Trustees of the Roman Catholic Church v NSW Department of Education

[2023] NSWSC 800

Supreme Court

New South Wales

Medium Neutral Citation:

Trustees of the Roman Catholic Church v NSW Department of Education [2023] NSWSC 800

Hearing dates:

21 June 2023

Date of orders:

21 June 2023

Decision date:

07 July 2023

Jurisdiction:

Common Law

Before:

Fagan J

Decision:

1. Order in terms of paragraph 1 of the Summons.

2. Defendant pay the plaintiff’s costs.

Catchwords:

STATUTORY INTERPRETATION – Children (Education and Care Services) National Law 2010 (NSW) – where delegate of regulator issued to plaintiff/authorised childcare provider a compliance notice – where original compliance notice alleged multiple breaches of provisions of the Act – where plaintiff sought internal review of decision to issue compliance notice – where second delegate of department conducted internal review – decision to “confirm” original notice but where particulars of alleged breaches materially different to original – where plaintiff sought internal review of secondary notice – issuance of second compliance notice amounted to fresh exercise of statutory power rather than confirmation of previous exercise – amenable to internal review

Legislation Cited:

Children (Education and Care Services) National Law 2010 (NSW)

Children (Education and Care Services National Law Application) Act 2010 (NSW)

Education and Care Services National Regulations (2011)

Category:

Principal judgment

Parties:

Trustees of the Roman Catholic Church for the Diocese of Maitland-Newcastle on behalf of St Nicholas Early Education trading as St Nicholas Early Education (plaintiff)
Department of Education (defendant)

Representation:

Counsel:
G Antipas (plaintiff)
D Birch (defendant)

Solicitors:
M Tuck in house Solicitor (plaintiff)
Crown Solicitors Office (defendant)

File Number(s):

2023/13163

JUDGMENT

1. The summons by which the plaintiff commenced these proceedings was filed on 13 January 2023. The first paragraph of the relief claimed is as follows:

1. 1. A declaration that the decision on 19 August 2022 by the Defendant to issue a compliance notice pursuant to section 177 of the Children (Education and Care Services) National Law 2010 (NSW) (“National Law”) to the Plaintiff (“19 August Decision”) is a reviewable decision for internal review for the purposes of section 190 of the National Law.

2. The proceedings were listed before me for final determination on 21 June 2023. At the conclusion of the hearing a declaration was made in the above terms and the defendant was ordered to pay the plaintiff’s costs. The Court’s reasons for decision were reserved and are now provided.

The issue

3. The issue raised by the summons is one of construction of the Children (Education and Care Services) National Law 2010 (NSW) (the Law). Section 9 of the Children (Education and Care Services National Law Application) Act 2010 (NSW) provides that the Secretary of the Department of Education is the Regulatory Authority for the purposes of the Law. For the sake of brevity in these reasons I will refer to the relevant decision maker as the Secretary or the Secretary’s delegate. The plaintiff is an “approved provider” under the legislation, having obtained approval under Pt 2 (ss 10-42) of the Law to provide education and care services for children under 13 years of age.

4. Section 177 makes the following provision for the Secretary to issue compliance notices:

177 Compliance notices

(1) This section applies if the Regulatory Authority is satisfied that an education and care service is not complying with any provision of this Law.

(2) The Regulatory Authority may give the approved provider a notice (a compliance notice) requiring the approved provider to take the steps specified in the notice to comply with that provision.

(3) An approved provider must comply with a compliance notice under subsection (2) within the period (being not less than 14 days) specified in the notice.

Penalty:

$6000, in the case of an individual.

$30 000, in any other case.

5. On 9, 10, 11 and 13 May 2022 authorised officers of the Secretary inspected centres, also called services, operated by the plaintiff in the Hunter Region and mid-North Coast. On 2 June 2022 a delegate of the Secretary (“the first delegate”) issued to the plaintiff a compliance notice under s 177 stating the Secretary’s satisfaction that, in the operation of the centres inspected, the plaintiff had failed to comply with the following sections:

167 Offence relating to protection of children from harm and hazards

(1)   The approved provider of an education and care service must ensure that every reasonable precaution is taken to protect children being educated and cared for by the service from harm and from any hazard likely to cause injury.

Penalty:

$10 000, in the case of an individual.

$50 000, in any other case.

175 Offence relating to requirement to keep enrolment and other documents

(1)   An approved provider of an education and care service must keep the prescribed documents available for inspection by an authorised officer in accordance with this section.

Penalty:

$4000, in the case of an individual.

$20 000, in any other case.

(2) Documents referred to in subsection (1)—

(a)   must, to the extent practicable, be kept at the education and care service premises if they relate to—

(i) the operation of the service; or

(ii) any staff member employed or engaged by the service; or

(iii) any child cared for, or educated at, those premises—

in the previous 12 months; and

(b)   in any other case, must be kept at a place, and in a manner, that they are readily accessible by an authorised officer.

The documents prescribed for the purposes of s 175(1) include staff records containing details of relevant training and qualifications: regs 145 and 147 of the Education and Care Services National Regulations (2011).

6. The notice of 2 June 2022 also asserted non-compliance with the following regulations:

reg 75(1) requiring information about a child care centre’s education program to be displayed and available for inspection;

reg 97(4) requiring display of an emergency and evacuation plan and

reg 103(1) requiring that furniture and equipment be kept clean and in good repair and condition.

7. The issue of such a notice under s 177(1) has potentially significant consequences for an approved provider. This particular notice required compliance within 14 days. Default would attract a penalty of $30,000 as provided for in s 177(3). Default could be viewed by the Secretary as ground for issuing a notice under s 178(2), to show cause why the plaintiff should not suspend its provision of education and care services, or under s 183(1), to show cause why the plaintiff should not be prohibited from continued involvement in the education and childcare field. Part 5 of the Law (ss 133-160) provides for a system of assessment and rating of education and care services, for the purposes of which an approved provider’s compliance record is taken into account: ss 135(2)(c), 153(4)(b). The process of assessment and rating may be suspended while any compliance notice is outstanding: s 137(1)(b). Rating levels are published: s 160.

8. Division 1 of Pt 8 of the Law, comprising ss 190-191, provides for internal review by the Secretary of decisions that have been made under specified sections of the Law. Division 2 of Pt 8 provides for external review of decisions within nominated categories. External review is by the tribunal specified for the purposes of the Law, namely, the NSW Civil and Administrative Appeals Tribunal.

9. The question that arises in the case is this:

Following an internal review under s 191 of a decision to issue a compliance notice pursuant to s 177, if the review culminates in a decision to confirm the compliance notice in substantially altered terms does the approved provider have a right of internal review of the latter decision?

10. To answer the question it will be necessary to interpret and apply ss 190 and 191 of the Law, which are in the following terms:

Part 8 Review

Division 1 Internal review

190 Reviewable decision—internal review

A reviewable decision for internal review is a decision of the Regulatory Authority under this Law as applying in any participating jurisdiction—

(a) to refuse to grant a provider approval or a service approval; or

(b) to amend or refuse to amend a provider approval or a service approval; or

(c) to impose a condition on a provider approval or a service approval; or

(d) to suspend—

(i) a provider approval under section 28; or

(ii) a service approval under section 73; or

(iii) a supervisor certificate under section 126; or

(e) to refuse to consent to the transfer of a service approval; or

(f) to revoke a service waiver; or

(g) to issue a compliance direction; or

(h) to issue a compliance notice.

191 Internal review of reviewable decisions

(1) A person who is the subject of a reviewable decision for internal review may apply to the Regulatory Authority in writing for review of the decision.

(2) An application under subsection (1) must be made—

(a) within 14 days after the day on which the person is notified of the decision; or

(b) if the person is not notified of the decision, within 14 days after the person becomes aware of the decision.

(3) The person who conducts the review for the Regulatory Authority must not be a person who was involved in the assessment or investigation of the person or service to whom or which the decision relates.

(4) The person conducting the review may ask the person who applied for the review for further information.

(5) A review under this section must be conducted within 30 days after the application is made.

(6) The period specified in subsection (5) may be extended by up to 30 days—

(a) if a request for further information is made under subsection (4); or

(b) by agreement between the person who applied for the review and the Regulatory Authority.

(7)   The Regulatory Authority may, in relation to an application under subsection (1)—

(a)   confirm the decision; or

(b)   make any other decision that the Regulatory Authority thinks appropriate.

11. The decision of the first delegate to issue the compliance notice of 2 June 2022 was amenable to internal review pursuant to s 190(h). On 16 June 2022 the plaintiff applied for internal review. On 19 August 2022 that application was determined under s 191(7)(b) by a different delegate (“the second delegate”), who purported to confirm the original compliance notice in substantially different terms. The answer to the central question in the case will require comparison of the terms of the original notice with those of the notice that was issued on 19 August after the internal review.

The plaintiff’s education and care services

12. The plaintiff operates 33 centres for the care of children out of school hours, referred to in the proceeding by the acronym “OOSH centres”. It also operates 12 early childhood learning centres in which day care and educational activities are provided for children who range in age from very young toddlers up to the age of preparation for kindergarten. Through its centres the plaintiff provides care to approximately 5,200 children.

13. The centres are operated on a not-for-profit basis. There is evidence before the Court that many of the clients of the business are families wherein both parents work. There is a strong inference that the scope for the plaintiff to increase its charges, in order to cover additional operating expenses including the cost of complying with statutory requirements and Departmental directions, is very constrained. The plaintiff’s enterprise is heavily and closely regulated under the National Law, as is apparent from the numerous and detailed provisions of the Law and the Regulations. The defendant’s counsel described the statutory regime in these terms:

The National Law and National Regulations make detailed prescription in respect of almost every conceivable matter relevant to the establishment and operation of education and care services.

14. This superstructure of minute regulation comes at significant cost, and with considerable burden and absorption of resources – for government, for approved providers and for the users of their services. The burden of heavy regulation is illustrated in this case by evidence of the manner in which authorised officers of the Secretary have scrutinised the operation of some of the plaintiff’s centres and by the documentary evidence of the plaintiff’s painstaking and protracted efforts to reason with Departmental offices about the impracticability of their enforcement directions.

The original compliance notice: 2 June 2022

15. The aspect of the 2 June 2022 compliance notice that most strongly spurred the plaintiff to seek internal review was the delegate’s assertion that s 167(1) had been breached with respect to the plaintiff’s preparedness, at some of its centres, for managing children who suffer from asthma. Those aspects of the 2 June notice require close consideration because in the 19 August notice, issued after the internal review, the second delegate identified entirely different alleged failings of the plaintiff and directed entirely different steps that she required the plaintiff to take in order to achieve compliance.

16. The following is an abridged reproduction of particulars given in Annexure A of the 2 June notice, being matters of alleged non-compliance with s 167(1) at six of the plaintiff’s OOSH centres. The date of attendance by the Secretary’s authorised inspection officers is noted in this summary and the children’s names are anonymized. For ease of reference there has been assigned to each particular the number that was subsequently used by the second delegate in the internal review:

Abermain, 10 May 2022

1. The medical management plan to manage the asthma medical condition of child EF (DOB: x/y/2014) states that the oral prednisolone, Moktelukast 4MG, is to be administered when the asthma condition is severe. Montelukast 4MG medication was not available at the service for EF.

A letter from the parent of EF states that Montelukast 4MG is only administered at home, however this is not in accordance with the information provided by a medical practitioner on the child's asthma medical action plan.

[…] responsible person Raymond LANDELL confirmed that EF is currently enrolled and attending the service this week [… and] that he was unaware that Moktelukast 4MG medication is required to manage the asthma medical condition of EF.

Branxton, 11 May 2022

2. [Redipred not available for management of asthma of EW (DOB: x/y/2013) in accordance with her medical action plan. Responsible person Rowan WISEMAN confirmed EW’s enrolment but was unaware that Redipred is required to manage EW’s asthma].

3. [Redipred not available for management of asthma of FM (DOB: x/y/2015) in accordance with his medical action plan. Responsible person Rowan WISEMAN confirmed FM’s enrolment but was unaware that Redipred is required to manage FM’s asthma.

4. [Prednisolone medication not available for management of asthma of PG (DOB: x/y/2016) in accordance with her medical action plan. Responsible person Rowan WISEMAN confirmed PG’s enrolment but was unaware that Prednisolone is required to manage PG’s asthma].

5. Prednisolone not available for management of asthma of HG (DOB: x/y/2013) in accordance with his medical action plan. Responsible person Rowan WISEMAN confirmed HG’s enrolment but was unaware that Prednisone is required to manage HG’s asthma].

Lochinvar, 11 May 2022

6. [Redipred not available for management of asthma of CH (DOB: x/y/2012) in accordance with her medical action plan. Responsible person Melanie CAUCHI confirmed CH’s enrolment but was unaware that Redipred is required to manage CH’s asthma].

Maitland, 9 May 2022

7. The medical management plan to manage the asthma […] of TM (DOB: x/y/2016) states that Ventolin and Redipred medication is required to support this medical condition. The Ventolin medication available at the service for TM expired in April 2022. No Redipred medication was available at the service for TM. TM was in attendance at the service during the visit. Responsible person Mellisa RODGERS confirmed that she was unaware that Redipred medication is required to manage the asthma […] of TM.

Rutherford, 9 May 2022

8. [Prednisolone not available for management of asthma of] RD (DOB: x/y/2014) in accordance with his medical action plan in the event of severe asthma. RD was in attendance at the service during the visit].

9. [Redipred not available for management of asthma of BN (DOB: x/y/2016) in accordance with his medical action plan in the event of severe asthma. Responsible person Desilee HOWARD confirmed BN’s enrolment but was unaware that Redipred is required to manage BN’s asthma].

Scone, 10 May 2022

10. [Redipred medication not available for management of asthma of NW (DOB: x/y/2014) in accordance with his medical action plan. Nominated supervisor Michelle MILLER confirmed NW’s enrolment but was unaware that Redipred is required to manage NW’s asthma].

Rutherford, 9 May 2022

11. [Claratyne not available for management of asthma of MW (DOB: x/y/2016) in accordance with his medical action plan in the event of a runny nose or cough developing. Responsible person Desilee HOWARD confirmed MW’s enrolment but was unaware that Claratyne is required to manage BN’s asthma].

Scone, 10 May 2022

12. BH (DOB: x/y/2011) had Ventolin medication available at the service, however, no medical management plan was available to support the administration of Ventolin medication to BH.

13A. The risk minimisation and communication plan for MP (DOB: x/y/2015) states Ritalin medication is only to be administered at home. Ritalin medication for MP was available in the first aid kit and was administered to MP by educators at the service on 11/04/22 and 20/04/22. Nominated Supervisor Michelle MILLER confirmed that the risk minimisation and communication plan for MP had not been updated to reflect the current requirement for Ritalin medication to be administered by educators at the service.

13B. On the 20/04/22, Ritalin medication was administered to MP at 12:19 by educators at the service. Educators at the service failed to document the last dosage administered time on the medication form on 20/4/2022.

17. The notice directed the plaintiff within 14 days to take the following steps to remedy the above particulars of alleged non-compliance with s 167(1) (emphasis added):

1.   The approved provider must deliver training and professional development to all educators centred on the management of asthma medical conditions. In particular, the thorough review of asthma medical action plans and the implementation of systems to ensure that all required medication is accessible at the service prior to enrolment or upon diagnosis of any child with an asthma medical condition.

2.   The approved provider must ensure that all educators read and sign all policies and procedures relating to the management of medical conditions and the administration of medication.

3.   Evidence of the education and training being provided and all staff members completing the training needs to be provided to the department.

4.   Evidence of training needs to:

Include training attendance records.

Include copies of training materials and training guides provided to staff members.

Demonstrate how this education and training was delivered.

Demonstrate how you will in the future ensure that the nominated supervisor and staff members at the service will follow these policies and procedures.

Internal review – particulars 1, 11 and 12 of breach of s 167

18. When the Secretary’s delegate determined the plaintiff’s application for review on 19 August 2022, items 1, 11 and 12 of the particulars of breach of s 167 were withdrawn. The fate of those particulars will be explained first, because nine of the remaining 10 are a homogenous group and the plaintiff’s grounds for seeking review of them, as well as the second delegate’s decision on them, can thereafter be considered collectively.

19. On internal review, the second delegate was not satisfied that the children concerned in particulars 1, 11 and 12 were exposed to harm as a result of the circumstances recorded by the inspectors. The second delegate therefore could not find a breach of s 167, as would have been necessary to justify inclusion of those particulars in the 2 June notice. The following circumstances concerning the initial inclusion of the particulars and their withdrawal on review are pertinent.

18. With respect to item 1, the allegation of failure to take “every reasonable precaution” to protect EF from harm was that Moktelukast was not available at the centre. Breach of s 167 was alleged despite a letter from the child’s parents that this medication was to be administered only at home. It is clear that the authorised inspector was not medically qualified. Rather than make further inquiry to reconcile the parents’ instructions with the inspector’s erroneous interpretation of the child’s medical management plan, the first delegate included this allegation in the compliance notice. On review, the second delegate reversed this particular, on the following basis:

I have conducted online research, which indicates that Moktelukast is a once-per-day medication to be taken at night. Moktelukast is not used to treat a sudden attack of asthma symptoms.

21. It appears unsatisfactory, to say the least, that medically untrained personnel should, in the name of the Secretary, formally allege on medical grounds that an offence has been committed contrary to s 167, carrying a $50,000 fine, and issue a statutory notice for which non-compliance attracts a $30,000 fine. On 19 August 2022 “online research” was considered by the second delegate sufficient to show that by following parental instructions, which accorded with the nature of the medication, the plaintiff took “every reasonable precaution” as required by the Law. It is difficult to see why the inspector and first delegate should not have been sufficiently trained either to refrain from making medical judgments beyond their expertise or to make the online inquiry themselves, before imposing upon an authorised provider the risk and burden of dealing with a compliance notice that was unjustified in this material particular.

22. Regarding item 11, in support of the review the plaintiff explained that, from the point of view of child safety, no medical significance could be attached to the absence of Clarityne from the Rutherford centre. The plaintiff made the following submission:

Claratyne is a once-a-day medication that reduces the effects of an allergic reaction. It is not a medication with immediate and life-saving effect. In most cases, parents have determined this is not needed at an OOSH service (as they would generally administer in allergy season at home for the once-a-day impact).

23. The second delegate arrived at the same conclusion. She ascertained that Clarityne is a tradename for a drug also known as Claratin and Loratadine. The second delegate gleaned the following information, presumably also from the internet:

Claratin (Loratadine) is a long lasting, non-sedating antihistamine that is used for the treatment of allergies. No prescription is required for this medication. The usual dosage for children older than six years of age [MW was six] is 10 mg daily. […] The medication does not act with immediate effect.

24. The observation made above in relation to item 1 may also be made concerning this particular and its withdrawal. If medically unqualified inspectors are to be deployed it would be a reasonable expectation of the public generally, of approved providers and of the families that use these services, that the inspectors would at least be trained to inquire into the significance, or otherwise, of a well-known non-prescription medication before alleging an offence and issuing a compliance notice.

25. With respect to particular 12, the Scone service did have on hand a medical management plan for BH, prepared by the Australasian Society of Clinical Immunology and Allergy (“ASCIA”). The plan was signed by the plaintiff on 1 April 2022 and by the child’s mother on 5 April 2022. It specified that in the event of anaphylaxis, Ventolin was to be administered after an adrenaline injection. By inadvertence the box adjacent to that instruction had not been ticked but the plaintiff’s staff understood that it was applicable to both the adrenaline injector and the Ventolin and, as supplied to the centre by the child’s parents. Understandably, the second delegate disagreed with the allegation in the 2 June 2022 notice that “no medical management plan was available to support the administration of Ventolin medication to BH”. The manifestly trivial error of inadvertent failure to tick a box did not give rise to a breach of s 167(1) and this particular was not included in the notice issued on 19 August 2022.

Internal review – particulars 2-10 of breach of s 167

26. Items 2-10 of the breaches of s 167 particularised in the 2 June notice, summarised at [16] above, concerned the absence from the plaintiff’s respective centres of the medications Redipred or Prednisolone. Each particular referred to a management plan that had been provided to the plaintiff by parents and/or a medical practitioner in respect of a child who was a disclosed asthma sufferer. Where those plans prescribed Redipred or Prednisolone to be used in nominated circumstances, the inspectors and the first delegate formulated alleged breaches of s 167 on the assumption that the intent of the management plans was that every person or institution who might have care of the child from time to time would stand ready to administer the drug.

27. The plaintiff’s detailed submissions supporting its application for review strongly refuted the delegate’s assumption, as follows:

1 The breaches identified are unreasonable and not based on medical advice

Asthma and allergy management plans are developed by medical practitioners with a whole of life approach and so are intended for a wider audience than childcare or education services. These plans cover long term preventative strategies and so contemplate medication that may be administered in the mildly symptomatic phase like claratyne, flixotide and seritide. They also cover strategies for when symptoms persist or when life-saving measures are required, hence the reference to medication for use when symptoms have become acute like redipred (or other forms of prednisolone or steroid medications).

It is submitted these plans do not equate to medical direction that preventative or acute phase medications be held on-site by each care or education service the child attends. For example, the expectation of assessors that preventer medication administered once a day at home or medication given in acute phases only where a child would likely not be well enough for School or OOSH, be available ·at the services is unreasonable.

[…]

Not having prednisolone (Redipred and other brand names) on site: This is administered in acute phases of asthma when the child is seriously unwell and is also a once a day medication (at least in the circumstances it has been observed in asthma action plans by the service) and as noted above once a day medications are generally administered in the home environment unless there is a specific timeframe within service and attendance hours.

In the circumstances where prednisolone is required, the child would not likely meet the requirements of being well enough to be at school or OOSH, and St Nicholas would not generally accept a child that unwell. In addition, this medication has a short shelf life (1-3 months) and feedback from parents is that there is a general reluctance for GPs or specialist to provide additional scripts as the general expectation is that at this point of an asthma event the child is being managed directly by a doctor.

2 The compliance requirements are unduly onerous on both the approved provider and the families served.

Parents have a right to determine what care their child receives while at OOSH, and strong relationships exist between St Nicholas staff and parents around their child's needs. Where a parent, as part of a collaborative Risk Minimisation Plan, instructs St Nicholas that a certain medication is not required to be administered in the OOSH or early education environment it is not appropriate for the Trustees or their representatives to dispute this, unless the plan clearly states something to the contrary that is relevant to the specific service environment.

Similarly, it is not appropriate for the regulatory authority to discount or disregard the authority of a parent who in the discharge of their parental responsibility gives a direction to St Nicholas that certain medications are not intended or required to be administered at the service.

3 The expectations of the regulatory authority are outside of societal expectations.

The approach of the regulatory authority to insist that costly and not used medications be available at each service notwithstanding clear parental direction to the contrary is unreasonable and outside of societal expectations. The regulatory authority may be at risk of deterring parents from disclosing medical conditions should families continue to be subject to the onerous and expensive requirement of having in-date preventative and acute phase medication on-site at each service attended by a child with an asthma plan - medications which would be difficult to obtain additional scripts for, often have a short shelf life (1-3 months for various prednisolone mixtures) or be high cost (a simple internet search shows Avamys available with a script at $69.95 per bottle).

28. In conducting the internal review the second delegate ascertained that Redipred is a tradename for an orally ingested medicine in which the active ingredient is Prednisolone or a compound thereof. The second delegate’s reasons for decision included the following at p15:

I have conducted online research, which indicates that Redipred/Prednisolone is used in the treatment of many different conditions, including severe allergies and severe or chronic asthma. Redipred/Prednisolone is only available with a doctor’s prescription.

[…] Redipred should be discarded 4 weeks after opening.

Oral corticosteroids, such as Redipred/Prednisolone are powerful anti-inflammatory medicines, which help by quickly reducing the swelling in the lungs. They are much stronger than the inhaled corticosteroid in the preventer inhalers. They usually only take up to 1-2 hours to start working.

29. At pp 15-18 of the second delegate’s reasons for decision on the internal review she acknowledged that the plaintiff had no authorisation from parents to administer medication other than Ventolin or Zempreon inhalers, for any of the children concerned in particulars 2-10. The plaintiff’s failure to have on hand Redipred/Prednisolone, a medication that the plaintiff’s staff had no authority to give to children in its care, could not have constituted a breach of s 167. However, the second delegate found that the section had been breached in relation to these children in a different respect, deriving from what she perceived to be conflict between the generic asthma management plans with which the plaintiff had been provided and the limited scope of authority that parents had given for the administration of medicines.

30. The second delegate said this at pp 19-20 of her reasons o 19 August 2022:

Although there are certainly indications that staff at the service are not meant to administer Redipred / Prednisolone, there is a lack of clarity around this and, in particular, in the instructions in the asthma action plan. I agree with the [plaintiff] that the plans are generic in nature and are intended to cover all situations, not just the child's attendance at an education and care service. This is part of the overarching problem. In this respect, whilst noting that in the event of an asthma attack the asthma emergency instructions are likely to be followed, I consider that there is the potential for confusion in a situation where a child's symptoms become worse, particularly in cases where the asthma action plans are not clear in their instructions with respect to the child's care at the service. Of particular concern, are the examples where plans state that the child is to start Redipred "straight away". This problem is heightened where the risk minimisation plans and the authorisations for the administration of medication are incongruous with the asthma action plans, which, in my opinion, may result in the children being exposed to harm. Further, Redipred and Prednisolone are powerful anti-inflammatory medicines, which usually only take up to 1-2 hours to start working. They are also known as rescue medication. Under these circumstances, the failure to administer this medication, if meant to be administered, could certainly expose a child to harm.

[…]

In my view, the risk of harm to the children arising from potential confusion regarding the administration of medication due to the presence of generic asthma action plans that are not tailored specifically for the service environment was an identifiable risk. This now directs attention to the precautions that could have been taken to prevent the risk.

A reasonable precaution would have been to ensure that the children's asthma action plans were specific to the service environment. such that there can be no lack of clarity about the medication that the service is, and is not, expected to administer.

Plans that cater specifically for the education and care service environment are available from the Asthma Australia website. With regard to respect for parental authority, it is not a sufficiently reasonable precaution for a child's parent to indicate that the service is not required to administer certain medication in the face of an asthma action plan prepared by the child's doctor which, on a plain reading, indicates something to the contrary.

Sufficient asthma action plans would leave no room for doubt as to the requirement (or otherwise) to administer and keep medications such as Redipred / Prednisolone at the service premises.

Given the above, I am satisfied that the elements of each of the offences outlined at allegations 2-10 above have been made out with respect to section 167(1) of the National Law. Having come to this conclusion, I am satisfied that, for the purposes of issuing a compliance notice, the relevant services were not complying with section 167(1) of the National Law. As I am satisfied that there has been a failure to comply with the National Law, it is necessary for me to consider whether it was an appropriate sanction to issue a compliance notice in respect to the alleged contravention.

31. At p 20 of the second delegate’s reasons, the following appears:

The Applicant states that the breaches identified are unreasonable and not based on medical advice. It is not appropriate for the regulatory authority to discount or disregard the authority of a parent who, in the discharge of their parental responsibility, gives a direction in relation to the administration of medication. The cost of having preventative medication on site is onerous and prohibitive. The issue of a compliance notice is not proportionate to the seriousness of the offence.

While I accept the practical nature of the Applicant's submissions, the production of a medical management plan specifically tailored for the care environment will cure the issues raised. In this respect, there would be no reference to preventative medication in a medical management plan unless such medication was actually required at the service. As previously indicated, there is potential for confusion in a situation where a child's asthma symptoms worsen and the risk minimisation plans and authorisations to administer medication are incongruous with the asthma action plans, with the possible result that the children may be exposed to harm.

Internal review – particular 13 of breach of s 167; sundry other breaches

32. In the 2 June compliance notice, particular 13 of breach of s 167 comprised a very minor oversight, on a single occasion, of failing to record the time, as well as the date, of administering a lunchtime dose of Ritalin, a medication for the treatment of Attention Deficit Hyperactive Disorder. The breach also encompassed failure to update the child’s management plan, although he was not due to return to the centre for about seven weeks. The second delegate did not see fit to withdraw this particular.

33. Two breaches of s 175 of the Law were particularised in the 2 June notice, resulting from the plaintiff not having had on hand at its Maitland and Rutherford centres full hard copy staff records for two of its employees. The records were held by the plaintiff centrally in electronic form and, in the case of one staff member, a record of her own qualifications was available for inspection on a mobile phone. All required records were were readily available, but not in hard copy at the respective centres. The second delegate dismissed the plaintiff’s submission that this was a merely technical breach, not warranting the issue of a compliance notice. The second delegate said, at p 26 of her reasons:

[The] Legislation clearly requires that the records be available at the service premises. Records held in a central location do not meet this criterion, irrespective of the ease in which they may be produced.

34. With respect, having regard to contemporary electronic record keeping systems in the year 2022, this is a questionable conclusion, with no practical utility to the objects of the legislation. The evidence shows that each of the plaintiff’s centres has access to its central repository of the required records via computer terminal located at the service premises – either by online access or by email transmission of an attachment, the evidence does not specify which. In the present case the plaintiff contends that when the alleged breach was recorded by the inspector a reasonable opportunity was not afforded for retrieval of the centrally held record by this means. In any event, it appears that that would not have satisfied the Secretary. The utility of enforcement at this level of detail is not immediately apparent.

35. One breach of reg 75(1) was specified in the original compliance notice, namely, that information about the educational program for the plaintiff’s service at Taree was not available for inspection at the premises. A single breach of reg 103(1) was particularised as wear to a soft fall mat beneath play equipment at the same centre. A single breach of reg 97(4) was particularised as failure to display prominently an emergency and evacuation floor plan and instructions at Rutherford. The second delegate found that these breaches were sustained but accepted the plaintiff’s submission that they did not warrant inclusion in a compliance notice. With respect to the breach of reg 103(1), the second delegate saw fit to issue a compliance direction pursuant to s 176, in place of the compliance notice.

Characterisation of the internal review decision of 19 August 2022

36. The second delegate stated her decision on the plaintiff’s review application as follows:

[In] the exercise of power delegated by the Secretary, Department of Education, I have decided to:

-   confirm the issue of the compliance notice with respect to ten of the 13 allegations pertaining to section 167(1) of the National Law, but alter the terms of the steps required to comply with the provision;

-   withdraw the compliance notice and amend the [plaintiff’s] compliance history with respect to three of the 13 allegations pertaining to section 167(1) of the National Law;

-   confirm the issue of the compliance notice with respect to the two allegations pertaining to section 175(1) of the National Law, but alter the terms of the steps required to comply with the provision;

-    withdraw the compliance notice with respect to the allegation pertaining to regulation 103(1) of the Regulations and issue a compliance direction in its place, including an amendment to the steps required to comply with the provision; and

-   withdraw the compliance notice with respect to the allegations pertaining to regulations 75(1) and 97(4) of the Regulations

37. The second delegate’s reasons were accompanied by a document entitled Compliance Notice dated 19 August 2022. With respect to the most substantial aspects of alleged non-compliance, which were items 2-10 in breach of s 167 as specified in the 2 June notice, the 19 August compliance notice again alleged breaches with respect to the same children at the same care centres but identified a different shortcoming and a different remedy. On 2 June the failure was said to be the absence of Redipred / Prednisolone at the plaintiff’s centres. On 19 August it was said to be that management plans provided to and held by the plaintiff did not make clear that staff at the respective centres were not required or authorised to administer this medicine.

37. The 19 August notice stipulated the following “Steps to be taken to comply” with s 167:

The approved provider must undertake a thorough review of asthma action plans and other medical management plans and ensure that they are specifically tailored for the education and care service environment.

That direction is to be contrasted with the “Steps to be taken”, quoted at [17] above, that were specified in relation to breaches 2-10 in the 2 June notice. There is no overlap.

39. The alternatives available to the second delegate pursuant to s 191(7) were to “confirm” the original decision or to “make any other decision that the Regulatory Authority thinks appropriate”. By no straining of statutory language could it be said that the decision to issue the 19 August notice was to “confirm” the issue of the 2 June notice. That characterisation might have been placed upon the 19 August decision if it had simply withdrawn from the 2 June notice some of the allegations of breach and/or some of the steps required to be taken. However, a notice that not only withdrew a number of alleged breaches but also particularised some of the original breaches in different terms and directed that different rectification be undertaken went well beyond confirmation.

40. Necessarily, therefore, the decision of 19 August was “any other decision that the Regulatory Authority thinks appropriate”. On my interpretation of s 191(7)(b) the “any other decision” must find its source of power in another enabling provision of the Law. Section 191(7)(b) is not a substantive source of authority for the Regulatory Authority to make any decision that it wishes, unconstrained. Part 7 of the Law confers upon the Secretary a wide range of powers to be exercised for the purposes of enforcement. “Any other decision” made pursuant to s 191(7)(b) must be supportable by reference to a power-conferring section, either in Pt 7 or elsewhere in the Law. To read s 191(7)(b) any other way would involve attributing to it a freestanding source of unlimited power, because that subsection does not contain within itself any restriction. The scope and limits of “any other decision” must be found in the substantive sources of power specified elsewhere in the Act. In my view it follows that the second delegate was only empowered to make the decision of 19 August to issue a compliance notice materially different from that of 2 June by undertaking a fresh exercise of the power conferred by s 177(2). The decision of 19 August therefore falls within par (h) of s 190 as being of a type that is amenable to internal review under s 191.

41. The defendant submits that the decision to issue the 19 August notice was not made under s 177 but under s 191 and that the decision therefore does not fall within any of the paragraphs of s 190 that permit internal review. This argument is said to be supported by s 192(a), which is as follows (emphasis added):

192 Reviewable decision—external review

A reviewable decision for external review is—

(a) a decision of the Regulatory Authority made under section 191 (other than a decision in relation to the issue of a compliance direction or a compliance notice)

42. Section 192 goes on to specify in par (b) seven other categories of decision from which an external review is available. I do not accept that s 192(a) assists the defendant’s argument. Certainly, the provision denies external review of a decision that has been made under s 191 upon internal review of a compliance notice. However, that does not dictate, nor even suggest, that when an internal review of a compliance notice is resolved under s 191(7)(b), the “any other decision” then made must be regarded as only referable to s 191(7)(b) and not to the substantive power, located elsewhere in the Law, upon which the “other decision” draws. Contrary to the defendant’s submission I do not consider that the words “in relation to” indicate that the issue of a fresh compliance notice by way of resolution of an internal review must be regarded as a decision made “under” s 191 and not “under” s 177, for the purposes of applying s 190(h). Possibly, some types of “other decision” made under s 191(7)(b) at the conclusion of an internal review of a compliance notice may not constitute the exercise of a power that falls within s 190(a)-(h). In the present case, where the “other decision” is to issue what amounts to a substantially new compliance notice, the power provided for in s 177 has been exercised and s 190(h) is engaged with respect to that exercise.

43. The defendant further submits that to interpret the provisions as permitting an internal review of the 19 August decision would give rise to the “unpalatable”, “inconvenient, improbable or irrational” consequence that there could be “a chain of internal review applications which is potentially infinite until there is a decision in the applicant’s favour”. I do not accept that that is a consequence of the interpretation I have adopted. There would be no right of further review if, at some point in the consideration of a compliance notice and its sequelae, the Secretary should simply confirm the most recent decision under review, relying upon s 191(7)(a). Although it is not necessary to decide this for the purpose of the present case, I consider that confirmation under s 191(7)(a) would include a case where the compliance notice under internal review was upheld with no adjustment other than deletions. The circumstances of the present case are that on 19 August there was issued a compliance notice that was for all practical purposes new. No inconvenience or absurdity flows from a construction of the Law that permits the plaintiff to apply for a first internal review of that new notice.

44. Thirdly, the defendant submits that subs (3) of s 191 cannot be reconciled with the interpretation that I have adopted. Subsection (3) is as follows:

(3)   The person who conducts the review for the Regulatory Authority must not be a person who was involved in the assessment or investigation of the person or service to whom or which the decision relates.

45. I see no difficulty flowing from that subsection. In the present case, the “assessment or investigation of the person or service to whom or which” the decision of 19 August relates has “involved” the authorised inspectors whose investigation resulted in the 2 June notice as well as the first delegate and the second delegate. If the plaintiff should seek internal review of the 19 August decision, then subs (3) would preclude any of those people from conducting the review.

46. Fourthly, the defendant relies upon the use of the definite article in s 191 where it refers to “the review”. It is submitted that this indicates there cannot be more than one internal review of any decision to issue a compliance notice. That submission does not conflict with the interpretation that I have indicated above. What I take to be the correct interpretation does not involve multiple internal reviews of any decision, rather it recognises the plaintiff’s right to one internal review of the exercise of the s 177 power on 2 June and one internal review of the subsequent, distinct exercise of that power on 19 August.

47. The defendant also disputes the interpretation that I have adopted on the basis that it is inconsistent with what is submitted to be “a coherent and cascading route to internal and external review” provided for in Divs 1 and 2 of Pt 8. It is submitted that this overall scheme provides that “the affected person will ordinarily have one opportunity to put their case to the defendant (whether through internal review or in response to a show cause notice) and will then have a right of external review”, subject to “the specific carve in s 192(a)” by which external review is excluded in relation to a compliance direction or compliance notice. I do not consider that this alleged overall intent of the Law’s scheme of review is sufficiently clear to displace the interpretation that I have adopted. The interpretation outlined above flows from and accords with the plain text of the Law, on a straightforward reading.

Utility of the proceedings

48. An assessment of the utility of the proceedings has a bearing upon the incidence of costs. Before filing its summons the plaintiff identified to the Secretary, in detailed and considered submissions, its reasons for contesting the steps required to be undertaken pursuant to the 19 August notice. So far as the alleged breaches of s 175 were concerned (the question of having hard copy staff records at each centre), the plaintiff’s objections were along the lines referred to at [34] above. With respect to the steps directed to remedying alleged s 167 breaches, namely, that the plaintiff:

undertake a thorough review of asthma action plans and other medical management plans and ensure that they are specifically tailored for the education and care service environment,

on 1 September 2022 the plaintiff’s Executive Director sent an email to the second delegate explaining the impracticality and unreasonableness of this requirement.

49. The Executive Director’s email included the following (emphasis added):

Broader care sector issue

The Trustees have sought direction from the Department on accepted practice for asthma action plans. The Hub Coordinator advised that:

-   parents should be contacted to address any nuance in action plans and authorisations to administer medication, and

-   this is an issue that affects the wider care sector as it is not general practice for service providers to require parents to provide service specific asthma action plans.

The absence of service specific asthma plans across St Nicholas and the broader care sector is evidence that the Department's requirement is outside of accepted industry practice, medical advice, and community standards. Notably, there is no guide issued by the Department that establishes a service specific action plan as the industry compliance requirement.

The Trustees remain concerned that a latent and unintended consequence of the Department's 19 August 2022 decision is that parents will be encouraged not to disclose their child's medical condition to avoid the onerous monetary and time cost of compliance.

Expert opinion and shared service approach

Whilst we appreciate the time that has been invested in researching the various medications recorded in the relevant action plans the position taken in the internal review decision is not based on expert medical advice or opinion, and the Trustees consider the Department to have adopted an erroneous approach in its decision-making by drawing conclusions about medical requirements without proper qualification.

The Asthma Australia proforma plans are a “Health Practitioner” resource. General practitioners are the health practitioner responsible for the development of their patient's asthma action plan and should be allowed professional discretion in the resource they adopt, with their preferred resource respected by the Department.

Given this is an industry wide issue the Trustees recommend that it be resolved by expert medical opinion as opposed to a compliance response. The Trustees propose that a single expert be appointed, their opinion be obtained on a joint letter of instruction, there be a shared service approach on the issue and given the industry wide application costs borne by the Department.

50. In view of the short timeframe specified in the compliance notice of 19 August (five weeks), the Executive Director requested that his email be treated as an application for internal review. The response from the second delegate was a letter of 19 October 2022 extending time for compliance by about nine weeks to 30 November 2022 but asserting that no internal review is available. That position rested upon the interpretation of the legislation that has been advanced on behalf the defendant in these proceedings and that I have rejected. Pending the Court’s determination of that legal issue the plaintiff has endeavoured to implement the steps required under the 19 August notice in relation to asthma management plans. It has encountered insuperable difficulties.

51. After the plaintiff had informed the Department of some of those difficulties, on 2 February 2023 an officer sent an email saying that the Department would accept as sufficient compliance (1) written assurance that all medical management plans had been reviewed with “any inaccuracies identified” and that “action has been taken to rectify the plans”, (2) provision of a 25% sample of “rectified” asthma management plans and (3) evidence that the families concerned with the 25% sample “have provided a response”. Understandably, on 9 February 2023 the plaintiff sought an explanation of what these three requirements meant. It is not clear to me. It remains obscure after reading the Department’s further correspondence of 14 February 2023.

52. On 3 March 2023 the plaintiff reported to the Department by email that 843 children in its care were identified as requiring medical management and risk management plans. Of those, 349 were asthma sufferers. Within the group of 349, 190 had management plans that listed preventer and steroid medicines that were not held by the plaintiff at its service centres. The plaintiff had written to each of the families in the last-mentioned category, with the following results:

24 (13%) of the families had updated their management plans.

23 (12%) had not updated their plans.

100 (53%) had either refused to respond, made no response, complained, sought further clarification or withdrawn their child.

43 (23%) were awaiting a medical appointment before responding.

53. The plaintiff’s report to the Department on the above results included the following commentary:

Concerningly, 4 parents have “withdrawn” the declaration their child has asthma citing reasons such as “outgrown”. This again highlights the risk we have raised throughout this process that parents may elect not to declare that their child has asthma to avoid the onerous burden of expectation created by the Department’s direction.

We have lost 2 enrolments where we have been told formally or informally […] that a material contributing factor […] is that this is not a requirement at the other services. […]

Part of our concerns raised with you was that it is inequitable and may be reasonably believed to be a biased approach adverse to St Nicholas to place this requirement on St Nicholas when it is not a sector wide expectation.

A significant number of parents have expressed concerns around the cost and availability of accessing their GP/Specialist to request a further update to the plan and whether this accessibility issue will threaten the ability of their child/children to continue attending care.

Out of the responses received, less than 14% have been able to provide updated plans that [meet] the requirements you have outlined. We believe this to be further evidence that the Department’s current approach with the Approved Provider’s services is outside of accepted industry practice, medical advice and community standards.

54. In the email of 3 March 2023 the plaintiff went on to quote examples of responses from parents who expressed considerable frustration, as members of working families, at being asked to undertake further expensive consultations with medical practitioners to have their children’s management plans revised. A number of them complained about being asked to clarify whether they authorised the plaintiff’s staff to administer Redipred/Prednisolone and/or other medication for acute symptoms, in circumstances where they considered they had made it perfectly clear that they did not. The plaintiff was placed in the impossible position of, effectively, questioning the instructions of parents by which they limited the medications that they permitted childcare staff to dispense. That position arose directly from the second delegate’s conclusion, highlighted in the passage from the 19 August 2022 decision quoted at [30] above. I repeat it for ease of reference:

With regard to respect for parental authority, it is not a sufficiently reasonable precaution for a child's parent to indicate that the service is not required to administer certain medication in the face of an asthma action plan prepared by the child's doctor which, on a plain reading, indicates something to the contrary.

This raises the question, how can a medically unqualified provider of childcare services be expected to arbitrate between the author of an asthma management plan and the parent of the child affected, with respect to who should have authority to administer medications?

55. On 18 April 2023 an Investigator, Compliance and Investigations of the Education Department notified the plaintiff in the following terms:

I have closed this compliance action as an adequate response has been received and no further action is required from you in relation to this matter.

56. On 2 May 2023 a Senior Solicitor of the Crown Solicitor’s Office wrote to the plaintiff as follows:

I am now instructed that your client has complied with the 19 August Decision. In those circumstances could you please identify the basis on which the proceedings have any continuing utility?

57. The plaintiff’s response of 11 May 2023 included the following:

The Trustees are not relieved of the burden of compliance with the [19] August 2022 compliance notice by the Department’s decision to close the compliance action and remain uncertain about how the Department may view in any future compliance monitoring visits the 87% of plans that were unchanged at 3 March 2023 or any new plans that may be generated by medical practitioners with the same features as the plans assessed on [19] August 2022 as non-compliant by the Department. The Department have not advised the Trustees that a certain percentage of change to the asthma action/medical management plans and services will address the risk considered on 19 August 2022 or satisfy the subsequent directions for compliance and there remains a lack of guidance to the Trustees and the sector generally on expectations for compliant medical management plans which may in itself present a risk to the safety, health and well-being of children accessing care services across the sector.

The 18 April 2023 decision implies a concession by the Department of the submissions made by the Trustees in the 3 March email […] and is indicative of the real prospect that an internal review of the [19] August 2022 decision will conclude, as the Trustees have always maintained, that the compliance notice did not reflect the actual risk associated with the asthma action plans at the Trustees’ services and the requirements established for compliance are impractical, inconsistent across the care sector and outside of community, parent and medical practitioner expectations and accepted standards of practice.

58. I do not consider that the proceedings have lacked utility from the plaintiff’s point of view. The plaintiff’s unsuccessful endeavours to implement the Secretary’s requirement that asthma medical management plans should be revised has demonstrated that the requirement is incapable of being carried out and that the attempt is counter-productive to relations between the approved provider and its clients and to the provision of high-quality child care to the families affected. The inequity of inflicting these impractical burdens on one approved provider rather than adopting a sector wide standard is self-evident. The Department’s approach of having “closed this compliance action” resolved nothing. It merely manifested incoherence and indecision. By denying that the plaintiff had any legal entitlement to an internal review of the 19 August decision the Secretary in effect sought to shut down further discussion through the only means by which the plaintiff could bring the issue to a head.

59. In the circumstances described above, the plaintiff was effectively driven to file and prosecute its summons. A costs order in its favour is appropriate. It is reasonable to observe that for the Department’s outlay on enforcement activity and on these proceedings, it could probably have funded an appropriately qualified medical specialist to advise upon standardised directions to all approved operators, with due consideration for the autonomy of parents in choosing the extent to which they will authorise or require childcare staff to administer medication. The plaintiff has throughout its dealings with the Department urged that competent medical assistance should be recruited. Most recently that plea was reiterated in the highlighted passages of the email of 1 September 2022, extracted at [49] above.

58. Throughout its communications with the delgates the plaintiff has expressed willingness to co-operate in implementing the standards of the statutory regime. The plaintiff has frequently offered constructive suggestions, particularly with respect to the subject of medical management. While the plaintiff’s personnel do not profess medical expertise they have demonstrated a practical appreciation of issues concerning medication and parental consent. The Regulatory Authority appears to lag behind the provider in its corporate understanding of these matters. At the outset of the hearing of this case, in an endeavour to understand why the defendant’s compliance activity had festered into litigation, I enquired of the defendant’s counsel whether his client regarded the plaintiff as a recalcitrant, persistent offender. The answer was, “No”. The competence and bona fides of the plaintiff could not be in doubt on the material that has been tendered to the Court.

59. Yet the Department’s relationship with this provider has been one of enforcement, penalisation and legal disputation rather than guidance or support. This has led to a perception within the plaintiff’s organisation that it is being scrutinised selectively and unfairly, as expressed repeatedly by the plaintiff’s Executive Director in correspondence over the past year. The sense of being harassed has been imparted to the plaintiff’s childcare staff at the centres. In the plaintiff’s application for review dated 16 June 2022 the Executive Director was prompted to write the following:

The Trustees also hold concern for the approach of some authorised officers at the time of inspection who may not be acting to be conducive to exploring compliance, but rather creating anxiety in workers, on some occasions resulting in staff reporting they felt unable to find the words to appropriately answer questions.

62. Each child care worker or early childhood educator would be managing a number of young children, trying to organise activities for them and to manage their behaviour. Performance of these duties cannot have been made any easier by the attendance of Departmental inspectors demanding to see stocks of Redipred/Prednisolone that the inspectors erroneously thought should be present, requiring production of hard copy records, refusing to acknowledge a staff member’s qualification certificate on a mobile phone (contrary to almost universal modern commercial practice) and finding minor faults.

63. The Department’s generation of anxiety by its approach to administering the Law has extended to a number of families. They are economically dependent upon the availability of the services offered by the plaintiff. The direction of 19 August for review of health management plans has caused concern amongst parents about their capacity to attend to this and about the eligibility of their children for care in the meantime. The direction has subsequently been abandoned by the Investigator’s email of 23 April 2023, but only after imposing additional medical consultations upon families who can ill afford the expense.

64. If, on the other side of the account, the Secretary’s compliance campaign with respect to the plaintiff has delivered benefits to the public, to approved providers, to parents or to children, those benefits have not come to light in the evidence tendered in these proceedings. The plaintiff’s summons has been at least useful, perhaps necessary, as a means of requiring the Secretary to take responsibility for settling the disruption and uncertainty that have been caused by the 19 August decision.

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Decision last updated: 07 July 2023