010, the Authority decided not to recommend approval of the application to supply pharmaceutical benefits from 53 George Street.
15. By a letter dated 5 March 2010, the Authority notified the George Street applicant that it had recommended that the application not be approved because it was not satisfied that the resident population of the catchment area for the proposed premises was, for most of the year, at least 8,000 persons. The Authority went onto advise the applicant:

The Authority determined that the services and attractions at Armadale and Mandurah were superior to those nearby to the proposed premises. The Authority found that due to the road networks and the services and attractions at Armadale and Mandurah and their accessibility, the catchment area for the proposed premises would comprise...a resident population of 6,605.

16. By letter dated 5 March 2010, the Authority advised Mr Wong of its decision not to recommend approval of the application to supply pharmaceutical benefits from premises located at 53 George Street, Pinjarra. The letter stated that the application did not satisfy all the relevant criteria.
17. By another letter dated 5 March 2010, the Authority advised Mr Wong that it had received an application for approval to supply pharmaceutical benefits from premises at 27 Forrest Street, Pinjarra, which had been made under rule 107 of the Pharmacy Rules.
18. The letter went onto state:

If you consider that the Applicant may not satisfy one or more of the requirements and you have, or will have, evidence in support of this, please complete the attached checklist and return it with any supporting evidence to the [Authority] no later than 19 March 2010. (Original emphasis.)

19. Mr Wong’s solicitor responded to that letter by a letter dated 11 March 2010. Mr Wong’s solicitor enclosed the same report by Greg Rowe & Associates, as it had previously sent under cover of Mr Wong’s solicitor’s letter dated 19 February 2010, in respect of the 53 George Street application.
20. The covering letter from Mr Wong’s solicitor stated:

I act on behalf of Shui Su Wong, the proprietor of the Pinjarra Pharmacy.

I refer to your letter of 5 March 2010 addressed to my client seeking his comments concerning an application to establish a Pharmacy at 27 Forrest Street, Pinjarra, Western Australia, pursuant to Rule 107 for the approval of an additional pharmacy in Pinjarra, Western Australia.

As you are aware from previous comments, Mr Wong commissioned Greg Rowe and Associates to report the catchment of the area...

A copy of Mr Rowe’s report is attached. It is dated 17 February 2010. It is highly unlikely the catchment in the relevant area has increased sufficiently to comply with the requirements of Rule 107.

On examination of the SLA Murray (S), much of the population is captured to the West of Pinjarra and therefore is drawn to the far more expansive facilities and attractions of Mandurah, behind a natural boundary of the new Forrest Highway, closer to South Yunderup Pharmacy.

It is therefore reasonable to conclude that the only view of catchment that might include 8,000 persons would include persons located in the Yunderup/Austin Cove area and, were that the case, the catchment would also include more than one other approved pharmacy, namely the South Yunderup Pharmacy.

For these reasons, my client again believes the Authority recommend the application not be approved. (Original emphasis.)

21. In his application in respect of 27 Forrest Street, Pinjarra, Mr Pearson stated, in relation to the catchment area for the proposed premises:

The catchment area for this application is represented by the area of the Shire of Murray with the exclusion of Stake Hill, Baranup, Nembeelup and Furnissdale, North Yunderup and South Yunderup as these areas are closer to Mandurah and on the coastal side of the new Perth-Bunbury highway.

22. At its meeting on 26 March 2010, the Authority deferred consideration of Mr Pearson’s application until its next meeting scheduled for 30 April 2010. By a letter dated 31 March 2010, the Authority asked Mr Pearson to provide further material in relation to the catchment area of the proposed premises.
23. Mr Pearson then obtained a report from Insitu Planning & Design in relation to the catchment area of the proposed premises at 27 Forrest Street, Pinjarra. The Insitu report was prepared by Mr David Jones. Mr Pearson submitted the Insitu report to the Authority on 23 April 2010. At its meeting on 30 April 2010, the Authority considered Mr Pearson’s application and made a recommendation that the application be approved.
24. On 28 May 2010, a delegate of the Secretary approved Mr Pearson’s application to supply pharmaceutical benefits at 27 Forrest Street, Pinjarra.
25. On 8 June 2010, in response to Mr Wong’s request, the Authority provided under s 13(1) of the Administrative Decisions (Judicial Review) Act 1977 (Cth) (the ADJR Act), reasons for its decision to recommend for approval Mr Pearson’s application in respect of the Forrest Street premises. At para 4 of the statement of the Authority’s reasons for decision, the following appears:

On 5 March 2010, the Authority wrote to the Objector, seeking comments on whether the Application met the relevant requirements of the Rules. The Authority received comments on the Application form from Mr Jonathon Meyer, on behalf of the Objector, by letter of 11 March 2010, attaching a report on the catchment area for Pinjarra township prepared by Mr Greg Rowe, of Greg Rowe and Associates, dated 17 February 2010.

26. The reasons for decision also recorded a list of evidence which the Authority considered. Included in that list of evidence is Mr Wong’s solicitor’s letter of 11 March 2010 and the Greg Rowe & Associates report of 17 February 2010.
27. The reasons for decision then recorded the Authority’s findings in respect of each of the required elements referred to in Rule 107 of the Pharmacy Rules.
28. Under the heading “107(3)(a) – The resident population of the catchment area for the proposed premises is, for most of the year, at least 8,000”, the reasons for decision recorded:
    
    22. The Authority considered the “Population Justification Report – 27 Forrest Street, Pinjarra, Western Australia” prepared by Insitu Planning & Design regarding the Applicant’s claimed catchment area, including the A3 map of the claimed catchment area with associated statistical areas, 2010 Forecast ID populations, roads, medical practices, services and attractions and other approved pharmacies superimposed.
        
    23. The Authority considered the comments provided by the Objector, which stated that the Forrest Highway would be a natural boundary. The Authority found that the newly completed Forrest Highway would serve as a barrier to residents to its west in the West Pinjarra Strategic Growth Area.
        
    24. The Authority found that due to the road networks and the services and attractions at Pinjarra and their accessibility, the catchment area for the proposed premises would comprise the Forecast ID statistical areas for the Shire of Murray of Pinjarra, North Dandalup – Rural North, Point Grey, Rural South, Ravenswood North, Ravenswood and the area to the east of the Forrest Highway contained within the West Pinjarra Strategic Growth Area.
        

Resident population

25. The Authority considered the estimated resident population by Forecast ID of the following statistical areas for 2010, contained in the Insitu Planning & Design report for Pinjarra, North Dandalup – Rural North, Point Grey, Rural South, Ravenswood North and Ravenswood and the West Pinjarra Strategic Growth Area.
    
26. The Authority found that the total population of the West Pinjarra Strategic Growth Area was 210 and that the inclusion of half of this population in the catchment area as determined by the Authority was reasonable, given that the Forrest Highway which was found to be a barrier appeared to divide the area in half.
    
27. The Authority found that the resident population of the catchment area was 9,194.
    
28. The Authority was satisfied that the catchment area contains a resident population of at least 8,000 for most of the year.
    
29. In response to Mr Wong’s request, the delegate of the Secretary also provided reasons for the decision of 28 May 2010, under s 13 of the ADJR Act.

MR WONG’S CLAIM FOR JUDICIAL REVIEW

30. On 20 May 2010, Mr Wong commenced this application seeking judicial review of the decision of the Authority to recommend the approval of Mr Pearson’s application. Mr Wong relied on the ADJR Act, and s 39B of the Judiciary Act 1903 (Cth).
31. Mr Wong subsequently amended his application for review to include a review of the second respondent’s decision.
32. Mr Wong’s claim is now set out in a document entitled: “Substituted Application for Review”. Mr Wong relied upon the following grounds of review in relation to the decision made by the Authority:
33. First, Mr Wong contended that in making its recommendation, the Authority failed to have regard to a relevant consideration in identifying the catchment area and its population.
34. Secondly, Mr Wong contended that the Authority was obliged to, but, did not afford Mr Wong procedural fairness, in that it did not give Mr Wong an opportunity to deal with the evidence submitted by Mr Pearson on the catchment area of the proposed premises, nor did it provide Mr Wong with an opportunity to be heard on whether the recommendation should be made.
35. Thirdly, Mr Wong contended that no reasonable authority could have so exercised the power in the manner in which the Authority exercised its power to recommend the approval of Mr Pearson’s application.
36. Mr Wong also impugned the decision of the second respondent on the grounds of denial of procedural fairness.
37. I deal first with Mr Wong’s complaint in respect of the decision of the Authority to recommend Mr Pearson’s application for approval.

WHETHER MR WONG WAS ENTITLED TO BE HEARD

38. Mr Wong contended that he was entitled, as an incident of procedural fairness, to be given a chance to be heard and make submissions in relation to the material considered by the Authority on the relevant catchment area. Mr Wong said that he was denied that opportunity and that, accordingly, the recommendation of the Authority should be set aside because there had been a failure to accord him procedural fairness.
39. Mr Wong contended that his entitlement to be accorded procedural fairness was founded upon the fact that his economic interest would be affected by the Authority's decision because it would lead to another pharmacist operating in competition with Mr Wong in Pinjarra. The introduction of another pharmacist in Pinjarra, said Mr Wong, would have the effect of reducing the revenue earned from his existing pharmacy in Pinjarra. Mr Wong deposed that he estimated that 50% of his business turnover would be lost because of the high number of pensioners, veterans and concession card holders in Pinjarra. Mr Wong also contended that this interest was sufficient to give rise to a right to be heard as an incident of an entitlement to procedural fairness, at common law. The statutory framework, on its proper construction, said Mr Wong, did not provide otherwise.
40. The question of whether a pharmacist whose economic interest may be affected, is entitled to an opportunity to be heard in opposition to the Authority recommending the approval of an application made under s 90 of the National Health Act, as an incident of an entitlement to procedural fairness, has been the subject of a number of decisions in this Court.
41. In the case of Martin v Pharmacy Restructuring Authority (1994) 34 ALD 534, the third respondents carried on business as pharmacists at the corner of Bridge and Joseph Streets in Lidcombe, New South Wales. There were other pharmacists, Ms Martin and Ms Ridgeway who also carried on business in Lidcombe. Their premises were located in John Street. Joseph Street and John Street were adjacent streets which were connected by a railway footbridge. The third respondents applied to the Authority under s 90 of the National Health Act for approval to provide pharmaceutical benefits from premises two doors away from the John Street premises where Ms Martin and Ms Ridgeway carried on business as pharmacists. In effect, the third respondents applied to relocate from premises in Joseph Street to premises in John Street.
42. The guideline which the Authority was required to apply at the time, namely, guideline 3(d), permitted a pharmacist to relocate to premises which were not more than 500 metres “by normal access routes” from their existing premises. The evidence was to the effect that the John Street premises to which the third respondents sought to relocate, were 318.7 metres from their existing Joseph Street premises if measured by walking down the street and over a footbridge, but were more than 600 metres by road from the third respondents’ existing premises in Joseph Street. The Authority recommended the approval of the third respondents’ application and a delegate of the Secretary approved the application.
43. Ms Martin and Ms Ridgeway applied for judicial review of the Authority’s decision under the ADJR Act. They contended that by reason of their economic interest in the Authority’s decision, they were entitled to procedural fairness in relation to the making of the decision to approve the third respondents’ application, and the Authority had failed to accord them procedural fairness. Davies J, at first instance, upheld Ms Martin’s and Ms Ridgeway’s contention, finding that they were persons who were likely to be affected by the decision of the Authority.
44. The Authority appealed to the Full Court. The Full Court (Pharmacy Restructuring Authority v Martin (1994) 53 FCR 589 (Martin)) upheld the Authority’s appeal. In doing so, it set aside the finding of Davies J that Ms Martin and Ms Ridgeway were entitled to procedural fairness in relation to the making of the Authority’s recommendation. At 597, Wilcox J (with whom Foster and Whitlam JJ agreed) observed as follows:

Procedural fairness

Counsel for the first respondents argued that procedural fairness required the Authority to afford their clients a right of hearing before deciding to recommend approval of the application. They cited no authority in support of that submission. Alphapharm Pty Ltd v SmithKline Beecham (Australia) Pty Ltd [1994] FCA 996; (1994) 49 FCR 250 suggests the contrary.

There are cases where a statutory authority, charged with the duty of considering an application to use premises for a particular purpose, is expressly obliged to publicise the receipt of the application and to consider objections. Liquor legislation is a well known example. There are cases where such an obligation is implied by the scope and purpose of the legislation. But we do not know of any general principle to the effect that a statutory authority charged with the duty of considering an application is obliged by the principles of procedural fairness to notify and hear everybody whose economic interests may be damaged by an approval. To promulgate a general rule imposing such an obligation would be to visit upon statutory decision-makers a potentially massive task of indeterminate reference. In the present case, nothing is to be implied from the scope and purpose of the Act. The relevant provisions are not concerned with minimising competition in the pharmaceutical industry but with reducing the Commonwealth’s financial burden in providing pharmaceutical benefits while maintaining an acceptable level of community service. In the absence of authority, we are not prepared to hold that, if it had a discretion about its decision, the Authority had any obligation to notify or hear pharmacists, non-parties to the application for approval, merely because an approval might commercially damage them.

45. In the case of Loveridge v Pharmacy Restructuring Authority (1995) 39 ALD 103 (Loveridge), Mr John Loveridge and his wife, Mrs Pam Loveridge, were the owners of a pharmacy business in a shopping complex called Penrith Plaza. Mr and Mrs Loveridge carried on the only pharmacy business in this shopping complex. Mr Loveridge was an approved pharmacist within the meaning of s 84(1) of the National Health Act.
46. The shopping complex was expanded at the end of 1993 and in 1994 a medical centre was opened as part of the complex. In September 1994, another pharmacist, Mr Terry Hill, applied under s 90 of the National Health Act for approval to supply pharmaceutical benefits, with a view to relocating to premises in the new medical centre forming part of Penrith Plaza shopping complex. The relevant guideline which the Authority was required to apply was guideline 3(d), the same guideline which was the subject of consideration in the Martin case.
47. The evidence before the Authority was that the relocation distance between the two relevant premises was 490 metres. The Authority recommended that Mr Hill’s application be approved and a delegate of the Secretary granted Mr Hill’s application.
48. Mr and Mrs Loveridge sought an order for review under the ADJR Act in respect of the Authority’s recommendation and the decision of the delegate of the Secretary. An issue before the primary judge, Whitlam J, was whether Mr and Mrs Loveridge had standing to complain and to bring an application under the ADJR Act. The primary judge held that they did have standing. In making that finding, Whitlam J, at 106, observed:

They have been subjected to competition in the shopping complex, where formerly there was none. The Authority’s recommendation and the Secretary’s decision thus result in a real grievance.

49. Mr and Mrs Loveridge also contended that they had been denied natural justice. Whitlam J observed, at 106, that that submission could not succeed in light of the Full Court’s decision in Martin, which had been handed down two days before the proceeding had begun.
50. The next case which considered the decision in Martin is the case of The Pharmacy Guild of Australia v Australian Community Pharmacy Authority (1996) 46 ALD 310 (Pharmacy Guild). In that case, the applicant pharmacists applied under s 90 of the National Health Act, for approval to relocate to premises in the Kareela shopping centre. The relevant rule (which superseded the guidelines), which the Authority was bound to apply, provided:
    6. approval of a pharmacist under s 90 of that Act in respect of particular premises must be recommended if the pharmacist is already approved under section 90 of the Act in respect of other premises from which the pharmacist proposes to cease supplying pharmaceutical benefits immediately before the granting of the approval if:
       

...

(c) the premises in respect of which approval is sought are not less than two km, measured door to door by the shortest lawful access route, from the nearest other premises in respect of which a pharmacist is approved under s 90 of the Act...

51. The applicant pharmacists, by their agent, forwarded to the Authority evidence from a surveyor which stated that the distance from the Oyster Bay pharmacy was 2,058 metres travelling in one direction and 2,130 metres travelling in the opposite direction. Mr David Pay, an approved pharmacist, who operated a pharmacy within the vicinity of the Kareela shopping centre, wrote a letter to the Authority stating that amongst other things, there were at least 19 pharmacies operating within a radius of two kilometres of the Kareela shopping centre.
52. The Authority determined to recommend approval of the application for relocation, subject to clarification that the Oyster Bay pharmacy was the closest pharmacy to the proposed pharmacy premises in the Kareela shopping centre. The applicant pharmacists’ agent confirmed in response to an inquiry from the Authority, that the Oyster Bay pharmacy was the closest pharmacy to the proposed premises in the shopping centre.
53. The Authority recommended that the application for approval to relocate be approved; and, subsequently, a delegate of the Secretary approved the application to relocate.
54. An application to review the Authority’s recommendation and the delegate’s decision under the ADJR Act, was made by the Guild of Pharmacists and 10 pharmacists with pharmacy businesses located in the vicinity of the Kareela shopping centre. It was not in dispute that, four of the 10 pharmacists had pharmacies which were located within two kilometres walking distance of the Kareela shopping centre. All of the pharmacists deposed that their economic interests were adversely affected by the decisions.
55. Branson J found that the four pharmacists whose premises were within a two kilometre walking distance of the Kareela shopping centre, had a sufficient interest to afford them standing to bring the application under the ADJR Act. It was unnecessary for Branson J to determine whether the other pharmacists whose premises were more remote, also had standing to seek review of the decisions. Further, Branson J declined to determine whether the Guild of Pharmacists had standing.
56. One of the grounds of review relied upon by the aggrieved pharmacists was that the procedure adopted by the Authority involved a denial of natural justice to the pharmacists in the vicinity, which included Mr Pay, by not providing them with an opportunity to be heard on the question of distance. Branson J observed at 320:

It was contended on behalf of the applicants that the procedure adopted by the authority involved a denial of natural justice to Mr Pay, whose letter of 10 May 1994 was before the authority, and to the second to fifth applicants, or alternatively to the second to eleventh applicants. It seems to me that the approach of the full court in Pharmacy Restructuring Authority v Martin to the issue of procedural fairness makes it impossible for me to accept this contention.

In Pharmacy Restructuring Authority v Martin the full court determined that since the guidelines (now the rules) give the authority no discretion, no purpose would have been served by the authority giving a hearing to the respondents. Here it is suggested that had the respondents been given a hearing, particularly once the authority sought clarification of the distance issue, further evidence would have been placed before the authority on that issue. In every case of this kind, the provision of a hearing to other pharmacists carrying on business in the relevant area may provide additional evidence of distance. It might well have done so in the case of Pharmacy Restructuring Authority v Martin. Yet the full court did not accept that there had been any denial of procedural fairness in that case.

Since the decision of the full court in Pharmacy Restructuring Authority v Martin, the agreement has been executed. As is mentioned above, cl 6.5 of the agreement records an agreement between the guild and the minister that the authority “be entitled to seek and note information from people likely to be directly affected by a recommendation, taking into account the secrecy provision of the Act and the Privacy Guidelines”. This agreement as to the entitlement of the authority to note information from sources other than the applicant does not, in my view, give rise to an obligation in the authority to give a hearing to any person. Nor, in my view, does the fact that the authority circulated a newsletter on or about 14 July 1995, which indicated that in respect of applications for relocation the authority would write, without identifying the applicant, to all other pharmacists in the area of the application identifying the proposed site of the relocation. The authority had determined on 9 June 1995 to recommend approval of the third respondents’ application subject to clarification of the issue of distance. It appears that the process of clarification undertaken by Mr Candy was completed before 14 July 1995. The newsletter cannot, in my view, have given rise to any legitimate expectation of consultation in respect of consideration by the authority of the third respondents’ application.

I do not consider that the circumstances of this case can be satisfactorily distinguished from those considered by the full court in Pharmacy Restructuring Authority v Martin so far as the issue of procedural fairness is concerned.

So far as the secretary is concerned, if procedural fairness did not require the authority to give a hearing to any party other than the third respondents on the issue of distance, it necessarily follows, in my view, that no such duty fell on the secretary.

57. Mr Wong, however, sought to distinguish his case from the binding effect of the decision in Martin.
58. First, Mr Wong contended that the observations of the Full Court in Martin denying persons whose economic interests may be affected, an entitlement to procedural fairness, are to be taken as referring only to persons with a more remote economic interest in the outcome of the decision to be made by the Authority, than that of a person in the position of Mr Wong. Mr Wong said that he was the only existing pharmacist in Pinjarra and, therefore, his economic interest was likely to be directly and immediately affected by the decision of the Authority. This contention cannot be accepted. In Martin and in the cases of Loveridge and Pharmacy Guild, the applicants for judicial review were also pharmacists whose economic interests were likely to be directly and immediately affected by the introduction of a competing pharmacist.
59. In the Martin case itself, the new pharmacy was only two doors away from the pharmacy conducted by Ms Martin and Ms Ridgeway, the affected pharmacists. However, notwithstanding, the immediacy of the threat to their economic interest arising from the proximity of the new pharmacy, the Full Court held that relevant statutory provisions were not to be read as conferring upon Ms Martin and Ms Ridgeway an entitlement to be accorded procedural fairness by the Authority in the making of the recommendation.
60. Further, in Loveridge, the affected pharmacists were the only existing pharmacists in the Penrith Plaza shopping complex, who like Mr Wong, had not, prior to the impugned decision of the delegate of the Secretary, been subject to competition.
61. Notwithstanding this circumstance, Whitlam J found that the Full Court decision in Martin applied to deny Mr and Mrs Loveridge an entitlement to be accorded procedural fairness by the Authority.
62. Also, in Pharmacy Guild, all of the affected pharmacists deposed that their economic interests had been adversely affected by the recommendation and subsequent approval in respect of the relocation of the applicant pharmacist to the Kareela shopping centre. Branson J held that Martin applied in those circumstances.
63. The nature of the interest which the affected pharmacists in all three of the abovementioned cases, unsuccessfully asserted as entitling them to be heard in opposition to the competing pharmacist’s application for approval, is not, in my view, distinguishable from the interest asserted by Mr Wong, namely, the potential diminution in revenue arising from the introduction of the competing pharmacist.
64. Secondly, Mr Wong contended that the statutory scheme in operation at the time of the decision in Martin, was different to the current statutory scheme. In particular, Mr Wong said that the previous scheme directed attention to the restructuring of pharmacies and was not concerned with competition. However, the current scheme, said Mr Wong, is concerned with competition. It was said that an object of the fourth Pharmacy Guild agreement is to improve efficiency through increased competition between pharmacies.
65. In my view, this contention does not assist Mr Wong, because his claim to be entitled to be heard is founded on a claim that his economic interest will be adversely affected by increased competition from a pharmacy operated by Mr Pearson. The Full Court in Martin found that, even under the previous statutory scheme, this interest was not a sufficient interest to afford an affected existing pharmacist, a right to be heard in opposition to the approval of an application to provide pharmaceutical benefits by an applicant who is likely to compete with the business operated by the existing pharmacist.
66. As Wilcox J (with whom Foster and Whitlam JJ agreed) observed in Martin, the “relevant provisions were not concerned with minimising competition”. The position would be a fortiori under the existing statutory regime which is said to be intended to give effect to a policy of increasing competition.
67. Mr Wong also referred to the case of Wood v Australian Community Pharmacy Authority [2002] FCA 1592 (Wood) in support of his contention that he was entitled to be heard by the Authority on the question of the catchment area, as an incident of an entitlement to procedural fairness.
68. In Wood, Mr MacKenzie, a pharmacist, made an application to supply pharmaceutical benefits at particular premises in Karratha in the Pilbara region of Western Australia. The application was made pursuant to rule 6A of the Pharmacy Rules. In short, this rule provided the Authority with a discretion to recommend the approval of an application to supply pharmaceutical benefits, where the following circumstances applied: the proposed premises were in a remote location, there was an existing pharmacist who supplied pharmaceutical benefits in that location, and the Authority was satisfied that the provision of the pharmaceutical benefits by that pharmacist in that location was substantially inadequate. The Authority recommended that Mr MacKenzie’s application be granted and the delegate of the Secretary granted the application. The existing pharmacist, Ms Wood, brought an application for judicial review.
69. Lee J found that, in those circumstances, the existing pharmacist whose performance was being impugned by the pharmacist making the application, was entitled to be heard by the Authority in relation to whether the provision of services by the existing pharmacy was substantially inadequate.
70. At [43], Lee J observed:

The provisions of r 6A expressly direct the Authority to examine the provision of pharmaceutical benefits by a pharmacist by having regard to the criteria specified in the rule, and determining whether the pharmacist has met obligations under the regulations and whether, as a result, the provision of pharmaceutical benefits by that pharmacist is "substantially inadequate". A fair procedure for the determination by the Authority in those circumstances required the Authority to put to a pharmacist whose professional conduct is thereby impugned, any material presented by an applicant that reflected adversely on the adequacy of the provision of pharmaceutical benefits by the existing pharmacist and offered the existing pharmacist the opportunity to comment thereon. The content of the legislation clearly implied such an obligation. (See: Pharmacy Restructuring Authority v Martin at 597; Cenrin Pty Ltd v Lamb (1993) 42 FCR 167 per Spender J at 178.)

71. At [44], Lee J observed:

The terms of r 6A make it apparent that a fair procedure required the pharmacist, whose conduct the Authority was directed to examine, to be given the opportunity to respond to allegations that the provision of pharmaceutical benefits by the pharmacist was “substantially inadequate”. As noted above, the matters to be considered under subr 6A(b)(iv) may lead to findings which could suggest that the pharmacist had committed offences by breach of the specified regulations and, plainly, it was apprehended in the rule that adverse material which may, as in this case, be based on hearsay, would be put to the pharmacist for response.

72. In my view, Wood is distinguishable from this case. In Wood, the relevant rule required the Authority to examine the professional performance of the existing pharmacist and assess the adequacy of that performance. By contrast, rule 107 of the Pharmacy Rules does not call for consideration of the performance of the existing pharmacist. The relevant matter in respect of which the Authority was required to be satisfied in this case, namely, whether the population in the catchment area of the proposed premises is at least 8,000 persons for most of the year, is an objective criterion which does not entail the impugning of the professional performance or conduct of the existing pharmacist. The criterion in issue in this case, is similar in character, therefore, to the distance criteria which were in issue in the Martin, Loveridge and Pharmacy Guild cases.
73. Further, Lee J referred to Martin, in support of his finding that rule 6A implicitly provided the affected pharmacist with a right to be heard in respect of the impugned conduct. It follows that, on the question of whether the relevant provision of the statutory framework at issue in each case, implied a right to an affected pharmacist to be heard, Lee J considered that the effect of the guideline applied in Martin, was distinguishable from the effect of rule 6A of the Pharmacy Rules. As mentioned, the guideline in Martin, as in this case, required the Authority to be satisfied as to an objection criterion – namely, distance – albeit that the question of how the distance was to be measured, was the subject of the controversy in that case.
74. Accordingly, in my view, the Court is bound by the Full Court’s decision in Martin. It follows that Mr Wong’s contention that the recommendation of the Authority was unlawful because he was denied an opportunity to be heard in relation to the material provided by Mr Pearson on the catchment area, as an incident of an entitlement to procedural fairness, is dismissed.
75. Mr Wong also referred to cases where it has been held that objectors under different statutory schemes, had been entitled to be accorded procedural fairness in relation to the decision-making process. However, these cases provided no assistance, because as was recognised by the Full Court in Martin, each statutory scheme must be assessed by reference to its own terms.

FAILURE TO TAKE INTO ACCOUNT A RELEVANT CONSIDERATION

76. Mr Wong contended that in determining the catchment area of the proposed premises, the Authority failed to take into account the opinion expressed in the Rowe report that the number of persons in the catchment area should be reduced because a number of the population located on the western edge of the catchment area, east of the Forrest Highway, may not be deterred by the limitation that is the Forrest Highway, and may see benefits in utilising additional services provided within the Mandurah CBD as a major attractor.
77. Mr Wong contended that the Authority had, therefore, failed to take into account a relevant consideration, and the approval recommendation was, accordingly, liable to be set aside.
78. A decision-maker will fail to take into account a relevant consideration when he or she fails to take into account a consideration which the decision-maker is bound to take into account. Whether the decision-maker is bound to take such a consideration into account will depend upon whether the statute pursuant to which the decision-maker is acting, expressly or impliedly, requires that the consideration be taken into account.
79. In this case, the matters to which the Authority was bound to have regard are set out in rule 107 of the Pharmacy Rules. Relevantly, rule 107(3)(a) required the Authority to be satisfied that the resident population of the catchment area for the proposed premises was, for most of the year, at least 8,000 persons.
80. It is apparent from its reasons for decision, that the Authority did have regard to that consideration and concluded that the resident population of the catchment area for the proposed premises, comprised 9,194 persons.
81. There is no definition of “catchment area” in the Pharmacy Rules or in the statute. Nor does the statute or the Pharmacy Rules direct that the Authority is to take into account specific matters in reaching satisfaction in respect of the requirement in rule 107(3)(a). It follows that there is no requirement that the Authority was bound to have regard to whether persons located to the east of the Forrest Highway were likely to be deterred by the highway from utilising the services in the Mandurah CBD in determining the population of the catchment area.
82. In any event, even if the Authority was bound to take into account the question of whether the Forrest Highway would, or would not, deter persons to the east of the highway, from availing themselves of the services in the Mandurah CBD, in determining the population in the catchment area, in my view, the Authority did have regard to this consideration.
83. In his report, Mr Rowe expressed the opinion that persons to the east of the Forrest Highway may not be deterred by the highway and may see benefits in utilising the additional services provided in the Mandurah CBD. Accordingly, concluded Mr Rowe, persons in those locations should not be counted as comprising persons within the relevant catchment area.
84. Mr Wong contended that the Court should find that the Authority did not take the view expressed by Mr Rowe into account, because there is no express reference in the reasons for the decision, to Mr Rowe’s opinion on this matter.
85. There are two relevant considerations in relation to this contention.
86. First, the Court does not scrutinise the reasons of administrative bodies with “an eye keenly attuned to finding error”, particularly when the body is, as the Authority is, comprised of lay persons.
87. Secondly, in WAEE v Minister for Immigration and Multicultural and Indigenous Affairs (2003) 75 ALD 630 at [47], the Full Court observed:

The inference that the tribunal has failed to consider an issue may be drawn from its failure to expressly deal with that issue in its reasons. But that is an inference not too readily to be drawn where the reasons are otherwise comprehensive and the issue has at least been identified at some point. It may be that it is unnecessary to make a finding on a particular matter because it is subsumed in findings of greater generality or because there is a factual premise upon which a contention rests which has been rejected.

88. In my view, these observations are apposite to the approach of the Authority in this case. That the Authority had regard to whether the Forrest Highway would, or would not, act as deterrent to persons seeking to access the services and attractions of the Mandurah CBD, is to be inferred from the Authority’s finding that only half of the population in the West Pinjarra Strategic Growth Area, being those to the east of the Forrest Highway, were to be included in the population in the catchment area, because the Forrest Highway was a barrier which appeared to divide the area in half. The Authority’s finding to that effect, rendered it unnecessary for it to state expressly that it disagreed with Mr Rowe’s view, because that fact is implicit in the Authority’s finding that the highway would act as a barrier to the population to the east of the highway.
89. The inference that the Authority had regard to, but rejected Mr Rowe’s opinion, is strengthened by the fact that Mr Rowe’s opinion about the non-deterrent effect of the Forrest Highway, is expressed as an assertion and in tentative terms, and by the fact that the Authority expressly stated in its reasons for decision, that Mr Rowe’s report was in evidence before it.
90. The complaint made by Mr Wong is, in essence, a complaint going to the merits of the Authority’s decision and not to the lawfulness of that decision. This ground of review is dismissed.

UNREASONABLENESS

91. Mr Wong also contended that the Authority’s decision was unreasonable and contrary to law, because it was inconsistent with the decision made by the Tribunal in respect of the application made for the supply of pharmaceutical benefits from 53 George Street, earlier in 2010.
92. In my view, this contention cannot be accepted. The question of whether the Authority’s decision was unreasonable, must be assessed by reference to the material which was before the Authority. On the material that was before the Authority, the decision to which the Authority came, was open to it. In those circumstances, it cannot be said that the decision was unreasonable, or a decision to which no reasonable Authority acting reasonably and rationally, could come.
93. It does not avail Mr Wong simply to point to the fact that there are two apparently inconsistent decisions by the Authority. The apparently inconsistent decision in relation to the 53 George Street application may be explicable on a number of grounds – not the least of which is the nature of the evidence before the Authority on that occasion.
94. The other submissions that Mr Wong raised in support of this ground, namely, unequal treatment of Mr Wong and Mr Pearson in the decision-making process, mistakenly assumed that Mr Wong was entitled to be accorded procedural fairness in the making of the approval recommendation by the Authority.
95. Accordingly, this ground of review is dismissed.

THE CLAIM IN RESPECT OF THE DECISION MADE BY THE DELEGATE OF THE SECRETARY

96. Mr Wong impugned the decision of the delegate of the Secretary on the grounds that he was not provided, as an incident of procedural fairness, with an opportunity to be heard.
97. A similar argument was made before Branson J in the Pharmacy Guild case. Her Honour dismissed the contention on the basis that the same considerations which applied to deny an entitlement to procedural fairness in relation to the decision of the Authority in that case, applied likewise, in relation to the decision of the delegate of the Secretary.
98. In my view, it cannot be said that the decision of Branson J is plainly wrong. Accordingly, I follow and apply her Honour’s decision.
99. It follows that Mr Wong’s claim against the second respondent is dismissed.
100. It also follows that Mr Wong’s application for judicial review against the first and second respondents is dismissed.
     

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

Associate:

Dated: 7 February 2011