Hopcroft, A.G. v Price, M

[1985] FCA 484

Re: ALAN GRAHAM HOPCROFT
And: MICHAEL PRICE and IAN FREDERICK TORRANCE
No. G6T of 1985
Administrative Law

COURT

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION
Lockhart J.

CATCHWORDS

Administrative law - Judicial review - committal proceedings - decision of Magistrate - circumstances in which Court will interfere with decisions in respect of committal proceedings - consideration of effect of Justices (Amendment) Act 1985 (N.S.W.).

Administrative Decisions (Judicial Review) Act 1977: s.5.

Health Insurance Act 1973: s. 129.

Justices Act 1902 (N.S.W.) : s. 41.

Justices (Amendment) Act 1985 (N.S.W.): ss. 2, 4(2).

HEARING

SYDNEY
#DATE 26:9:1985

ORDER

1. The application be dismissed.

2. The applicant pay the costs of the respondents of this application.
   
   NOTE: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

JUDGE1

This is an application under the Administrative Decisions (Judicial Review) Act 1977 ("the Judicial Review Act"). The applicant seeks a review of two decisions of the first respondent, a Magistrate of the Local Court of New South Wales, made in committal proceedings in respect of 18 informations laid by the second respondent alleging breaches by the applicant of sub-s. 129(1) of the Health Insurance Act 1973 ("the Health Insurance Act"). The first decision of the first respondent made on 18 March 1985 was in effect that in his opinion a prima facie case had been established against the applicant in respect of the charges. The second decision of the first respondent made on 28 March 1985 was to commit the applicant for trial in respect of the said charges.

All 18 charges relate to alleged overservicing of patients by the applicant, a medical practitioner, and all involve the construction of s. 129 of the Health Insurance Act which provides:

"129(1) A person shall not make a statement, either orally or in writing, or issue or present a document, that is false or misleading in a material particular and is capable of being used in, in connexion with or in support of, an application for approval for the purposes of this Act or for payment of an amount under this Act.

Penalty: $10,000 or imprisonment for 5 years.

(2) A person shall not furnish, in pursuance of this Act or of the regulations, a return or information that is false or misleading in a material particular.

Penalty: $10,000 or imprisonment for 5 years.

(3) In a prosecution of a person for an offence against this section, it is a defence if the person proves that he did not know, and had no reason to suspect, that the statement, document, return or information to which the prosecution relates was false or misleading, as the case may be.

The applicant is a specialist orthopaedic surgeon. He carries on practice at Taree as a sole practitionrer but in conjunction with other doctors in what is known as the Strathairlie Medical Centre ("the Centre"). The doctors do not carry on their practices in partnership, but they share common facilities and services. The applicant and a Dr. Thomas practice at the Centre. From time to time another junior doctor was employed at the practice and four lay staff were also employed there. Both the applicant and Dr. Thomas held recognised specialist qualifications enabling them to practice as specialist surgeons. Both doctors practiced also as general practitioners at the Centre.

The 18 charges fall broadly into three categories. The first of these involves six of the 18 charges where it is alleged that the applicant referred patients to Dr. Thomas by means of a referral signed by him, the reference being to Dr. Thomas for specialist services. It is alleged that in these cases the applicant made a statement in writing that was false or misleading in a material particular and was capable of being used in connection with or in support of an application for approval for the purposes of the Health Insurance Act or for payment of an amount under that Act within the meaning of sub-s. 129(1).

Central to the argument for the Crown was the proposition that s. 129 assumes that a medical practitioner will, prior to the issuing of a notice of referral, apply his own mind to the question of whether or not he will in fact issue the relevant notice. It was submitted that a medical practitioner who signs a referral for a patient represents to the patient and to the patient's health insurer that he has formed a deliberate and honest professional view that the proper professional treatment of the patient justifies the referral and the consequent payment from the health insurer's funds of a claim based upon the charging of a specialist fee fixed at a higher rate than the corresponding non-specialist fee. It was the Crown's case before the Magistrate during the committal proceedings that the applicant signed books of blank referral forms, that the other doctors at the Centre did the same, and that when patients were referred to Dr. Thomas pursuant to a referral notice over the signature of the applicant he had not himself seen the relevant patient for the purposes of the referral or in any way lent his mind to the question whether the referral should issue or not. It was not, however, part of the Crown case that for a referral notice to comply with the Health Insurance Act and the Health Insurance Regulations, a medical practitioner must necessarily first see the patient himself. In essence, what the Crown alleges is that at the Centre there were books of blank referral forms signed by the doctors concerned including the applicant and Dr. Thomas and that there was a system in force of mass referrals from one to the other. In these circumstances it was said that the applicant, when issuing the referral, made a statement in writing that was false or misleading in a material particular and otherwise contravened sub-s.129(1).

The second category of charges relating to s.129 are those in which patients were allegedly referred by Dr. Thomas or one of the other doctors who practiced at the Centre to the applicant in substantially the same circumstances as those to which I have just referred, namely, in circumstances where the mind of the referring doctor never went with the referral and that this was known to the applicant. It was said that when, with the authority of the applicant, accounts were sent to patients either with the referral notice attached or containing a reference to the referral and its number, the applicant issued a document that was false or misleading in a material particular and otherwise contravened sub-s. 129(1) of the Health Insurance Act. Some ten charges fall into this latter category.

Of the remaining two charges one involves the charging of a fee, so it is alleged, by directly billing the Commonwealth for an "out-of-hours" consultation when an "in-hours" fee, at a lesser rate, should have been charged. Under the system of claiming medical benefits in force at the relevant time the patient assigned his right to the receipt of medical benefits to the medical practitioner who performed the services. It was the prosecution's case that the applicant contravened sub-s. 129(1) in that, by submitting to the Health Authorities the relevant form of assignment and signing it himself, he made a statement that was false or misleading in a material particular for the purposes of the sub-section.

The remaining charge was one in which it was said that the applicant submitted to the Health Authorities an assignment form that was false in that it represented that the applicant had actually seen the patient for the purpose of enabling her to collect a repeat prescription, but in fact she had not been seen by him so that again there was said to have been the making of a false or misleading statement for the purposes of sub-s. 129(1).

The Table of Medical Services contained in the Schedule to the Health Insurance Act distinguishes between a lower (or general practitioner) rate and a higher (or specialist "referred patient") rate. The higher rate is only applicable in the case of patients who have been "referred".

Underlying the charges in the first two categories is evidence led before the first respondent to the effect that the patients concerned attended upon the treating doctor (whether the applicant or Dr. Thomas) as a "primary care" doctor, that is the patients attended the Centre and saw either the applicant or Dr. Thomas without having previously been "referred" from any other doctor. Each patient received an account from the Centre on behalf of either the applicant or Dr. Thomas, depending on who was their treating doctor, in which a charge was made at the "referred patient" rate apposite to specialist treatment. The "referred patient" rate of benefit would only be paid in cases where the claim in the form of an account was supported by a notice of referral. In each of the cases brought in these proceedings the account was supported by a notice of referral signed by a doctor with whom the relevant patient had no consultation or even discussion regarding the ailment in question. The evidence of the patient was that he or she had only seen the treating doctor, whether the applicant or Dr. Thomas as the case may be. In most cases the evidence of the patients was that he or she had attended the treating doctor in what the patient believed was the capacity of a general practitioner and in many instances the evidence was that he or she believed that the treating doctor was a general practitioner and had no knowledge of his specialist qualifications at any relevant time. The evidence of these patients tended to disclose that they had not been disabused of such a belief or had ever been informed that a notice of referral ought to be obtained or would be obtained.

The evidence led by the prosecution at the committal proceedings was to the effect that, unless the receptionist or other staff at the Centre were told otherwise, an "ordinary consultation" would be charged. In cases where a different charge was rendered the treating doctor would inform the staff of such an alteration to the ordinary course. There was evidence that books of blank referral notices, pre-signed by the relevant doctor but otherwise uncompleted, were kept available near the front desk where the clerical staff had access to them. The prosecution contended that in these circumstances it should be inferred that where the treating doctor decided to charge at a specialist "referred patient" rate and accordingly notified the clerical staff then the staff would append to the account a notice of referral already signed and made available by a different doctor within the practice. In other words it was a part of the prosecution's case that it was the treating doctor who really determined whether he should be paid at the general practitioner or specialist rate and that the treating doctor was the applicant in cases where a notice of referral was signed by Dr. Thomas in circumstances where Dr. Thomas did not lend his mind at all to the question of the referral, and vice versa in the case of the applicant where he was the doctor referring patients to Dr. Thomas. It was said therefore that the treating doctor purported to act as a specialist despite being unknown in most cases to his patients in that capacity, and that he "issued" the other doctor's referral which was available to him for that purpose. The inference according to the prosecution was that the doctor who had signed the notice of referral, whether before or after the other particulars were complete, "made a statement" that he had referred a patient which was an untrue statement. It was submitted that as the patients had not seen or spoken to the doctor who was held out as the "referring" doctor and had not being aware of the issue of a referral notice the inference could be drawn that there was no "referral". It was also submitted that the provision of a backdated referral notice enabled the patient to represent that he was a "referred patient" notwithstanding that at the time of the treatment by the specialist he in truth had not been a "referred patient".

There was a large body of evidence adduced at the committal proceedings by the prosecution and much of it is contested by the applicant. There is conflict between the applicant and the prosecution not only as to which evidence should be accepted but as to the inferences to be drawn from the evidence. There exists a further dispute as to the relevance of the evidence to the questions of interpretation of s.129 of the Health Insurance Act.

Counsel for both parties made submissions to the Court on the proper construction of s.129 and the relevant Health Insurance Regulations, in particular Reg.10 which relates to the referral of patients by one medical practitioner to another. The submissions covered various matters including the following:-

1. Whether the offences created by sub-ss. 129(1) and (2) were offences of strict liability. The current preponderance of judicial opinion is plainly in favour of the proposition that s.129 is a section imposing an offence of strict liability: see R. v. White; Walpole v. White (1979) 23 A.L.R. 432, a judgment of the Full Bench of the Supreme Court of Queensland.

2. Whether the legislative intent to be gleaned from s.129 is that a medical practitioner, before issuing a referral notice to a patient, shall apply his own mind in a real sense to the question of whether or not he will in fact issue the referral.

3. The definition of the word "referral" itself which is not defined in the Health Insurance Act or the Health Insurance Regulations. Indeed, the word is not to be found in the Health Insurance Act itself though it does appear in the Regulations including Reg. 10. There was evidence before the Court as to the meaning of the word as understood by the medical profession.

4. As to the two offences described by me as falling within the third category, various submissions were put before the Magistrate and mentioned before the Court as to the proper inferences to be drawn from the evidence of the witnesses at the committal proceedings.

In Lamb v. Moss (1983) 49 A.L.R. 533 a Full Bench of this Court said at p. 564:

"The power to make an order of review under the Act in respect of committal proceedings should be exercised only in most exceptional cases, especially in respect of a decision in the course of proceedings. Additional considerations might intrude at the final stage; for example, in respect of committal for trial and commitment to prison pending trial . . ."

Once committal proceedings have been completed an applicant for relief under the Judicial Review Act may more readily be able to establish that there are exceptional circumstances; but this must depend upon the circumstances of the case.

The reluctance of courts to interfere with the ordinary course of proceedings in the criminal courts is well established: see Sankey v. Whitlam (1978) 142 C.L.R. 1, especially per Gibbs A.C.J. at p. 26 and Clyne v. Director of Public Prosecutions (1984) 58 A.L.J.R. 493 per Gibbs C.J. at p. 494.

If the questions which fell for decision by this Court were simply questions of interpretation of s. 129 or of the Health Insurance Regulations, in particular Reg. 10, then the case for the intervention of the Court at this stage would be much stronger than it is. However, it is in my view difficult, if not impossible, to deal with the questions of interpretation divorced from conflicts of evidence or of inferences to be drawn from the evidence in the committal proceedings which occupied a considerable time and where the evidence is extensive.

There remains one final point. It was submitted by counsel for the applicant that the first respondent erred in his two decisions of 18 March 1985 and 28 March 1985 in that he failed to recognise the material differences that were made to the duies of magistrates in committal proceedings before and after the amendments to s. 41 of the Justices Act 1902 (N.S.W.) by the Justices (Amendment) Act 1985.

It became common ground before me towards the end of argument that s. 41(2)(b) of the Justices Act in the form which it took before the amendment applied to the first decision and that the section in its present form applied to the second decision. I have some doubt as to whether the first decision was governed by the previous form of the section: see Justices (Amendment) Act 1985, s. 2; N.S.W. Government Gazette published on Friday, 15 March 1985 notifying (Saturday) 16 March 1985 as the day on which the amendments to s. 41 shall commence; but see s. 4(2) of the Justices (Amendment) Act 1985. I note that the first respondent's decision pursuant to s. 41(2)(b) was announced in Court on Monday, 18 March 1985. This raises the nice question as to when he formed the requisite opinion within the meaning of s. 4(2)(a) of the Justices (Amendment) Act 1985.

I propose to consider the first decision on the basis accepted by the applicant before me, namely, that s. 41(2)(b) in its form before the amendment was the apposite statutory provision. Approached this way no ground was established for challenging the basis on which the first respondent made his first decision. However, if the first decision should have been made pursuant to s. 41(2)(b) in its present form, the first respondent may have fallen into error in approaching his task as he did. Nevertheless, even if he had erred in this respect I would not interfere with the decision. The first decision was followed by the second decision, ten days later, to commit the applicant. Unless that decision too was unsoundly based in law the appropriate course is for the processes of the criminal law to proceed in their usual way.

When the first respondent committed the applicant on 28 March the relevant provisions of the Amending Act were then in force, so that the task for the first respondent, after considering all the evidence for the prosecution and any evidence for the defence, was to form the opinion mentioned in s. 41(6)(a) or not form it. The opinion referred to in the paragraph is that "a jury would not be likely to convict the defendant of an indictable offence". If the first respondent formed that opinion he was required to forthwith order that the defendant be discharged. If he did not form that opinion his obligation was to commit the defendant for trial.

I have carefully read the reasons for the decision of the first respondent delivered on 28 March 1985 and in my opinion it is plain that he was conscious of the amendments that had been made to the Justices Act by the Justices (Amendment) Act 1985 and that he was seeking to reflect those changes when making the decision to commit. It has not been established to my satisfaction that the first respondent erred in approaching the question of the committal as he did. However, even if he had erred I am not persuaded that special circumstances exist such as to justify a review of his decision by this Court.

The application should be dismissed with costs.