Faith McDonald (Evolution Psychology) v Michael McCartney - [2023] QCATA 53

QUEENSLAND CIVIL AND
ADMINISTRATIVE TRIBUNAL

CITATION:

Faith McDonald (Evolution Psychology) v Michael McCartney [2023] QCATA 53

PARTIES:

FAITH MCDONALD (EVOLUTION PSYCHOLOGY)

(appellant)

v

MICHAEL MCCARTNEY

(respondent)

APPLICATION NO:

APL109-22

ORIGINATING APPLICATION NO:

MCDO656-21

MATTER TYPE:

Appeals

DATE

10 May 2023

HEARING DATE:

Heard on the papers

HEARD AT:

Brisbane

DECISION OF:

Member JR McNamara

ORDERS:

1.        The stay of the decision is lifted.

2.        Leave to appeal part of the decision is granted.

3.        The appeal against that part of the decision concerning invoice 254 and invoice 281 is allowed.

4.        That part of the decision concerning invoice 254 and invoice 281 is set aside.

5.        Faith McDonald (Evolution Psychology) must pay Michael McCartney the sum of $2760.00, together with the $127.50 filing fee within 28 days of the orders in this matter being published.

CATCHWORDS:

APPEAL – GENERAL PRINCIPLES – RIGHT OF APPEAL – WHEN APPEAL LIES – LEAVE TO APPEAL – where appellant is a registered provider under National Disability Insurance Scheme (NDIS) – where respondent works as support coordinator under the NDIS – whether appellant and respondent had a contractor agreement – where respondent carried out services for NDIS clients – where signed NDIS service agreements were not provided with invoices – where appellant ordered to pay respondent amounts under unpaid invoices – where adjudicator erred in weight given to certain evidence – where appeal sought against part of decision – where leave to appeal granted – where appeal against part of a decision allowed

Queensland Administrative Tribunal Act 2009 (Qld)

s 142

Pickering v McArthur [2005] QCA 294, cited

APPEARANCES & REPRESENTATION:

This matter was heard and determined on the papers pursuant to s 32 of the Queensland Civil and Administrative Tribunal Act2009 (Qld)

REASONS FOR DECISION

This is an appeal from a decision made in the tribunal’s Minor Civil Debt jurisdiction. Leave to appeal must be obtained before an appeal is determined.[1]
[1]Queensland Administrative Tribunal Act 2009 (Qld) s 142(3)(a)(i).
Leave to appeal will usually only be granted where an appeal is necessary to correct a substantial injustice to the appellant and there is a reasonable argument that there is an error to be corrected.[2]

BACKGROUND

[2]Pickering v McArthur [2005] QCA 294, [3].

Michael McCartney worked as a Support Coordinator for clients under the National Disability Insurance Scheme (NDIS). The NDIS is implemented by the National Disability Insurance Agency (NDIA). For convenience, all references in this decision are to the NDIS. He was not a registered provider in his own right which meant he could not engage directly with the NDIS for payment for his services. Faith McDonald operates the business “Evolution Psychology.” Evolution Psychology is a NDIS registered provider. An arrangement between Mr McCartney and Ms McDonald enabled Mr McCartney to provide services to his NDIS clients and invoice the NDIS through Evolution Psychology.
The dispute concerned the non-payment of three invoices in respect of services provided to two clients identified as DL and BK. Invoice 254 for $2940 and invoice 280 for $2760 were in respect of client DL; and invoice 281 for $2040 was in respect of client BK. In her response material and at the hearing, Ms McDonald accepted liability for the payment of invoice 280 in the amount $2760.

Client Service Agreements

Ms McDonald said a NDIS precondition to the processing of invoices is the provision of a service agreement signed by the client. Ms McDonald says without the signed agreements the invoices were incapable of being processed with the NDIS.
In relation to invoice 254, Mr McCartney says there was a signed client service agreement with DL. Ms McDonald says she does not have a copy of the client service agreement necessary to process the invoice for payment and to confirm that the hours claimed are within the Support Coordinator allowance for the period claimed.
In relation to invoice 281 Ms McDonald says that: “The service agreement was never signed by the NDIS Participant.”
Contractor Agreement
The nature of the business relationship between Mr McCartney and Ms McDonald was central to the dispute. Mr McCartney said there was a signed agreement which he believed should be found on the Evolution Psychology computer system. Ms McDonald could not recall if an agreement was signed, and despite searches undertaken a copy could not be located. No written agreement signed or unsigned was in evidence.

The Adjudicator’s decision and outcome

The Adjudicator accepted the evidence of Mr McCartney that there was a signed agreement between Mr McCartney and Ms McDonald and that the invoiced work had been done in accordance with that agreement. The Adjudicator was not satisfied that it was a condition of that agreement that a signed service agreement between Mr McCartney and his NDIS clients must invariably accompany invoices submitted for payment. No other terms and conditions of the agreement were explored.
At the hearing, and before Ms McDonald provided further context,[3] the Adjudicator expressed the view that the statement in an email from Renee Pryde, the practice manager at Evolution Psychology, to Mr McCartney that the invoices “will be processed for payment to you,” seemed to amount to an admission of liability.[4] The Adjudicator confirmed that view while delivering the decision, saying the practice manager “… unequivocally, in other words, in an admission of liability, that they would be processed for payment to Mr McCartney. The fact is they weren’t for a variety of reasons after the event but I place significant weight on the admission of liability by Renee Pryde as your agent, binding you and your practice to the obligation to make the payment.”[5]
[3] T1-15, lines 17 to 25.
[4] T1-15, lines 14 to 15.
[5]T1-20, lines 8 to 12.
The tribunal ordered that Ms McDonald pay Mr McCartney $7,740 for the claim and the $127.50 filing fee by 30 April 2022.
An application for leave to appeal or appeal, and an application to stay the Adjudicator’s decision were filed on 28 April 2022. The stay was granted on 15 August 2022.

The appeal

Ms McDonald seeks leave to appeal part of the decision of the tribunal made on 30 March 2022. The “part” concerns invoice 254 and invoice 281. She says the decision is wrong because account of relevant matters was not taken, and that there has been a substantial injustice.
The grounds are particularised in the application. They concern:
·     the treatment of evidence and the conclusions reached regarding the form and content of a contractor agreement between Ms McDonald and Mr McCartney;
·     the weight which the Adjudicator attached to certain evidence concerning the processing of invoices;
·     the treatment of invoiced items claimed for the pursuit of “paperwork”;[6] and
·     the failure to “set-off” any amount against losses suffered by the appellant.[7]
[6] See paras [38], [59] – [60] below.
[7] See paras [39] – [40] below.
The substantial injustice alleged to be caused by the decision is that despite failing to provide the necessary signed service agreements, Mr McCartney would be paid by Ms McDonald in circumstances where Ms McDonald would not be able to recoup the funds from the NDIS due to the absence of signed service agreements.
The outline of submissions filed by Ms McDonald in support of the appeal comprises 52 paragraphs. The three (3) paragraph response from Mr McCartney says simply that there has not been any fresh evidence submitted and that it would be unjust to overturn the decision “that already underwent scrutiny of the evidence with both parties present to give context to the evidence.” Mr McCartney concludes by saying: “I completed the work, upon exiting I was told I would be paid for the work completed, then I wasn’t paid.”[8]
[8] This would appear to relate to the matters discussed at [9] above.
This is an application for leave to appeal or appeal. This is not an application to reopen the hearing. In a reopening application, the existence or otherwise of additional evidence, and the availability of that evidence at the time of the hearing might be relevant. An appeal is not an opportunity for the appellant to run their case for a second time. Leave to appeal will only be granted if there is demonstrated error in matters of fact and/or law on the part of the Adjudicator resulting in substantial injustice to the appellant.
Agreements
There are two types of agreement which were relevant to the issues in dispute. First, the contractor agreement that established the relationship between Ms McDonald and Mr McCartney whereby Ms McDonald, a NDIS registered provider, was able to process Mr McCartney’s invoices for payment. Second, were the service agreements between Mr McCartney and clients DL and BK which are to accompany the invoices lodged with the NDIS to enable payment to be made.
I.The contractor agreement
The appellant, in submissions paragraphs [4] to [11], says that it was unreasonable that the evidence of Mr McCartney (that there was a signed agreement) was accepted. Ms McDonald says her position was: “that we never signed the agreement and that I could not locate one,” but she accepted that there was an unsigned written agreement. The unsigned written agreement was not in evidence.
In submissions in the appeal at [9], Ms McDonald says that despite there being no evidence “relating to such an agreement” the Adjudicator implied “certain terms to the agreement.” Ms McDonald says in submissions at [11] that in finding Ms McDonald liable to pay Mr McCartney for work done “even though he had done it in breach of the requirements of the NDIS” the Adjudicator must have concluded that the agreement did not require the performance of work in a thorough, professional, and competent manner.”
The fact that there was an agreement between Mr McCartney and Ms McDonald is not in dispute.
Mr McCartney was not an employee of Evolution Psychology. Mr McCartney held an email address with the Evolution Psychology domain name, and he stored documents on an Evolution Psychology “portal” or “cloud” or “drive.” When the arrangement ended Mr McCartney no longer had access to the Evolution Psychology system.
In the hearing the Adjudicator and Ms McDonald referred to Mr McCartney as a contractor. Ms McDonald said her “oversight with support coordination with Michael was minimal.”[9]
[9]T1-13, lines 19 to 20.
In her response to the originating application, dated 17 December 2021, Ms McDonald described the business relationship as follows:
7. We agreed that he would work for as the support coordinator for DL and BK for the hours allocated by the NDIS for DL and BK for support coordination.
8. My rate is $98 per hour. Michael asked me to pay him $55 per hour. We eventually re-negotiated the rate to $60 per hour.
9. I provided Michael with an independent contractor agreement, but I do not recall whether it was ever signed. The agreement indicates that Michael would be paid $55 per hour.
Mr McCartney’s application included copies of a number of paid invoices as well as the unpaid invoices 281 and 254.
Common to all the invoices, is that they were billed by Mr McCartney to Evolution Psychology, and the “rate per unit” is $60.
Notations on invoice 254 (client DL) read “Updating Service Agreements” or “Updating Servicing Agreements to Mobilise Supports.” Briefly, Mr McCartney says there was a signed service agreement with DL; Ms McDonald says she does not have a copy of a signed service agreement.
The notation against some items on invoice 281 (client BK) say “SEE ATTACHED SERVICE AGREEMENT,” but on other items “Cancellations prevented signature.” Briefly, it was agreed that the relevant client service agreements with BK were not signed.
The paid invoices relate to either or both clients DL and BK. The fact that there are a number of invoices from Mr McCartney to Evolution Psychology that were paid suggests that in respect of those (paid invoices) there had been no unresolved issues in processing them through the NDIS portal.
As the registered provider, only Ms McDonald could process invoices to seek payment from the NDIS. Payment could only be secured by submitting the required paperwork through the provider portal known as “Proda.” Apart from the statement that the client service agreement is necessary “to process the invoice for payment and to confirm that the hours claimed are within the Support Coordinator allowance for the period claimed,” there is little evidence concerning the process undertaken between receipt of an invoice from Mr McCartney and the conversion of the invoice to an application for payment lodged via the NDIS portal.[10]
[10] See paras [42] and [43] below.
As Evolution Psychology is the registered service provider, it may be that it is an Evolution Psychology invoice which is processed through the NDIS portal, and if everything is in order, a payment is made from NDIS to Evolution Psychology, at the Evolution Psychology hourly rate of $98. From those proceeds, payment might be made to the contractor, in this case Mr McCartney. However, this process is not explained.
Mr McCartney does not say that client service agreements are not necessary. In fact, in evidence it seems accepted by him that client service agreements needed to be updated to enable him to continue to deliver services and implement plans. He says that he had secured a client service agreement with DL (which now cannot be found), and he had gone to significant effort to obtain a signed agreement from BK, but circumstances, including the fact that the arrangement (with BK) was ended, prevented the execution of the agreement. As discussed later in these reasons Mr McCartney says that BK “verbally signed the agreement.”
The ending of the McDonald/McCartney agreement was fairly informal. It ended not as the result of a dispute or tension. It ended because Mr McCartney believed support coordination required full-time effort to which he could not commit.
Findings by the Adjudicator – contractor agreement
The Adjudicator accepted the evidence of Mr McCartney that there was a signed contractor agreement. The Adjudicator asked Mr McCartney if the agreement contained a condition that made payment conditional upon the production of a signed service agreement between himself and the client. Mr McCartney said: “I don’t recall”.[11] He then said: My impression is that’s the best practice, that that is – that is.”[12]
[11]T1-17, lines 37 to 41.
[12]T1-17, line 45.
The Adjudicator found that it was not “a condition of payment that invariably, he had, when submitting an invoice or prior to it, to provide (Ms McDonald) with a signed service agreement between him and the client.” In the reasons for decision the Adjudicator says: “... I’m not satisfied that the agreement with you contained a condition precedent to payment, that a signed service agreement invariably be signed and in any event, consistent with Mr McCartney’s claim that your practice manager admitted liability for the invoices and said they would be processed for payment, which they weren’t.”[13]
Conclusion – contractor agreement
[13]T1-20, lines 22 to 26; the treatment of this evidence is discussed below at paras [42]-[44].
Ms McDonald does not argue that the contractor agreement in fact specified that signed service agreements must invariably accompany invoices because she says that that is a NDIS requirement and a person experienced in this sector would understand that. Mr McCartney expressed the view in the hearing that his impression was that the production of a signed service agreement was “best practice.” His invoices suggest that a signed service agreement was important – but statements such as “Updating Service Agreements” and “Cancellations prevented signature” also either suggest that he did not consider them critical, or that in the circumstances this was the best he could offer.
The Adjudicator noted in the hearing that invoice 281 referred to the need to have a signed agreement. In evidence, Mr McCartney said that he explained to BK that each new agreement had to be signed so that he could continue to deliver the services and implement the plan they had. This suggests a clear understanding by Mr McCartney that signed service agreements were a requirement for service delivery and for payment.
Ms McDonald, in submissions in the appeal, challenges the treatment of invoices claimed in the pursuit of paperwork. That is, the hours spent by Mr McCartney chasing signatures she says should have been secured before the work was undertaken. I find it difficult to reconcile Ms McDonald’s position that the invoices could not be processed because there was not a signed client service agreement, and the legitimacy of individual items claimed in the invoice. This again goes to the lack of evidence about the process undertaken by Evolution Psychology once an invoice is received, and before it is processed for payment through the NDIS.
The statement in Mr McCartney’s original response “… I provided the details and invoices for work completed and Evolution Psychology drew the funds down” is inconsistent with Ms McDonald’s evidence, and no evidence was led in support of the allegation. In her response to the originating application Ms McDonald claimed a “set off.” She says she suffered loss as a result of Mr McCartney’s failure to obtain a signed service agreement. The loss asserted is that Evolution Psychology did not recover any money for the invoices. Ms McDonald expands on this in her outline of submissions on appeal. The “set-off” is not quantified except that it should be the same amount that the Tribunal found Mr McCartney was owed.
It is hard to escape the conclusion that it would be an unlikely business arrangement if any and all invoices were accepted for payment without question, that is, if the coordinator (Ms McDonald) accepted liability to the contractor (Mr McCartney) for payment without complete confidence that the monies were recoverable (from the NDIS). It would also be alarming if the NDIS did not have a filter to ensure that all claims for payment met strict criteria. It is illogical to me that Ms McDonald, or anyone on her behalf, could or would commit to payment without a level of certainty that the amounts claimed were recoverable. In my view, the statement[14] that the invoices would be processed is equivocal. It does not mean that the invoices would be paid.
[14]See email dated 26 November 2020, Ms Pryde to Mr McCartney.
In my view, the evidence does not support the conclusion that the agreement between Ms McDonald and Mr McCartney provided that signed service agreements need not invariably accompany invoices. However, that of itself is not determinative of this application.

Findings by the Adjudicator - the 26 November 2020 email

Mr McCartney relied on the email from Ms Pryde stating that the invoices would be processed as confirmation that he had provided everything as required for payment. As noted earlier, the Adjudicator accepted that the content of the email amounted to an admission of liability.
Ms McDonald says that she spoke to Ms Pryde after the email was sent to remind Ms Pryde that they did not have the service agreements; that Mr McCartney needed to be contacted; and that the payments could not be made without the service agreements. Mr McCartney says there was no follow up meeting (after 26 November 2020) with Ms Pryde or Ms McDonald to try and resolve the issues.
Conclusion – the 26 November 2020 email
In my view the statement that the invoices would be processed is equivocal. It does not mean that the invoices would be paid. It is not an admission of liability. On this I believe the Adjudicator was in error.
II.The NDIS client service agreements

Evidence regarding NDIS requirements concerning client service agreements was given by Ms McDonald. At the hearing she said:
… With NDIS, participants have planned reviews all the time and every time there’s a review, they require a new service agreement to be signed in order for a service to be delivered … The service agreement is the – is just something between the participant and – and a provider of services and without a signed agreement, there – there’s no agreement. You – we’re talking about vulnerable people. We can’t just make claims to their funds without some sort of signed agreement because the NDIS won’t – they – they refuse to pay providers without – without it being signed by the participant or by the participant’s family, the family are the ones who, you know, take care of the matters for the person.[15]
…
It’s a requirement as a registered provider of NDIS services of which I am and is a requirement when a participant’s funding is managed by – well, their, you know, their – their support coordination funding is – managed by NDIS or if a – disability which renders them, you know, well would require an additional support, that – that a signed support agreement is – is made and it is definitely 100 per cent a requirement for the NDIS to make any – any payment through the provider portal for a service – signed service agreement to be submitted with – with any invoices.[16]
[15] T1-4, lines 2 to 11.
[16] T1-18, lines 5 to 12.
The material filed by Ms McDonald in response to the application indicates that a client service agreement will identify a maximum number of hours that can be claimed.
Invoice 254 – client DL
In respect of invoice 254 for services to client DL, when asked if there was a client agreement Mr McCartney said “yes” and that it was “all on the Evolution Psychology – the cloud drive, so it was all uploaded to that. That’s where it was – I don’t have – that wasn’t my property to keep.”[17]
[17] T1-6, lines 29 to 38.
At the hearing Mr McCartney said that “… there’s three service agreements that this relates to because there was a light touch review and another review, so there’s actually three agreements that overlap during this time. They were all signed, they were all put on the – so we – it was – it was managed through Google, a Gmail, so it was my email account and therefore, my appropriate storage – storage was [email protected], which I only had access to, I wasn’t an administrator of, which is where all the documents were stored…”[18]
[18]T1-8, lines 11 to 16.
When Ms McDonald was asked if it was accepted that the client agreement was on the Evolution Psychology cloud storage or drive she said: “I have searched for it … but Michael should have the original signed … or at least there’s an email or maybe perhaps on his computer but without that … I’m unable to submit anything to the NDIS. They … won’t accept anything without the relevant document … without the – the documents, the NDIS, they won’t let – they won’t allow me to submit anything. It – it would just – it would just be rejected.”[19]
[19]T1-7, lines 1 to 16.
Ms McDonald says that the Evolution Psychology system accounts were searched for the signed agreements and: “… it makes no sense that I would not want to pay Michael because that would – I would not get paid, either…”[20]
[20]T1-8.
Ms McDonald was adamant that she and the practice manager (Ms Pryde) had spent “countless hours” searching for the signed service agreements. Ms Pryde did not give evidence. Mr McCartney was adamant that he had signed service agreements, and stated “that was – they were – I provided everything.”
In email correspondence dated 26 November 2020, between Mr McCartney and Ms Pryde, the issue of computer system access came up. Mr McCartney had asked for access to retrieve certain material “from the EP Google drive for my records.” The request may be unrelated to the DL service agreements. Nevertheless, Ms Pryde said in response: “In relation to file access – we are unable to give you open access to the files as you are no longer an EP employee.” Ms Pryde went on to say that she intended “to go through the drive and the email folders and will send through to your personal email account any documents which do not relate to an Evolution Psychology client … If there are any documents of concern I will contact you to discuss on Thursday.”
In evidence Mr McCartney said that invoice 254 was not submitted “at the end, it was submitted through the long process with the NDIS.”[21] Ms McDonald said that she submitted the invoice to the NDIS: “and it was rejected ... because it didn’t have the correct documentation.” She said: “I tried every possible avenue. I requested through the NDIS, I even attempted, you know, to, you know, the - with the NDIS, I said to them, look, you know is it possible for Michael himself to submit these – the – the – the paperwork himself? … but they wouldn’t let me do it. I’ve literally tried every single avenue possible.”
[21]T1-10, lines 25 to 47.
The Adjudicator questioned Ms McDonald if she had asked Mr McCartney for the signed service agreement.[22] Ms McDonald said “Yes, I had many, many, many conversations with Michael … my practice manager at the time had many conversations with Michael about it …. we have gone to extreme lengths … to try to evidence this for Michael.” In response, Mr McCartney said that he did not know this (invoice 254) was even an issue – he thought invoice 280 “was the one.”
[22]T1-11, lines 27 to 40.
In terms of process, Ms McDonald offered her view that if Mr McCartney was able to produce the service agreement and the documentation was resubmitted through the NDIS portal, “The NDIS would then go to the family and they would say, you know, do you approve of these hours …” which has a bearing on whether or what the NDIS will pay.[23]
[23]T1-12, lines 5 to 10.
Conclusion – invoice 254
The evidence of Ms McDonald is that invoice 254 was submitted to the NDIS for payment but it was rejected for want of documentation. Ms McDonald received no payment in respect of invoice 254. There may be a disconnect between Mr McCartney’s evidence that the lodgement of invoice 254 “was submitted through the long process with the NDIS” and the searches for documentation undertaken by Ms McDonald and Ms Pryde.
All this begs the questions: despite the alleged many conversations, why did Ms McDonald not invite Mr McCartney to undertake a supervised search of the Evolution Psychology databases? If she did invite Mr McCartney, why was the invitation not accepted? Such a search could have clarified the existence or otherwise of the signed service agreement.
Based on my conclusions regarding the contractor agreement, I do not consider Ms McDonald liable to Mr McCartney for payment of invoice 254.
Invoice 281 – client BK
Once again there was no signed service agreement. Mr McCartney’s invoice included 21 hours attempting to have BK sign a service agreement. These hours seem to be the “invoiced items claimed in pursuit of paperwork” referred to in Ms McDonald’s particularised grounds of appeal. There was no finding in relation to the reasonableness of items claimed in the invoice.
Client BK suffered schizophrenia and had an acquired brain injury from alcoholism. Mr McCartney said that BK “verbally signed the agreement.” Mr McCartney explained that “this was at the beginning of the pandemic … not 12 months into the roll out of the of the scheme.” He said regular meetings were arranged with BK which did not occur for reasons including that the client had “forgotten” (about the meeting/s). Mr McCartney said that he explained to BK that each new agreement had to be signed so that he could continue to deliver the services and implement the plan they had. He said he asked BK if he consented to “working with these services” and told him that when they next saw each other they would sign the agreement. He said that he told BK that “I’ll just take the record that that we’ve had this conversation.” He said that he did not have the system for digital signatures. He noted that support coordination did not have to occur face to face. Mr McCartney said he had discussed this with Ms McDonald. Ms McDonald disagreed that it had been discussed.
The Adjudicator noted that the invoice referred to the need to have a signed agreement. Mr McCartney said that it was for work up to the date in the invoice as he had been directed to cease working with BK due to verbal abuse he was subjected to. Mr McCartney said it was not the case that he was “never getting an agreement.”
The evidence does not disclose if any attempt was made to process the invoice through the NDIS portal.
Conclusion – invoice 281
The reasons given by Mr McCartney for his failure to secure signed client service agreements with BK are understandable. I would be surprised if the circumstances were unique. However, the limited evidence (in relation to the processing of invoice 254) suggests that the NDIS are rigid in the requirement that documentation must be provided.
Ms McDonald received no payment in respect of invoice 281. Again, based on my conclusions regarding the contractor agreement, I do not consider Ms McDonald liable to Mr McCartney for payment of invoice 281.

Decision

I find error in the decision of the Adjudicator which has resulted in a substantial injustice to the appellant.
The stay of the decision is lifted.
Leave to appeal part of the decision is granted.
The appeal against that part of the decision concerning invoice 254 and invoice 281 is allowed.
Ms McDonald must pay Mr McCartney the sum of $2760.00 together with $127.50 filing fee.

Orders

1.        The stay of the decision is lifted.
2.        Leave to appeal part of the decision is granted.
3.        The appeal against that part of the decision concerning invoice 254 and invoice 281 is allowed.
4.        That part of the decision concerning invoice 254 and invoice 281 is set aside.
5.        Faith McDonald (Evolution Psychology) must pay Michael McCartney the sum of $2760.00, together with the $127.50 filing fee within 28 days of the orders in this matter being published.