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Jattan v Chief Executive, Queensland Health

 

[2010] QSC 92

 

 

SUPREME COURT OF QUEENSLAND

 

PARTIES:

FILE NO/S:

Trial Division

PROCEEDING:

Originating Application

ORIGINATING COURT:

DELIVERED ON:

31 March 2010

DELIVERED AT:

Brisbane 

HEARING DATE:

25 March 2010

JUDGE: 

Chief Justice

ORDERS:

1.Declare that the respondent was not, and is not, entitled to rely on evidence given by the applicant at an examination before an examiner of the Australian Crime Commission on 18 October 2007 as referred to in the respondent’s Notice of Proposed Action – Section 24 issued under the Health (Drugs and Poisons) Regulation 1996 dated 31 January 2010, in making any determination in respect of that notice, because that evidence was not and is not admissible in the proceeding commenced or constituted by the issue of that notice;

2.Declare that the notice dated 31 January 2010 was not validly issued under s 24(1) of the Health (Drugs and Poisons) Regulation 1996;

3.Order that the respondent pay the applicant’s costs of and incidental to this application, to be assessed on the standard basis;

4.Direct that pages 46 to 58 of the exhibit to the affidavit of Melanie Michelle Morris sworn 10 March 2010 be detached and placed in a sealed envelope marked: “not to be opened except on the order of a Judge”.

CATCHWORDS:

STATUTES – ACTS OF PARLIAMENT – PARTICULAR WORDS AND PHRASES – GENERALLY – where Applicant is a registered pharmacist – where Applicant gave evidence under compulsion of summons pursuant to s 28 Australian Crime Commission Act 2002 (Cth) before an examiner of the Australian Crime Commission – where Applicant was issued with a Notice of Proposed Action- Section 24 under the Health (Drugs and Poisons) Regulation 1996 by the Delegate of the Chief Executive of Queensland Health – where the Notice of Proposed Action- Section 24 could result in cancellation of the Applicant’s endorsements to obtain, dispense, sell, possess or otherwise deal with all and any drugs and poisons falling within the descriptions of controlled drugs, restricted drugs and Schedule 2, 3 and 7 poisons – where the Notice of Proposed Action- Section 24 included evidence given by the Applicant at the hearing before an examiner of the Australian Crime Commission – where s 30(5) Australian Crime Commission Act 2002 (Cth) provides that answers given at Australian Crime Commission Examinations are not admissible in evidence against the answerer in “a proceeding for the imposition of a penalty” – whether the Notice of Proposed Action- Section 24 contravened s 30(5) Australian Crime Commission Act 2002 (Cth) because it amounted to “a proceeding for the imposition of a penalty” – whether Respondent was entitled to rely on evidence provided by the Applicant at the Australian Crime Commission Examination – whether Notice of Proposed Action- Section 24 was validly issued

Australian Crime Commission Act 2002 (Cth), s 28, s 30(4), s 30(5)

Health (Drugs and Poisons) Regulation 1996 (Qld), s 15, s 23, s 24, s 64, s 171, s 193(1)-(4), s 199(1)-(4), s 257, s 285A

Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 20(2)

Adamson v Queensland Law Society Inc [1990] 1 Qd R 498, cited

Clyne v New South Wales Bar Association (1960) 104 CLR 186, cited

R v NG [2006] QCA 218, cited

Rich v Australian Securities and Investments Commission (2004) 220 CLR 129, applied

COUNSEL:

P J Davis SC, with S McLeod, for the applicant

R P Devlin SC for the respondent

SOLICITORS:

Gilshenan and Luton Legal Practice for the applicant

DLA Phillips Fox for the respondent

Introduction

[1] CHIEF JUSTICE: The applicant is a registered pharmacist.  On 18 October 2007, he gave evidence, under the compulsion of a summons issued under s 28 of the Australian Crime Commission Act 2002 (Cth), before an examiner of the Australian Crime Commission (“ACC”). 

[2] Queensland Health is responsible for regulating drugs and poisons, including taking action to protect the public by restricting the authority of pharmacists to dispense them.  By notice dated 31 January 2010, the Delegate of the Chief Executive of Queensland Health gave notice to the applicant that she proposed cancelling his relevant authority (called an “endorsement”), and calling upon the applicant to show cause “why the proposed action, namely, cancellation of your endorsements to obtain, dispense, sell, possess or otherwise deal with all and any drugs and poisons falling within the descriptions of controlled drugs, restricted drugs and Schedule 2, 3 and 7 poisons, should not be taken”. 

[3] In that document, the Delegate comprehensively set out the evidence upon which she relied, alleging wrongdoing by the applicant, and it included evidence given by the applicant at the hearing before the ACC examiner. 

[4] These are the “grounds” for the proposed cancellation, as set out in the notice:

Ground

Description of ground

Ground 1

In about February 2007, you were convicted of breaching section 285A of the Regulation for failing to record a sale of pseudoephedrine (PSE).

Ground 2

Contrary to the requirements in section 193(1) of the Regulation, on various dates you dispensed restricted drugs, namely steroids, without a valid prescription.

Further, or in the alternative, you dispensed steroids in a volume and at a frequency beyond the extent necessary to practise pharmacy and outside the terms of your as of right endorsement as a pharmacist.

Further, or in the alternative, you failed to maintain a record of the dispensing of steroids as required by sections 199(1)-(4) of the Regulation.

Ground 3

Contrary to the requirements in section 193(2) and 193(4) of the Regulation, you dispensed restricted drugs without a valid prescription.

Ground 4

In breach of section 217(4) of the Regulation, you wrote on prescriptions.

Ground 5

You deleted entries in the dispensing data of the Broadbeach Chemist contrary to section 199(5) of the Regulation.

Ground 6

You made false or misleading entries in the records of the Broadbeach Chemist contrary to section 216 of the Regulation.

Ground 7

You knew or ought reasonably to have known that a person who does not and did not hold endorsement pursuant to the Regulation dispensed restricted drugs at the Broadbeach Chemist contrary to section 171 of the Regulation.

Ground 8

You failed to maintain records relating to the sale of products containing PSE as required by section 285A of the Regulation.

Ground 9

Pursuant to section 23(b) of the Regulation, you are not a suitable person.

Ground 10

You dispensed steroids to customers including…at a volume and frequency beyond the terms of his endorsement as a pharmacist.

Ground 11

You dispensed restricted drugs to certain patients without a prescription.

[5] The Regulation referred to in those grounds is the Health (Drugs and Poisons) Regulation 1996 (Qld).

[6] After setting out those “grounds”, the notice has a “facts and circumstances” section, in which the Delegate sets out the evidentiary foundation for each ground.  The Delegate relied substantially on the evidence given on oath by the applicant before the ACC examiner.  She contrasted that evidence with the position previously put before her (by way of unsworn submission) by the applicant.  She indicated an understandable preference for the sworn evidence.  Reliance on the ACC evidence was apparently central to the Delegate’s approach.

[7] Section 30(5) of the Australian Crime Commission Act 2002 provides that answers given at such a hearing are not admissible in evidence against the answerer in “a proceeding for the imposition of a penalty”. 

[8] The issue before me is whether the evidence on which the Delegate relied, in that way, was inadmissible, and if so, invalidated the show-cause notice potentially leading to the loss of his professional career.

[9] The question before me is not to do with the merit of his situation, legal or moral, but is purely one of statutory interpretation, that is, whether he faced “a proceeding for the imposition of a penalty”.

Relief sought

[10] The applicant seeks the following declarations:

“1.A declaration that the respondent is not entitled to use evidence the applicant gave during an Australian Crime Commission hearing on 18 October 2007 referred to in a Notice of Proposed Action – Section 24, issued under the Health (Drugs and Poisons) Regulation 1996 (Qld), dated 31 January 2010.

2.A declaration, that by using the evidence referred to above, the respondent breached s 30(5)(b) of the Australian Crime Commission Act 2002 (Cth).

3.A declaration that the said notice is unlawful.”

The statutory provisions

[11] Section 30(4) and (5) of the Australian Crime Commission Act 2002 provides:

Use immunity available in some cases if self-incrimination claimed

(4) Subsection (5) limits the use that can be made of any answers given at an examination before an examiner, or documents or things produced at an examination before an examiner.  That subsection only applies if:

(a)a person appearing as a witness at an examination before an examiner:

(i)answers a question that he or she is required to answer by the examiner; or

(ii)produces a document or thing that he or she was required to produce by a summons under this Act served on him or her as prescribed; and

(b)in the case of the production of a document that is, or forms part of, a record of an existing or past business – the document sets out details of earnings received by the person in respect of his or her employment and does not set out any other information; and

(c)before answering the question or producing the document or thing, the person claims that the answer, or the production of the document or thing, might tend to incriminate the person or make the person liable to a penalty.

(5)The answer, or the document or thing, is not admissible in evidence against the person in:

(a)a criminal proceeding; or

(b)a proceeding for the imposition of a penalty; other than:

(c)confiscation proceedings; or

(d)a proceeding in respect of:

(i)in the case of an answer – the falsity of the answer; or

(ii)in the case of the production of a document – the falsity of any statement contained in the document.”

The parties’ principal contentions

[12] Mr Davis SC, who appeared with Mr McLeod for the applicant, submitted that the notice of 31 January 2010 evidenced contravention of the limitation of s 30(5)(b), because it amounted to a “proceeding for the imposition of a penalty”, namely, the cancellation of the applicant’s endorsements, and involved reliance, therefore, on inadmissible evidence.  He relied substantially on the reasoning of the High Court in Rich and Anor v Australian Securities and Investments Commission (2004) 220 CLR 129 paras 28-37.

[13] On the other hand, Mr Devlin SC, appearing for the respondent, submitted that if the notice involved a “proceeding”, that proceeding was not for the imposition of a penalty, but was, at least in a dominant sense, directed towards protecting the public from the applicant.  He referred to many decisions of the High Court and other courts drawing that distinction, such as Clyne v New South Wales Bar Association (1960) 104 CLR 186 at 201-2, Adamson v Queensland Law Society Inc [1990] 1 Qd R 498 at 504 and R v NG [2006] QCA 218 at 40-48.

Does the issue of the notice of 31 January 2010 establish the existence of a “proceeding”?

[14] This notice did not come out of the blue.  It was preceded by a similar notice on 26 April 2009, to which the applicant responded on 23 June 2009.  Then on 16 September 2009, the respondent notified the addition of further grounds of complaint, to which the applicant responded on 15 October 2009.  That led to the respondent’s decision on 14 December 2009 to suspend the applicant’s endorsements for six months.  It was the respondent’s further notice of 31 January 2010 seeking cancellation, in issue here, which for the first time relied on evidence given by the applicant before the ACC examiner on 18 October 2007.

[15] “Endorsements” (which are “authorities” or “approvals” – see the dictionary in appendix 9 to the Health (Drugs and Poisons) Regulation 1996) may only be granted to a “suitable person” (s 15).  If the grantee of an endorsement ceases to be suitable, the endorsement may be cancelled or suspended (s 23).  Section 24 sets out the procedure to be followed to determine whether an endorsement should be cancelled or suspended.  A decision to suspend or cancel an endorsement is subject to review by the newly-established Queensland Civil and Administrative Tribunal (s 33(2)(c)).  The Tribunal is in that case obliged to “hear and decide a review…by way of a fresh hearing on the merits” (s 20(2) Queensland Civil and Administrative Tribunal Act 2009 (Qld)).

[16] Mr Devlin acknowledged that the term “proceeding”, which is legislatively undefined, is of broad ambit, but submitted – without supporting argument – that “it may not include administrative action taken by Queensland Health with respect to a person’s endorsement”.  On the other hand, as I put to Mr Davis, it would be somewhat odd were the process of review a “proceeding”, which it clearly is, whereas the precedent steps did not amount to a proceeding provoking the review.

[17] Here the “precedent steps” were the issue, under statutory authority, of a show-cause notice, as to why the applicant’s endorsements should not be cancelled, setting out the prima facie justification for that course; any response by the applicant; and any resultant determination by the Delegate.

[18] The whole process is a “proceeding” begun by the issue of the show-cause notice.  Further, the issue of that notice itself should be characterized as a “proceeding”.

[19] The term “proceeding” is relevantly defined by the Macquarie Dictionary (3rd ed) as “a particular action or course of action”; and in the same way by the Shorter Oxford English Dictionary, together with “a piece of conduct or behaviour; a transaction”.  Those definitions are broad enough to embrace this show-cause notice.

Was it a proceeding “for the imposition of a penalty”?

[20] Mr Devlin submitted, perfectly reasonably, that community protection lay at the heart of the process set up by the Health (Drugs and Poisons) Regulation 1996. 

[21] The instant notice foreshadowed a proposed cancellation “by operation of ss 64, 171 and 257 of the Regulation”. 

[22] Section 64 provides that “to the extent necessary to practise pharmacy, a pharmacist is authorized to” obtain, dispense and sell controlled drugs etc.  Section 171(1) says that in the same circumstances, a pharmacist is authorized to obtain, dispense and sell restricted drugs etc.  Section 257 provides similarly that a pharmacist will be authorized to dispense or sell an S2, S3 or S7 poison”. 

[23] It is obviously of prime importance to the community that only trustworthy persons have such access to drugs.

[24] Mr Devlin submitted that in Rich, the High Court did not “put to death” the relevance in this context of the distinction between securing community protection and imposing a penalty, and that if ever there were a case for protection, this was it.  Again, I would not quarrel with that position.  But that does not exclude the possibility that cancellation of endorsements would operate in a penal or punitive way upon the applicant.

[25] I was referred to many cases, but it is sufficient to focus on Rich, because the High Court’s approach in that case definitively resolves this one.

[26] In Rich the Australian Securities and Investments Commission sought orders against company directors, including disqualification from the management of a corporation, and those directors had been ordered to make discovery of documents.  The High Court held that the privilege against exposure to penalty qualified their obligation of disclosure.

[27] The court was pressed with the distinction between protective and penal proceedings, but disavowed that approach, preferring a focus “upon the nature of the orders that are sought”.  An order disqualifying a director from managing a corporation was, it considered, penal.  It was not to the point that the existence of such an order would also protect the community.  Further, upholding in that corporations context a privilege against exposure to penalty did not reflect any peculiarity of the corporations law. 

[28] Those points emerge from paras 28-37 of the joint judgment of Gleeson CJ, Gummow, Hayne, Callinan and Heydon JJ, which should be extracted in full, because they constitute the comprehensive justification for my conclusion.  The italicized passages reflect my added emphasis.

“28.In several cases it has been held that exposure to loss of office is exposure to a penalty or forfeiture. And in Police Service Board v Morris it was at least assumed that exposure to dismissal from a police force was a form of penalty. By contrast, however, orders for compensation have been held not to be penalties.

29.That stream of authority would suggest that for the Commission to seek an order disqualifying a person from acting in the management of a corporation on the ground that the person has contravened the law is to seek a penalty or forfeiture. The order is sought by a regulatory authority; its grant would be founded on demonstration of a contravention of the law; it is an order which leads to the vacation of existing offices in a corporation and imposition of a continuing disability for the duration of the order. What is it that would deny that conclusion?

30.The decisions of the primary judge and the majority in the Court of Appeal proceeded from the premise that a distinction between "punitive" and "protective" proceedings was possible and useful and that, when applied to the present proceedings, it led to the conclusion that the present proceedings have a protective not punitive purpose. There are several reasons to reject that reasoning.

31.First, adopting such a classification diverts attention from the relevant question which is whether the privilege against exposure to penalties applies. That requires consideration of the kinds of relief which are sought in the proceeding. Neither the purpose which the applicant may have in seeking relief of that kind, nor the effects on persons other than the appellants of obtaining that relief, bears upon whether the proceedings expose the appellants to penalties. Yet an attempt to classify the proceedings as "punitive" or "protective" appears to require consideration of only those purposes or effects. Thus it is said that to disqualify a person from managing a corporation protects shareholders or creditors of the corporations in which the person concerned would otherwise have held office. If a disqualification order has that effect, and it may well, that is not relevant to whether exposing the person concerned to the possibility of such an order being made is to expose that person to a penalty.

32.Secondly, and more fundamentally, the supposed distinction between "punitive" and "protective" proceedings or orders suffers the same difficulties as attempting to classify all proceedings as either civil or criminal. At best, the distinction between "punitive" and "protective" is elusive. That point is readily illustrated when it is recalled that, as McColl JA pointed out, account must be taken in sentencing a criminal offender of the need to protect society, deter both the offender and others, to exact retribution and to promote reform.

33.Thirdly, and no less fundamentally, not only does the supposed distinction between punitive and protective procedures find no sure footing in the course of decisions concerning the application of the privilege against exposure to penalties, it is inconsistent with the principles revealed by those authorities.

34.Both the primary judge and the majority in the Court of Appeal pointed to cases in which it has been said that the purpose of disqualification orders made against directors or other officers of a company is to protect the public rather than to punish. Subject to one exception, Australian Securities Commission v Kippe, those cases were all concerned, directly or indirectly, with setting an appropriate period of disqualification. It by no means follows, however, that this leads to the conclusion that the privilege against exposure to penalties has some narrower or different application in connection with proceedings against officers of corporations from the application it would ordinarily have. The relevant question is not, as the majority in the Court of Appeal appears to have understood it, whether there is some special rule of corporations law. (The early cases about discovery in relation to stock jobbing would tend to deny that there is such a special rule.) The question is how should the general principles of the privileges against exposure to penalties and forfeiture find application in the particular circumstances of these proceedings. That inquiry is not assisted by examining why the orders sought in the proceedings might be made or what purposes might be achieved by their making. Rather, attention must be focused upon the nature of the orders that are sought.

35.That it may be possible to characterise proceedings as having a purpose of protecting the public is not determinative. And to begin the inquiry from an a priori classification of proceedings as either protective or penal invites error. It invites error primarily because the classification adopted assumes mutual exclusivity of the categories chosen when they are not, and because the classification is itself unstable. To assume mutual exclusivity of the categories is to fall into the same kind of error as was identified in the constitutional context in Actors and Announcers Equity Association v Fontana Films Pty Ltd. Just as a law may bear several characters, a proceeding may seek relief which, if granted, would protect the public but would also penalise the person against whom it is granted. That a proceeding may bear several characters does not deny that it bears each of those characters. Moreover, as Hayne J emphasised in Chief Executive Officer of Customs v Labrador Liquor Wholesale Pty Ltd, those who seek the "essential character" of statutory provisions do not proffer explanations of that process of distillation.

36.It was not suggested, and could not seriously be suggested, that directors, alternate directors and company secretaries do not hold offices to which the privileges against forfeiture and penalties may apply. Rather, the contention of the Commission was that discussed above, namely that the relevant proceedings were protective rather than penal.

37.If a disqualification order is made, the person against whom the order is made ceases to be a director, alternate director, or a secretary of a company, unless given permission under s 206F or s 206G of the 2001 Act to manage the corporation concerned. The order for disqualification thus causes the person against whom it is made to forfeit any office then held in a corporation and forbids that person from holding office in a corporation for the duration of the disqualification order. Those consequences, whether taken separately or in combination, when inflicted on account of a defendant's wrongdoing, are penalties. That the penalty is not exacted in the form of a money payment does not deny that conclusion. As the authorities referred to earlier in these reasons reveal, equity's concern with penalties was never confined to pecuniary penalties. If exposure to loss of office or exposure to dismissal from a police force is exposure to penalty, exposure to a disqualification order is exposure to a penalty.

[29] Mr Devlin particularly relied on these concluding observations in para 34:

“The question is how should the general principles of the privileges against exposure to penalties and forfeiture find application in the particular circumstances of these proceedings.  That inquiry is not assisted by examining why the orders sought in the proceedings might be made or what purposes might be achieved by their making.  Rather, attention must be focused upon the nature of the orders that are sought.”

He submitted that those orders were, in this case, protective in character.

[30] While it was said at the hearing during the oral interchange that the judgment required of me was finely balanced, I consider on reflection that an order seeking cancellation of the applicant’s right to obtain, dispense and sell controlled and restricted drugs and poisons, central to any practice as a pharmacist, should clearly be regarded as penal in character (meaning, because of its consequences for the pharmacist), notwithstanding that a desire to protect the community may have been the substantial motivation driving the respondent.  As said in Rich in para 35, “a proceeding may seek relief which, if granted, would protect the public but would also penalise the person against whom it is granted.  That a proceeding may bear several characters does not deny that it bears each of those characters.”  Focusing on the nature of the order sought, as Rich admonishes me to do, the conclusion is compelling that this instant proceeding is a proceeding “for the imposition of a penalty” within the meaning of s 30(5)(b) of the Australian Crime Commission Act 2002.  The effective denial of the right to practise as a pharmacist consequent upon wrongdoing must be seen as penal:  the comparable order sought in Rich also bore that character.

[31] The evidence given at the examination was inadmissible in the show-cause proceeding.  Because of its substantial reliance on inadmissible material, the notice dated 31 January 2010 was invalid.

Other matters

[32] Finally, I confirm two other matters:  first, that I was asked to proceed on the basis (albeit there was absence of sworn evidence) that the applicant made the statutorily required claim as to incrimination (cf. s 30(4)(c)); and second, that there was no suggestion that if the notice brought in inadmissible material, it was nevertheless, by some means or other, able to be rescued from invalidity.

Orders

[33] There will therefore be declarations:

1. that the respondent was not, and is not, entitled to rely on evidence given by the applicant at an examination before an examiner of the Australian Crime Commission on 18 October 2007 as referred to in the respondent’s Notice of Proposed Action – Section 24 issued under the Health (Drugs and Poisons) Regulation 1996 dated 31 January 2010, in making any determination in respect of that notice, because that evidence was not and is not admissible in the proceeding commenced or constituted by the issue of that notice;

2. that the notice dated 31 January 2010 was not validly issued under s 24(1) of the Health (Drugs and Poisons) Regulation 1996.

[34] There will also be an order that the respondent pay the applicant’s costs of and incidental to this application, to be assessed on the standard basis.  (There was no suggestion that costs should not in such a case follow the event, or claim that they be assessed on an indemnity basis.)

[35] Because further disclosure of the content of the notice might jeopardize police investigations or prosecutions, I accede to Mr Devlin’s application, and make a further direction that pages 46 to 58 of the exhibit to the affidavit of Melanie Michelle Morris sworn 10 March 2010 be detached and placed in a sealed envelope marked:  “not to be opened except on the order of a Judge”.

Close

Editorial Notes

  • Published Case Name:

    Jattan v Chief Executive, Queensland Health

  • Shortened Case Name:

    Jattan v Chief Executive, Queensland Health

  • MNC:

    [2010] QSC 92

  • Court:

    QSC

  • Judge(s):

    de Jersey CJ

  • Date:

    31 Mar 2010

  • White Star Case:

    Yes

Litigation History

Event Citation or File Date Notes
Primary Judgment [2010] QSC 92 31 Mar 2010 -
Appeal Determined (QCA) [2010] QCA 359 17 Dec 2010 -

Appeal Status

{solid} Appeal Determined (QCA)