Crowe v Mercy Health and Aged Care Central Queensland Limited

[2001] QSC 384

SUPREME COURT OF QUEENSLAND

CITATION:                   Crowe v Mercy Health and Aged Care Central Queensland Limited [2001] QSC 384

PARTIES:   DR GEORGE ROBERTSON CROWE

(Applicant)

v  

MERCY HEALTH AND AGED CARE CENTRAL QUEENSLAND LIMITED

(Respondents)

FILE NO:  S137/2001

DIVISION:  Trial Division

DELIVERED ON:         12 October 2001

DELIVERED AT:          Rockhampton

HEARING DATE:          21 September 2001

JUDGE:   Dutney J

ORDERS:Application is adjourned to the callover list.  Costs reserved

CATCHWORDS:           ADMINISTRATIVE LAW – JUDICIAL REVIEW - Plaintiff’s clinical privileges revoked by private hospital - Whether court has jurisdiction to declare void or legally invalid – Whether summary procedure appropriate.

NATURAL JUSTICE - BIAS – Whether the rules of natural justice apply in a case of purely domestic tribunals – Whether perception of bias sufficient for interlocutory injunction.

INTERLOCUTORY INJUNCTION –Balance of convenience.

Baldwin v Everingham [1993] 1 Qd R 10 referred to.
Bornecrantz v Queensland Bridge Association Inc [1999] QSC 58 cited.
Cameron v Hogan (1934) 51 CLR 358 referred to.
Forbes v NSW Trotting Club Ltd (1979) 143 CLR 242 referred to.
Gamilaroi Boomerangs v Members of New England Group 19 [1999] NSWSC 495 cited.
H.B. Homes Pty Ltd v Beer [1986] 2 Qd R 379 referred to.
Maloney v NSW National Coursing Association Ltd [1978] 1 NSWLR 161 referred to.
North Sydney Cricket Club Inc v Sydney Cricket Association (SC of NSW – 31 March, 1995 – unreported) cited.
Re Maggacis [1994] 1 Qd R 59 referred to.

The Health Act 1937 s64.

COUNSEL: P Land for the Applicant

DVC McMeekin for the Respondent

SOLICITORS:                S R Wallace & Wallace for the Applicant

Rees R & Sydney Jones for the Respondent

1. DutneyJ: Dr Crowe is a physician practising in Mackay.  The respondent is the company responsible for the Mater Hospital in Mackay.  On 1 August the General Administrative Committee resolved to accept a recommendation from the Executive Committee to revoke Dr Crowe’s clinical privileges at the hospital.  The Executive Committee recommendation followed its adoption of a recommendation from the Credentials Committee.  The revocation of clinical privileges results in Dr Crowe being denied access to the hospital facilities for treatment of his patients.

1. Dr Crowe seeks a declaration that the revocation of clinical privileges is void or legally invalid.  He further seeks injunctions whether interlocutory or not having the effect of restoring his right to use the hospital facilities.  The basis of these applications is that he was denied natural justice.  The respondent is a purely private corporation.  It is not amenable to the provisions of the Judicial Review Act.  If I have power to interfere in the internal affairs of the corporation, however, it is only in relation to the process.  The correctness or otherwise of the decision to revoke the applicant’s clinical privileges is not a matter I have been asked to consider and nor could I consider it without a full trial of the issues involved even if the power to do so exists.

2. Some background is necessary.  The process to which Dr Crowe was subjected is governed by the “Visiting Practitioners Medical/ Non-medical By-Laws”.  The initial grant of clinical privileges is governed by rule 4.30.  Rule 4.301 requires all visiting practitioners desiring to use the hospital’s facilities to complete an application for submission to the Chief Executive Officer.  Rule 4.302 requires the Chief Executive Officer to submit the application to the Credentials Committee.  Following a positive recommendation of the Credentials Committee the Executive adds the applicant’s name to the register of visiting or other practitioners in the category of practice or specialty in which he has been granted privileges.

1. The withdrawal of privileges is governed by rule 4.204 which is in the following terms:

   “Appointments, reappointments and revocation of appointments shall be made by the Executive and endorsed by the General Administrative Committee only after an application has been reviewed and a recommendation made by the Credentials Committee.”

1. Unlike the grant of clinical privileges, no procedure is laid down for the revocation of those privileges.

1. Rule 4.502 provides for an appeal to the Chairman of the Health Services Board against any decisions relevant to their accreditation to the hospital.  Again no procedure is specified.

1. Finally, while dealing with relevant rules regard must be had to rule 4.102 which provides:

   “Acceptance of privileges granted, shall constitute acceptance by the practitioner of the conditions set out in these By Laws and his agreement to abide by the ethical principles, philosophies and objectives of the hospital and to adhere to any policies and procedures covering conduct of the hospital in force from time to time.”

1. Dr Crowe relates his troubles with the hospital to a troubled relationship with Dr Fitzsimmons.  Dr Fitzsimmons is an anaesthetist in Mackay with clinical privileges at the Mater Hospital.  In early July 2001 Dr Crowe was advised by the Health Assessment Unit of the Medical Board of Queensland that a complaint had been made against him by Dr Fitzsimmons in relation to his treatment of three patients.  Dr Fitzsimmons in his affidavit agrees that the complaint was made but says that he made it in his capacity as chairperson of the Medical Advisory Committee.  Dr Fitzsimmons says that he brought the matters to the attention of the Medical Board to see if they warranted any further investigation.

1. There also seems to have been some disharmony between Dr Crowe and Dr Fitzsimmons over the need to engage an anaesthetist when performing endoscopies.  Dr Crowe’s practice seems to have been to give the sedation himself.  Dr Fitzsimmons denies that he told Dr Crowe that he wanted to give sedation to all patients who have gastroscopic procedures but says that he merely passed on the recommendation of the Medical Advisory Committee which was that it was not mandatory but highly desirable to have a person other than the operator controlling the management of monitoring and sedation of the patient undergoing surgery.[1]

[1] Fitzsimmons affidavit exhibit “DLF1”,page 3.

1. At all times Dr Fitzsimmons was on the Medical Advisory Committee.

1. On 11 July 2001 Dr Crowe received a show cause notice by letter from the chief executive officer of the hospital, Mr John Nugent.  The letter raised concerns in relation to 14 patients over a period of two years.  Included among the patients in relation to which Dr Crowe was asked to show cause were the three patients in relation to which the reference to the Medical Board was made.  One of the complaints was in relation to cancelling the booking for an anaesthetist for a gastroscopy to be performed in day surgery.  These four particular complaints were the most recent and occurred over a short period of about a fortnight.[2]

[2] This is particularly noted in the minutes of the Credentials Committee and is stated to be the reason for the show cause: see Crowe exhibit “GRC11” at page 7.

1. Dr Crowe responded to the letter and a hearing of the Credentials Committee was convened for 17 July 2001.  Dr Crowe’s complaint is that he was not afforded natural justice at the hearing.  During the course of argument his counsel, Mr Land, identified four specific areas of complaint which are submitted to justify the intervention of the court.  These were firstly, the composition of the Credentials Committee was such that there was a reasonable apprehension of bias; secondly, the role played by members of the committee in the investigation of the complaints rendered them ineligible to sit for the same reason; thirdly, Dr Crowe was denied legal representation; and finally, Dr Crowe was denied the opportunity to address on penalty.  To these might also be added a concern that many of the same persons who sat on the Credentials Committee were also members of the General Administrative Committee and the Executive who were required to consider the recommendation of the Credentials Committee.

1. The respondent raises a preliminary issue which seems to me to require a determination in favour of Dr Crowe before any other issue arises in relation to the primary relief.  This is the extent to which the rules of natural justice as they apply to public bodies with the power to affect rights or privileges apply in the case of purely domestic tribunals. In particular it is submitted that to result in the decision of any of the committees of the respondent hospital being invalid or void for bias, actual bias must be proven and a mere perception of bias, however reasonable is not sufficient.  Unless actual bias is proven the respondent submits the matters raised can only be determined after a trial on the merits.

1. As is apparent from the rules set out above the ultimate decision to withdraw privileges is made by the executive.  The members of the executive who made that decision were Mr Nugent, the CEO, Ms Wade, the director of nursing, Mr Cousins, the director of finance and general services, and Sister Stancia Cawte, the assistant CEO.

1. The General Administrative Committee comprised 8 members including Sr Stancia Cawte, Ms Wade and Mr Nugent.  The Credentials Committee comprised 10 members including Sr Stancia Cawte, Ms Wade, Mr Nugent and Dr Fitzsimmons.

1. The principal authority relied on by the respondent on this issue was Maloney v NSW National Coursing Association Ltd[3] where Glass JA said:

   “The passages I have quoted from these various decisions furnish, in my view, adequate support for the proposition that the requirements of natural justice are in some respects different where domestic tribunals are concerned.  They also adumbrate the reasons why this is so.  In the administration of justice by courts proper, and those acting in a similar capacity, public policy requires that there should be no doubt about the purity of the administration. . . .The rules being enforced have no consensual basis.  The parties have not chosen the tribunal . . .Domestic tribunals are usually established in circumstances which are radically different.  The members generally speaking have agreed to abide by a set of rules and the authority of a committee to enforce them, if necessary by expulsion.  The committee members cannot, in the nature of things, divest themselves of the manifold predilections and prejudices resulting from past associations with members.  Apprehension of bias could be generated in all kinds of ways.  If it was a disqualifying consideration, the enforcement of the consensual rules would be largely unworkable.  There may be some circumstances where a suspicion of bias would operate to disqualify a member of a domestic tribunal.  But generally speaking it does not so operate and, in particular, it cannot operate with respect to tribunals such as that set up by article 10 in the articles of the defendant association.”

[3] [1978] 1 NSWLR 161 at 170 –171.

1. The issue is not easily resolved as evidenced by Glass JA’s qualification that the rule may not be universal.  In seeking to identify the extent to which the rule may not be universal reference should be made to what Murphy J[4] wrote in relation to the powers of a racing club committee to “warn off” an individual where it was alleged natural justice had not been afforded:

   “There is a difference between public and private power but, of course, one may shade into the other.  When rights are exercised directly by the government or by some agency or body vested with statutory authority, public power is obviously being exercised, but it may be exercised in ways that are not so obvious.  In my opinion, a body which conducts a public racecourse at which betting is permitted under statutory authority, to which it admits members of the public on payment of a fee, is exercising public power.  It may not arbitrarily exclude or remove such a person from the lands during a race meeting.”

[4] Forbes v NSW Trotting Club Ltd (1979) 143 CLR 242 at 275. The discussion of the difference between small private organisations and those which perform a “substantial public function” by Dowsett J and the extent to which Cameron v Hogan (1934) 51 CLR 358 remains applicable can be found in Baldwin v Everingham [1993] 1 Qd R 10.

1. It is not clear to me that the Mater hospital should be treated differently from a body such as a turf club which operates under a governmental authority.  The legislation governing the operation of a private hospital is complex.  For example, it can operate lawfully only while it is the holder of a license under Part 3 Division 4 of The Health Act 1937 (Qld).[5]  The Health (Private Hospitals) Regulation 1978 requires the licensee of the hospital to report monthly in relation to patients and maintain prescribed records of treatment. There is in my view a strong argument to be made that the requirements of natural justice as they relate to a private hospital should be more closely aligned with the requirements relating to public authorities rather than those relating to purely private associations.[6]  Particularly might this be so where the matter in issue concerns the income and livelihood of the complainant.  Of course, as in many cases where a breach of natural justice is alleged it is only the first step to determine that the complainant is entitled to natural justice.  It is also necessary in cases where the distinction between purely private and public powers is blurred to determine the content of the rules of natural justice in the particular case.

[5] See s64.

[6] In my view the uncertainty of the law in this area is heightened rather than clarified by the decision of Thomas J in Re Maggacis [1994] 1 Qd R 59.

1. In my view it is not appropriate to resolve this matter on an interlocutory application.  Counsel for the applicant concedes that the authorities concerning what must be proved to establish bias in the case of a private organisation tend towards the necessity for actual rather than apprehended bias.[7]

[7] Cases referred to in argument and written submissions include North Sydney Cricket Club Inc v Sydney Cricket Association (SC of NSW – 31 March, 1995 – unreported) at paras 43,48; Bornecrantz v Queensland Bridge Association Inc [1999] QSC 58 at paras 33-34; Gamilaroi Boomerangs v Members of New England Group 19 [1999] NSWSC 495 at paras 54-58.

1. Actual bias is alleged in this case as well as apprehended bias.  If apprehended bias were enough I would have no hesitation in allowing the application on the basis that the inclusion of Dr Fitzsimmons on the Credentials Committee in view of his earlier complaint about the same matter to the Medical Board and apparent financial interest in issue concerning the use of specialist anaesthetists and the presence of Sr Stancia Cawte, Ms Wade and Mr Nugent both on the recommending committee and on the decision making committees.  In addition, Ms Wade had also made complaints concerning Dr Crowe and had formed a view at least to the extent of being concerned prior to the meeting of the Credentials Committee.  The applicant submits that this latter matter is sufficient to satisfy me that actual bias is established.  It seems to me, however, that ultimately this is a factual matter.  If the law is uncertain and the extent to which it is necessary to find facts depends on the correct law to be applied I consider it inappropriate to take a piecemeal approach to the matter.  With some reluctance, recognising the potential financial consequences for Dr Crowe, I consider that the matter must in the end be resolved by a trial.  I take this view recognising that there are grounds raised other than bias for setting aside the decision.  The issues seem to me to be intertwined to the extent that it is not appropriate to attempt to separate them at this stage.

1. The question of an interlocutory injunction pending trial now arises.  In my view there is clearly a serious question to be tried in this case and the issue becomes one of weighing the balance of convenience.  The fact that any interlocutory injunction would be, in effect, a mandatory one requiring the hospital to make its facilities available to Dr Crowe does not, in my view, inhibit the power to make the order sought.[8]

[8] See H.B. Homes Pty Ltd v Beer [1986] 2 Qd R 379.

1. For Dr Crowe the matters going to convenience are clear-cut.  As long as the matter remains unresolved he is losing income in circumstances which may ultimately prove to be wrong.  There is also an effect on Dr Crowe’s reputation although the hospital contends that this is self-inflicted by reason of the advertisements placed in the local newspaper.  To obtain an injunction Dr Crowe would, of course have to give the usual undertaking as to damages which in this case might, prima facie, include indemnifying the hospital against any negligence claim concerning him arising during the currency of the injunction.

1. For the hospital the issues raised include the availability of an expeditious appeal.[9]  While the procedures under which such an appeal might be conducted are subject to some dispute I can see no reason why such an appeal ought not to proceed whether or not an interlocutory injunction is granted.  Dr Crowe retains access to two other hospitals for treatment of his patients although I understand that those hospitals do not necessarily have the same facilities as the Mater hospital or co-extensive facilities with the Mater Hospital.  Finally, it is submitted that if the Credentials Committee decision is correct the hospital is exposed to the possibility of claims against it by reason of the actions of Dr Crowe.

[9] Forbes, Disciplinary Tribunals p166 at para [16.8].

1. On balance I am not prepared to grant an interlocutory injunction in this matter.  In reaching this conclusion I have taken into account in addition to the factors I have listed the fact that if the parties are minded to progress this matter quickly a final hearing can be afforded before the end of the current court year.  In the end I take the view that this matter should be finally disposed of as quickly as possible and that pending such final resolution the balance of convenience does not favor any change to the current position.

1. The application is adjourned to the callover list.  I will hear the parties in relation to directions to expedite the hearing.

1. I reserve the costs of the application.