Dang and Australian Pharmacy Authority and Department of Health and Aged Care - [2002] AATA 382

DECISION AND REASONS FOR DECISION [2002] AATA 382

ADMINISTRATIVE APPEALS TRIBUNAL )

)Nos. S2001/60 & S2001/331

GENERAL ADMINISTRATIVE DIVISION       )
           Re      DAT DANG
  Applicant
           And    AUSTRALIAN COMMUNITY PHARMACY AUTHORITY and SECRETARY, DEPARTMENT OF HEALTH AND AGED CARE
  Respondents

DECISION

Tribunal Senior Member J.A. Kiosoglous MBE

Date23 May 2002
PlaceAdelaide

Decision In accordance with section 43 of the Administrative Appeals Tribunal Act 1975 the Tribunal affirms the decisions under review.

(Signed)
J.A. KIOSOGLOUS
(Senior Member)

CATCHWORDS
PHARMACEUTICAL BENEFITS - Pharmacy Restructuring Scheme - "shortest lawful access route" - application of appropriate test to proposed routes - characteristics of routes considered

National Health Act 1953 ss. 90, 99K, 99L
Pharmaceutical Benefits Determination No.PB8 of 2000

REASONS FOR DECISION

23 May 2002 Senior Member J.A. Kiosoglous MBE

These are applications for review by Mr Dat Dang (the applicant) for review of a recommendation of the Australian Community Pharmacy Authority (the first respondent) dated 29 November 2000 (T11) and the subsequent decision of a delegate of the Secretary, Department of Health and Aged Care (the second respondent) dated 7 December 2000 (T12) which, on the basis of the Australian Community Pharmacy Authority's recommendation, decided that the applicant not be approved for the purposes of supplying pharmaceutical benefits at or from premises situated at Shop 12, Martin Plaza, corner Martins and Shepherdson Roads, Parafield Gardens, South Australia ("the premises").
The Tribunal received into evidence the documents lodged pursuant to section 37 of the Administrative Appeals Tribunal Act 1975 (T1-T12), together with 35 exhibits, 20 tendered by the applicant (Exhibits A1-A20) and 15 by the respondent (Exhibits R1-R15). The applicant was represented by Mr D. Simpson and Ms S. Maharaj represented both respondents, both of counsel. Mr M. Keith, of counsel, represented the applicant at the subsequent jurisdictional hearing.
The Tribunal heard evidence from the applicant, who also called Mr John Frederick Peterson, Licensed Surveyor. The respondent called two witnesses: Mr Francis John Ross, Secretary of the Australian Community Pharmacy Authority and Mr Bryan R. Hennig, Licensed Surveyor.
In making its recommendation whether or not the applicant should be approved under sub-section 90(1) of the National Health Act 1953 ("the Act"), the first respondent must comply with the guidelines determined by the Minister pursuant to section 99L, subject to which the first respondent is to make recommendations under sub-section 99K(1). Determination No.PB8 of 2000 came into operation on 26 July 2000 ("the Rules")(T3). The parties did not dispute the application of these rules to the current matter. As the applicant is seeking approval for relocation of an existing pharmacy the rule to be considered is Rule 6.
Rule 6 of the Rules provides as follows:
"6.Subject to paragraphs 8 and 9, approval of a pharmacist ("the applicant") under section 90 of the Act in respect of particular premises must be recommended if the applicant has a legal right to occupy those premises for the purpose of operating a pharmacy, and either:
(aa)the applicant is approved under section 90 of the Act in respect of other premises and the applicant has agreed that that approval will be cancelled immediately before the approval under consideration, if granted, takes effect; or
(ab)another pharmacist:
(i)is approved under section 90 of the Act in respect of other premises and that pharmacist has agreed that that approval will be cancelled immediately before the approval under consideration, if granted, takes effect; and
(ii)has indicated in writing that the cancellation is intended to enable recommendation, under these rules, of approval of the applicant; and
in either case, if the approved pharmacist has ceased to carry on business as a pharmacist at the other premises, the Secretary:
(ac)…; and
(ad)…:
and one of the following circumstances applies:
(a)…; or
(b)…; or
(c)the premises in respect of which approval is sought are situated not less than 2 kilometres, measured door to door by the shortest lawful access route, from the nearest other premises in respect of which a pharmacist is approved under section 90 of the Act."
The issues for determination by the Tribunal are as follows:
(a)whether Rule 6(c) of the Rules is complied with, namely whether the distance from the nearest other pharmacy to the proposed premises is at least 2 kilometres, measured door to door by the shortest lawful access route, from the nearest other premises in respect of which a pharmacy is approved under section 90 of the Act ("the 2 kilometre rule"); and
(b)whether or not the applicant is able to substitute another agreement for the transfer of an HIC Approval Number after the lodgement of the application with this Tribunal and prior to a decision being handed down.
The Tribunal does not intend to set out the facts as submitted to it but notwithstanding this it has taken into account the evidence as a whole in arriving at its decision. Briefly the facts are that on 18 September 2000 the applicant, pursuant to section 90 of the Act, applied for approval in respect of premises to be located at Shop 12, Martin Plaza, corner Martins Road and Shepherdson Road, Parafield Gardens, South Australia, 5107 (T4). This application was received by the Health Insurance Commission ("HIC") on 18 September 2000 (T4.1).
On 20 September 2000 the Delegate of the Secretary to the Department of Health and Aged Care (the second respondent), within the HIC, referred the application to the first respondent, pursuant to section 90(3A) of the Act, for the purpose of obtaining a recommendation as to whether the application should be approved (T5.1). At its meeting on 28 November 2000 the first respondent considered the application but was unable to agree to it, resolving to recommend its rejection as it failed to meet the requirements of Rule 6(c) in that the distance nearest to another approved pharmacy was less than 2 kilometres (T11.1). On 7 December 2000 the second respondent wrote to the applicant advising of the first respondent's recommendation and that accordingly the application was rejected (T12.1). The applicant applied to the Administrative Appeals Tribunal on 14 February 2001 for review of the first respondent's recommendation and on 4 September 2001 the applicant also applied to the Tribunal for review of the second respondent's decision.
The Tribunal needs to determine whether the application complies with the 2-kilometre rule. The surveyors, J.F. Peterson and B.R. Hennig, were called by the parties to measure the distances of the routes from the premises to the nearest existing pharmacy. It was not disputed that the nearest existing pharmacy is Patrick's Pharmacy, Shop 4, Parafield Plaza Shopping Centre, 482 Salisbury Highway, Parafield Gardens, 5107.
The Tribunal had before it several routes for its consideration between Patrick's Pharmacy and the applicant's proposed site. In arriving at its conclusion the Tribunal is bound to consider all of the routes which can be accepted as being the shortest lawful access route and comply with the 2-kilometre rule. Each of these routes was inspected by the Tribunal accompanied by counsel for each of the parties, the applicant and others.
The Tribunal in considering its decision needs to determine whether or not the applicant's application complies with the 2 kilometre rule. The surveyors called by each of the parties to measure the distances of the routes from the premises to the nearest existing pharmacy had differences of opinion on the methodology to be followed.
The parties disputed which was the appropriate route to be followed in measuring the shortest lawful access route between the premises and Patrick's Pharmacy.
The Tribunal was initially asked to consider five routes from the premises to Patrick's Pharmacy. However, at the viewing Ms Maharaj, of counsel, for the respondents also raised a further possible route through Blackie Avenue, although she submitted that she did so as a matter of course and that it was far from being a "shortest lawful access route" and that in any case this was under two kilometres. The Tribunal added this to the other five routes for its consideration.
Of the six routes proposed, four submitted by the respondents were all under the two-kilometre limit. The applicant submitted that the "preferred route" exceeded the requirement of two kilometres (Exhibit A6) whilst another route shown on the plan (Exhibit A6) as being the "A1 route" was put forward by the respondents. The applicant referring to the "A1 route" did so not to suggest that it is an appropriate alternative to the "preferred route" but rather as a comparison. On the other hand the respondents submitted that this was an appropriate route but that it did not satisfy the two-kilometre rule and it was not disputed that the A1 route measured 1,846 metres.
The Tribunal, therefore, turns first to consider whether or not the "preferred route" submitted by the applicant is a route which can be described as being the shortest lawful access route. This route commences from the front door of Patrick's Pharmacy to the front door of the proposed premises at Martins Plaza Shopping Centre which at all times used footpaths and authorised pedestrian crossings. This route was measured as being 2000.38 metres. Upon leaving Patrick's Pharmacy the route travelled over the car park road area for a short distance until reaching the entry of the car park at Kelleway Street and turning right on the footpath towards Salisbury Highway at the corner of which is a service station. At the corner still travelling on the footpath the route continues as far as authorised pedestrian crossing lights and then crosses Salisbury Highway to the footpath where it continues in a northerly direction to Shepherdson Road at the corner of which is another service station. The route turns left still continuing on the footpath in a westerly direction along Shepherdson Road until it reaches school pedestrian crossing lights and crosses at this crossing to the adjacent side. Once reaching the other side it is not a simple matter of turning left on the footpath and continuing the route along Shepherdson Road in a westerly direction. Due to its being a school crossing there are barriers erected which no doubt are there to prevent children leaving the school ground and converging on to the road. As a result of these barriers in the form of cyclone wire fencing the route undertakes a U-shape adding extra measurements to the preferred route. Without this particular U-shape area at the school pedestrian light crossing the preferred route would fail to measure the required two kilometres.
Whilst the Tribunal has not yet considered the other routes it is satisfied and so finds that the preferred route from Patrick Pharmacy to the school pedestrian light crossing but prior to crossing Shepherdson Road is the shortest lawful access route. It makes this finding on the basis that each of the routes traverse over some portion of the Parafield Plaza Shopping Centre but that the preferred route is very minimal and does not have to encounter median strips nor go through service stations.
At the school lights, the preferred route crosses as described previously whereas the A1 route continues on the south side of Shepherdson Road in a westerly direction. Both routes in fact continue in the westerly direction until reaching the vicinity of the car park entry into Martin Plaza Shopping Centre. The Tribunal is satisfied that the travelling along Shepherdson Road in the westerly direction is appropriate. Notwithstanding this, the Tribunal needs to consider whether or not the crossing at the school crossing can be deemed to be described as the shortest lawful access route.
The Tribunal is satisfied that the school lights crossing is operative and useable by pedestrians seeking to cross Shepherdson Road at that point at all times, as submitted by counsel for the applicant. There was no evidence submitted to the contrary and the Tribunal so finds that the lights are operative at all times for persons desirous of crossing at those lights.
The Tribunal noted that Shepherdson Road does have traffic, but certainly nothing similar to that of Salisbury Highway, and it cannot be termed to be a busy road. Unlike Salisbury Highway it is not a wide road and does not require the normal pedestrian crossing lights. The Tribunal is satisfied that the crossing lights on Salisbury Highway are essential due to danger of consistent traffic to enable everybody to use and cross. In the case of the crossing lights on Shepherdson Road these are positioned at the school for school children. Unlike the lights on Salisbury Highway those at the school crossing cannot be termed to be regularly used. The Tribunal is satisfied and so finds that the U-shape direction of the applicant's preferred route cannot be deemed to be the shortest access route although lawful. Having made this finding the Tribunal has no alternative but to reject the applicant's preferred route as the shortest lawful access route as without the U-shape section it fails to meet the two-kilometre rule. In reaching its decision the Tribunal does so on that basis alone, appreciating the frustration of the applicant's failure to succeed by a sheer few centimetres. It is hoped that commonsense can prevail and a satisfactory solution be attained.
The Tribunal having reached its decision on the preferred route has no reason to consider the routes proposed by the respondents as each of these is below the two-kilometre distance.
As to the issue of the transfer of the HIC approval number, the Tribunal again does not need to consider this as any finding in this regard would have little bearing on the final result in this matter.
Accordingly, for the reasons outlined previously, the Tribunal affirms the decisions under review.

I certify that the 22 preceding paragraphs are a true copy of the reasons for the decision herein of Senior Member J.A. Kiosoglous MBE.
Signed:   (Signed)
  Barbara Armstrong, Associate
Dates of Hearing  14 September 2001, 17-19 September 2001,   20 February 2002 & 4 April 2002

Date of Decision  23 May 2002
Counsel for the Applicant        Mr D. Simpson & Mr K. Martin
Solicitor for the Applicant         Jaak Oks Lawyers
Counsel for the Respondents Ms S. Maharaj
Solicitor for the Respondents AGS