FEDERAL COURT OF AUSTRALIA

Angelos v Minister for Health [2014] FCA 706

THE COURT ORDERS THAT:

1.    The decision of the Minister of 26 June 2013 under s 90A(2) of the National Health Act 1953 (Cth) not to approve the applicant to supply pharmaceutical benefits at 192-198 Wakefield Street, Adelaide is quashed.

2.    The applicant’s request of 25 January 2013, as supplemented by the letter from the applicant’s solicitor of 16 May 2013, for the Minister for Health to exercise the power under s 90A(2) of the National Health Act 1953 (Cth) in respect of the premises at 192-198 Wakefield Street, Adelaide, is referred back to the Minister for Health for further consideration.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

1        The applicant seeks judicial review pursuant to the Administrative Decisions (Judicial Review) Act 1977 (Cth) (the ADJR Act) of a decision of the Minister for Health made on 26 June 2013 rejecting his request for approval of premises for a pharmacy.

Background

2        By s 89 of the National Health Act 1953 (Cth) (the NH Act), a person is not entitled to receive a pharmaceutical benefit (PBS benefit) unless it is supplied, amongst other things, by an approved pharmacist at or from approved premises. A PBS benefit is a form of prescribed drug. The NH Act provides a scheme by which a pharmacist may obtain approval to supply PBS benefits at particular premises.

3        The pharmacist may, in the first instance, apply to the Secretary of the Department of Health for approval (s 90(1)). Subject to some exceptions which are not presently relevant, the Secretary is obliged by subs (3A) to refer the application to the Australian Community Pharmacy Authority established under s 99J (the Authority), and may grant the approval only if the Authority recommends the grant (subs (3B)).

4        In reaching its recommendation, the Authority must comply with the Rules determined by the Minister under s 99L. Those Rules are contained in the National Health (Australian Community Pharmacy Authority Rules) Determination 2011. The Rules require the Authority to recommend approval of an application if the circumstances specified in s 10 of the Rules are met and to recommend that an application not be approved if a prescribed matter relating to the premises in question is not satisfied (s 11).

5        However, the rejection by the Secretary of an application may not be the end of the matter. Sections 90A and 90B of the NH Act permit a disappointed applicant in some circumstances to request the Minister to make a decision approving the supply of PBS benefits at particular premises and the Minister may, in defined circumstances, make a decision to that effect in substitution for that of the Secretary.

6        When a pharmacist makes a request to the Minister under s 90B, the Minister must, within three months after receiving the request, personally decide whether to consider the request. If the Minister does not make a decision within this period, he or she is taken to have decided not to consider the request (s 90B(4)). I will refer to this as the first stage.

7        If the Minister does decide to consider the pharmacist’s request, the Minister must, within three months of that decision, personally decide whether to exercise the power under s 90A(2) to make a decision in substitution for that of the Secretary. Again, if the Minister does not make a decision within the three month period, he or she is taken to have decided not to exercise that power (s 90B(5)). This is the second stage.

The application in respect of the Midnight Pharmacy

8        The applicant is a pharmacist. He has conducted the pharmacy known as “Midnight Pharmacy” at approved premises at 13 West Terrace, Adelaide. The Midnight Pharmacy had been located at those premises for approximately 10 years. Before that, it had been conducted at other premises on West Terrace.

9        The applicant leased the West Terrace premises. That lease was to expire in April 2013 and, on that expiry, the applicant wished to relocate the pharmacy. He identified premises at 192-198 Wakefield Street as suitable for his purpose.

10        On 31 October 2012, the applicant lodged a request with the Secretary seeking approval in respect of the Wakefield Street premises. The Secretary referred that application to the Authority for a recommendation. The Authority recommended against the approval, as it was obliged to do, because the Wakefield Street premises were approximately 1.9 kilometres away from the West Terrace premises by straight line and, therefore, not compliant with rule 124 (in Sch 1, Pt 1 of the Rules). That rule permits relocation only if the new premises are no more than one kilometre, in a straight line, from the existing pharmacy. The Secretary’s delegate then refused the applicant’s request for approval.

11        On 25 January 2013, the applicant (by his solicitor) requested the Minister (the Hon Tanya Plibersek MP) to make a decision in substitution for that of the Secretary’s delegate.

12        Both the West Terrace and Wakefield Street premises are within the Adelaide Central Business District (CBD). West Terrace is one of the four terraces forming the border of the City of Adelaide and separating it from the surrounding parklands. The applicant emphasised this feature because the parklands to the west, north and south of the West Terrace premises limited the area within a one kilometre radius within which available alternative premises could be found. He contended that this was an “unintended consequence” of the one kilometre rule which warranted particular consideration in his case. The term “unintended consequence” appears to be derived from the Guidelines for Ministerial Discretion (the Ministerial Guidelines) (to which Jagot J referred in Hanna v Minister for Health [2013] FCA 303 at [35]) which identify matters to which the Minister may have regard when applying s 90A(2).

13        Another feature of the Midnight Pharmacy is that the applicant keeps it open until midnight, seven days each week. It is one of only two pharmacies in greater metropolitan Adelaide which remain open until midnight. The other pharmacy is at Glenelg, approximately 10 kilometres to the south-west of the CBD. The Midnight Pharmacy is accordingly the only pharmacy in the CBD which is open to midnight.

14        The applicant relied heavily on this feature in his request. He noted that customers of the Midnight Pharmacy came from a number of places in the greater metropolitan area and not just from places in close proximity to West Terrace.

15        The Minister received a recommendation from the Department that, under s 90B(4), she decide not to consider the applicant’s request. The Minister did not accept that recommendation and, on 8 April 2013, resolved to consider the applicant’s request.

16        By s 90B(5), the Minister was then required within three months to decide personally whether to exercise the power under s 90A(2) in respect of the Secretary’s decision. As previously noted, if the Minister did not make a decision within that three month period, she would be taken to have decided not to exercise the power under s 90A(2) in respect of the Secretary’s decision.

17        The Minister requested the Department to obtain further information. Mr Bessell, an Assistant Secretary in the Department, wrote to the applicant’s solicitors on 2 May 2013 inviting responses to a number of questions and also inviting the applicant to provide “any relevant updated or additional information in support of the request at this time”. The solicitors responded by letter dated 16 May 2013.

18        The Minister made a decision on 26 June 2013 which was adverse to the applicant.

19        Although the applicant did not have an approval under s 90 of the NH Act in respect of the Wakefield Street premises, he did commence trading at those premises on 15 April 2013, and has traded there ever since. By letter dated 16 May 2013, the applicant’s solicitors informed the Department:

Mr Angelos has negotiated a lease for the new premises for the business which … has security of tenure for 20 years if needed.

…

Mr Angelos has negotiated a monthly tenancy for a lesser area at the existing West Terrace premises to allow the legal requirements for the pharmacy to be fulfilled for the supply of PBS medicines.

…

Mr Angelos took possession of the proposed premises upon commencement of the lease term and undertook a significant fit out of the premises. On Monday, 15 April 2013, trading commenced at the new premises. PBS medicines are supplied to customers at the new premises but recorded at the previous premises in the same way as an offsite delivery in filling scripts.

20        These circumstances were known to the Minister at the time she made her decision but do not appear to have played any part in that decision. However, they do give rise to an issue in these proceedings to which I will return later.

21        The applicant seeks relief under the ADJR Act in respect of the Minister’s decision of 26 June 2013 on a number of grounds. He alleges a breach by the Minister of the rules of natural justice in three respects; a failure by the Minister to have regard to five relevant considerations (broken down into nine sub-considerations); and that the Minister’s decision is affected by four errors of law. Several of the matters upon which the applicant relied for these grounds were common to all grounds.

22        The proposition that a ministerial decision of the present kind could be affected by so many errors is implausible. The fact that the applicant has chosen to advance so many alleged errors could be taken as an indication that he does not have confidence in any of them: see the observation of McHugh J in Tame v New South Wales [2002] HCA 35 at [70]; (2002) 211 CLR 317 at 345.

The statutory provisions

23        Section 90A of the NH Act, which contains the power of the Minister to substitute a decision for that of the Secretary, provides (relevantly):

90A    Minister may substitute decision approving pharmacist

(1)    This section applies in relation to a decision of the Secretary under section 90 rejecting an application by a pharmacist for approval to supply pharmaceutical benefits at particular premises, if:

(a)    the application was made on or after 1 July 2006; and

(b)    the decision was made on the basis that the application did not comply with the requirements of the relevant rules determined by the Minister under section 99L.

(2)    The Minister may substitute for the Secretary’s decision a decision approving the pharmacist for the purpose of supplying pharmaceutical benefits at the particular premises if the Minister is satisfied that:

(a)    the Secretary’s decision will result in a community being left without reasonable access to pharmaceutical benefits supplied by an approved pharmacist; and

(b)    it is in the public interest to approve the pharmacist.

(3)    For the purposes of subsection (2):

community means a group of people that, in the opinion of the Minister, constitutes a community.

reasonable access, in relation to pharmaceutical benefits supplied by an approved pharmacist, means access that, in the opinion of the Minister, is reasonable.

(4)    The power under subsection (2) may only be exercised:

(a)    on request by the pharmacist made under section 90B; and

(b)    by the Minister personally.

(5)    Subject to subsection 90B(5), the Minister does not have a duty to consider whether to exercise the power under subsection (2) in respect of the Secretary’s decision.

…

As can be seen, subs (2) provides that a Minister must be satisfied about two matters before being able to substitute the Minister’s own decision for that of the Secretary, namely, that the Secretary’s refusal of approval will result in “a community” being left without “reasonable access” to pharmaceutical benefits supplied by an approved pharmacist, and that it is in the public interest to approve the pharmacist. Subsection (4) provides that the power under subs (2) may be exercised only on a request by a pharmacist and only by the Minister.

24        Section 90B, which governs the making of the request to the Minister under s 90A, provides (relevantly):

90B    Request to Minister to approve pharmacist

(1)    If section 90A applies to a decision of the Secretary under section 90 rejecting an application by a pharmacist, the pharmacist may, in writing, request the Minister to exercise the Minister’s power under subsection 90A(2) in respect of the Secretary’s decision.

…

(4)    The Minister must, within 3 months after receiving a request under subsection (1), personally decide whether to consider the request. If the Minister has not made a decision within this period, the Minister is taken to have decided not to consider the request.

(5)    If the Minister decides to consider a request under subsection (1), the Minister must, within 3 months after making that decision, personally decide whether to exercise the power under subsection 90A(2) in respect of the Secretary’s decision. If the Minister has not made a decision within this period, the Minister is taken to have decided not to exercise the power under subsection 90A(2) in respect of the Secretary’s decision.

…

It is s 90B which, in conjunction with s 90A, provides for the two stages in the process.

25        The Minister may require an applicant to provide further information (s 90D). If a Minister does decide to substitute for a decision of the Secretary a decision approving the supply of PBS benefits at particular premises, the applicant is to be treated, for all purposes of the Act, as having been approved under s 90 of the Act in respect of those premises (s 90E).

The Minister’s reasons

26        The Minister’s statement of reasons under s 13 of the ADJR Act commenced with a chronology of the relevant events leading to the Minister’s decision.

27        The Minister then identified the material to which she had had regard in making her decision. This was a document entitled “Minute to the Minister” dated 18 June 2013 (the June Minute) and its nine attachments. The first attachment was a “Summary of Facts and Evidence” (the F and E Summary) prepared by the Department in relation to the application. The ninth attachment was an earlier “Minute to the Minister” dated 25 March 2013 (the March Minute) in relation to the first stage, namely, the decision under s 90B(4) whether to consider the applicant’s request. That earlier Minute included five attachments and had referred in part to the Ministerial Guidelines.

28        The Minister then set out 12 findings of fact. The findings which are relevant for present purposes, and the paragraphs in which they are located, can be summarised as follows:

(1)    The opening hours of the proposed premises are 7.00am to midnight Monday to Saturday, and 9.00am to midnight Sunday and public holidays ([19]);

(2)    There are 14 approved pharmacies in the Adelaide CBD, nine of which are located within a one kilometre radius of the proposed premises ([20]). Six of these are open until at least 6.00pm ([28]);

(3)    The nearest approved pharmacy, Rundle Mall Pharmacy, 151 Rundle Mall, Adelaide, is approximately 609 metres, by straight line, from the proposed premises. That pharmacy trades 7.30am to 7.30pm Monday to Friday, and 8.30am to 5.30pm Saturday and Sunday ([21]);

(4)    There are four pharmacies in greater Adelaide open until 9.00pm or 10.00pm, the same opening hours as nearby medical centres ([22]);

(5)    There are two approved pharmacies in greater Adelaide open until 10.00pm seven days a week, the same opening hours as nearby medical centres ([23]);

(6)    There is one approved pharmacy in greater Adelaide open until 10.00pm Monday to Friday, and to 9.00pm Sunday, these being similar to the opening hours of a nearby medical centre ([24]);

(7)    There are two approved pharmacies in greater Adelaide open to 9.00pm, seven days a week, these being similar to the opening hours of a nearby medical centre ([25]);

(8)    There are two approved pharmacies in greater Adelaide open to 8.00pm Monday to Friday, the same hours as nearby medical centres ([26]);

(9)    There is another pharmacy in greater Adelaide that is open seven days a week to midnight. This pharmacy is located in Glenelg, 10 km from the CBD ([27]);

(10)    The Wakefield Street Family Practice and Adelaide Health Care open until 6.00pm ([28]).

As can be seen, these findings of facts related, for the most part, to pharmacies other than the applicant’s.

29        The Minister then concluded the section of her reasons headed “Findings on material questions of fact” with the following:

[29]    I accepted the Department’s analysis in the “Minute to the Minister” that there were no unintended consequences of the application of the Pharmacy Location Rules in this particular case and the decision of the Secretary’s delegate will not result in a community being left without reasonable access to PBS medicines supplied by an approved pharmacist.

The Minister’s reasons then continued as follows:

Decision

[30]    In accordance with subsection 90B(5) of the Act, I decided not to exercise my discretionary power to approve Mr Peter Angelos (AXS 31 Pty Ltd) to supply PBS medicines at the proposed premises … under subsection 90A(2) of the Act.

Reasons for decision

[31]    I can only exercise my discretionary power if I am satisfied that both the “reasonable access” and “public interest” criteria of the Act are met.

[32]    On the basis of my findings on the material questions of fact, I found that the population of greater Adelaide, including the Adelaide CBD, has reasonable access to the supply of PBS medicines through a well-distributed network of community pharmacies.

[33]    Accordingly, I decided not to exercise my discretionary power under subsection 90A(2) of the Act to approve the pharmacist to supply pharmaceutical benefits at the proposed premises.

(Emphasis in original)

It was common ground that these reasons indicated that the Minister’s decision was made because she was not satisfied that the first of the two s 90A(2) criteria was established. It was accordingly unnecessary for her to reach a view in relation to the public interest criterion and it is evident that the Minister did not do so.

Alleged denial of procedural fairness

30        The respondent accepted that the Minister’s decision-making under ss 90B(5) and s 90A(2) is conditioned on observance of the rules of procedural fairness: see Hanna v Minister for Health [2013] FCA 303 at [47]; Yu v Minister for Health [2013] FCA 261 at [37]-[43]; (2013) 216 FCR 168 at 181-3. The applicant claimed that there had been a relevant denial of procedural fairness in three respects. It is convenient to address the first two in this section of the reasons, and the third in the next as it overlapped with other complaints made by the applicant.

Non-acceptance of the turnover claim

31        The appellant submitted, first, that the Minister had denied him procedural fairness as she had, without notice to him, not accepted his claim as to the proportion of the turnover of the Midnight Pharmacy between 9.00pm and midnight constituted by the supply of PBS benefits. The applicant had selected this period because, on his understanding, there was only one other pharmacy in greater metropolitan Adelaide which remained open after 9.00pm, and his (and the other pharmacy) remained open until midnight.

32        The appellant’s solicitor’s submission of 25 January 2013 supporting the request to the Minister had included the following:

Our client’s records indicate that 60% of the pharmacy’s turnover is between 9pm and midnight. Whilst the records do not at present differentiate between turnover for PBS medicines compared with turnover from other medicines and general items sold, there is no reason to suspect that the percentage of PBS medicines dispensed in the period between 9pm and midnight is anything other than 60% of the total PBS medicines dispensed at the pharmacy. The majority of PBS prescriptions dispensed by our client occur in the evening.

33        The F and E Summary provided by the Department to the Minister referred to this passage of the submission and then continued:

The pharmacist has not provided evidence to substantiate the claim that 60% of the pharmacy’s turnover for PBS medicines is between 9pm and midnight.

34        The Departmental Summary of Facts and Evidence provided to the Minister in connection with the first stage decision contained a similar Departmental comment concerning the applicant’s estimate of the proportion of PBS benefits dispensed in the period between 9.00pm and midnight.

35        Ground 1(1) of the amended application for judicial review claimed that a breach of the rules of natural justice had resulted from the Minister’s failure to provide the applicant with notice of, or an opportunity to comment upon or provide evidence in relation to, “the non-acceptance [of] the Applicant’s estimate that 60% of the Pharmacy’s turnover for PBS medicines was between 9pm and midnight”.

36        The applicant submitted that procedural fairness requires a decision-maker to identify any concerns or doubts which the decision-maker may have relating to the factual basis for an apparently credible submission which an applicant had no reason to suspect may not be accepted. He referred to the statement of principle in Commissioner for Australian Capital Territory Revenue v Alphaone Pty Ltd (1994) 49 FCR 576 at 591:

A person likely to be affected by an administrative decision to which requirements of procedural fairness apply can support his or her case by appropriate information but cannot complain if it is not accepted. On the other hand, if information on some factor personal to that person is obtained from some other source and is likely to have an effect upon the outcome, he or she should be given the opportunity of dealing with it … Within the bounds of rationality a decision-maker is generally not obliged to invite comment on the evaluation of the subject’s case …

The general proposition set out above may be subject to qualifications in particular cases. Two such qualifications were enunciated by Jenkinson J in Somaghi at 108-109:

1.    The subject of a decision is entitled to have his or her mind directed to the critical issues or factors on which the decision is likely to turn in order to have an opportunity of dealing with it …

2.    The subject is entitled to respond to any adverse conclusion drawn by the decision-maker on material supplied by or known to the subject which is not an obvious and natural evaluation of that material …

Thus, as the Full Court observed, procedural fairness may require an applicant to have the opportunity to deal with matters adverse to the applicant’s interests even though the information concerning those matters was not provided by a third party but is derived from an applicant’s own conduct or supplied material.

37        In a later passage in Alphaone, the Full Court said at 591-2:

Where the exercise of a statutory power attracts the requirement for procedural fairness, a person likely to be affected by the decision is entitled to put information and submissions to the decision-maker in support of an outcome that supports his or her interests. That entitlement extends to the right to rebut or qualify by further information, and comment by way of submission, upon adverse material from other sources which is put before the decision-maker. It also extends to require the decision-maker to identify to the person affected any issue critical to the decision which is not apparent from its nature or the terms of the statute under which it is made. The decision-maker is required to advise of any adverse conclusion which has been arrived at which would not obviously be open on the known material. Subject to these qualifications however, a decision-maker is not obliged to expose his or her mental processes or provisional views to comment before making the decision in question.

38        This second statement of principle was approved by Gleeson CJ, Gummow and Heydon JJ (with whom McHugh J agreed on this point) in Re Minister for Immigration and Multicultural and Indigenous Affairs; ex parte Palme [2003] HCA 56 at [22]; (2003) 216 CLR 212 at 219.

39        The applicant emphasised the principle that he was entitled to respond to any adverse conclusions drawn by the decision-maker on material supplied by him which was not “an obvious and natural evaluation of that material”.

40        In my respectful opinion, this submission rests on an unsound premise. It assumes that the Department and the Minister did not accept the applicant’s estimate that 60% of the supply of PBS benefits by the Midnight Pharmacy occurred between 9.00pm and midnight. However, the Minister’s findings on material facts, summarised earlier, do not advert to this aspect of the appellant’s submission, let alone reject his assertion as to turnover.

41        Nor did the F and E Summary, quoted above, contain such a rejection. It did no more than note that the applicant had not provided evidence to substantiate the claimed 60% of turnover of PBS benefits between 9.00pm and midnight. That was a matter which the applicant’s own submission, summarised by the Department, had also acknowledged. In my opinion, the manner in which this submission was expressed, using in effect a double negative, tended to emphasise that the statement concerning the proportion of PBS benefits sales was in the nature of a surmise by the applicant’s solicitor, rather than an assertion of fact.

42        Further still, a surmise that 60% of all PBS benefits dispensed by the Midnight Pharmacy are issued between 9.00pm and midnight, because 60% of the total sales of the pharmacy occurred in that period, was not, in my opinion, “an obvious and natural evaluation of [the] material”. It is a matter of notoriety that most pharmacies sell many products in addition to PBS benefits. The applicant’s own submission acknowledges that this was so in relation to the Midnight Pharmacy. In that circumstance, it cannot be said that there is any obvious, let alone necessary, connection between the aggregate sales during specified periods, on the one hand, and the particular products sold during those periods on the other. To say when sales are made is to say little, if anything, about which of a diverse range of products was sold by the pharmacy at those times. The turnover after 9.00pm at the Midnight Pharmacy claimed by the applicant may well have been attributable to the availability in the pharmacy of non-PBS benefit products sought by consumers at that time.

43        At the hearing, I received an affidavit from the applicant deposing to the response which, in retrospect, he says he would have made had he been made aware of this (and other) concerns of the Department. The applicant deposed that Midnight Pharmacy maintains a daily script register recording the time of dispensing each script and said that that register indicates that approximately 80% of the scripts are dispensed after 6.00pm. However, a statement to this effect would have been of limited utility; the claim on which the Department was commenting was the report of PBS benefits dispensed after 9.00pm, and not after 6.00pm.

44        The applicant also deposed to the average number of customers and the average sales per hour at the Midnight Pharmacy at the Wakefield Street premises in the period 15 April 2013 to 14 October 2013. It is self-evident that much of this material could not have been provided by the applicant to the Department in June 2013. Accordingly, I consider that the applicant’s affidavit is of limited utility for present purposes.

45        Finally, I note that turnover percentages were not a matter which the Minister was bound to consider in determining the applicant’s request.

46        For these reasons, I consider that the claimed denial of natural justice in relation to the applicant’s claimed turnover between 9.00pm and midnight is not established.

Availability of alternative premises: opportunity to respond

47        The applicant claimed that he should have been given the opportunity to respond to the Departmental research indicating that there were a number of retail and commercial premises available for lease within one kilometre of the West Terrace premises.

48        In the submission of 25 January 2013, the applicant’s solicitor identified the characteristics of new premises said by the applicant to be “critical”:

(a)    location in the CBD to provide centralised access to all persons in the greater metropolitan area of Adelaide;

(b)    off-street car parking to allow convenient access to persons to obtain medicines particularly in the evening;

(c)    premises of at least comparable size to the existing premises.

The solicitor said that an extensive review of potential sites in the CBD had been conducted over a period of time in an attempt to locate suitable premises for lease, and that the Wakefield Street premises were the only premises with the required characteristics which were available for long-term lease. This submission seemed, in effect, to be a claim that, upon the expiry of the lease of the West Terrace premises, the applicant had no practical alternative other than the Wakefield Street premises.

49        In the F and E Summary, the Department referred to this aspect of the applicant’s submission and then added:

    The pharmacist has not provided any evidence to support the claim that he had no other choice but to move to the proposed premises other than citing the suitability of the location of the proposed premises to operate a late night pharmacy business and its comparable size to the existing premises. The Department’s research, based on a website search of commercial premises for lease in the Adelaide CBD, found that the area within 1 km, by straight line, to the south east of the existing premises, includes a number of retail/commercial premises which are available for lease; and

    The Guidelines for Ministerial Discretion state that the commercial interests of the pharmacist making the request are not generally considered to be relevant. The “pharmacy’s business criteria” would appear to be commercial matters.

50        The applicant referred again to Alphaone and, in particular, to the proposition that procedural fairness entitled him to have the opportunity to rebut or qualify by further information, and comment by way of submission upon, adverse material from other sources put before the Minister.

51        The Minister’s statement of reasons does not refer at all to the topic of availability of alternative premises for the Midnight Pharmacy. Rather, as has been seen, the Minister relied upon the number and location of other pharmacies in the CBD and the circumstance that there were other pharmacies which were open until late at night, including the one at Glenelg which is open until midnight, and other pharmacies which were open during times similar to those of the nearby medical centres.

52        The applicant contended that the fact that the Minister had not relied on the Departmental view that there were available premises for lease within a one kilometre radius of the West Terrace premises was immaterial. Counsel submitted that procedural fairness required that he be given an opportunity to deal with “credible, relevant and significant” adverse information: Kioa v West (1985) 159 CLR 550 at 628-9; Re Minister for Immigration and Multicultural Affairs; ex parte Miah [2001] HCA 22 at [140]; (2001) 206 CLR 57 at 96-7. The applicant referred to the elaboration of this requirement in Applicant VEAL of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs [2005] HCA 72; (2005) 225 CLR 88. In relation to the obligation of an administrative decision-maker to give an applicant an opportunity to respond to “credible, relevant and significant” information even when ultimately the decision-maker has not relied on that information, the High Court said at 96-7:

[16]    … Because principles of procedural fairness focus upon procedures rather than outcomes, it is evident that they are principles that govern what a decision-maker must do in the course of deciding how the particular power given to the decision-maker is to be exercised. They are to be applied to the processes by which a decision will be reached.

[17]    It follows that what is “credible, relevant and significant” information must be determined by a decision-maker before the final decision is reached. That determination will affect whether the decision-maker must give an opportunity to the person affected to deal with the information. … “Credible, relevant and significant” must therefore be understood as referring to information that cannot be dismissed from further consideration by the decision-maker before making the decision. And the decision-maker cannot dismiss information from further consideration unless the information is evidently not credible, not relevant or of little or no significance to the decision that is to be made. References to information that is “credible, relevant and significant” are not to be understood as depending upon whatever characterisation of the information the decision-maker may later have chosen to apply to the information when expressing reasons for the decision that has been reached.

[18]    It follows that the Tribunal’s statement, that it gave no weight in reaching its decision to the letter or its contents, does not demonstrate that there was no obligation to reveal the information to the appellant and to give him an opportunity to respond to it before the Tribunal concluded its review. Deciding that it could reach its conclusion on other bases did not discharge the Tribunal’s obligation to give the appellant procedural fairness.

(Emphasis in original)

53        The rationale is that credible, relevant and significant adverse evidence can create a real risk of prejudice, possibly subconsciously, so that it is unfair for the person not to be given the opportunity to respond to it: Kioa v West at 629; VEAL at [19], 97.

54        The respondent did not challenge the applicant’s characterisation of the Department’s research as credible evidence. Instead, the respondent’s submissions were directed to the relevance and significance of this information to the applicant’s request. Counsel contended that the report of the Departmental research was not “relevantly adverse to the applicant’s interests” with the effect that the Minister had not been required to give the applicant an opportunity to comment on it.

55        The relevance of a particular matter to the Minister’s decision is to be determined objectively. Neither the view of the applicant nor the view of the Department as to what is relevant can be conclusive. An applicant cannot make a matter relevant simply by making it the subject of a submission; nor can the Department remove relevance by a bare assertion to that effect.

56        Section 90A(2) gives the guide to what may be relevant. As already seen, s 90A(2) vests a discretion in the Minister once the Minister is satisfied about two criteria. Material may be relevant to the Minister’s decision if it is capable of bearing in a rational way on the issue of whether the community in question may, in consequence of the Secretary’s decision, be left without reasonable access to PBS benefits supplied by an approved pharmacist, or if it is capable of bearing on the public interest in the pharmacist being approved to supply PBS benefits at the proposed premises. In addition, in some cases some material may be relevant to the exercise of the residual discretion which is enlivened upon the Minister’s satisfaction of the two limbs of s 90A(2).

57        On one view, the Department’s comment concerning the availability of leased premises may be said to be capable of being relevant to each of the two criteria and to the exercise of the residual discretion. That is especially so if the comment is regarded as indicating to the Minister that, despite the applicant’s claim to the contrary, suitable leased premises were in fact available to him within the one kilometre radius of the West Terrace premises.

58        However, I consider that this is not a proper understanding of the impugned passage in the F and E Summary. First, when the passage is read in context, it is in my opinion better understood as an elaboration of the Department’s critique of the applicant’s claim and of the absence of evidence to support it. A claim in 2013 that there were no alternative premises available for lease in the Adelaide CBD within the one kilometre radius which, considered objectively, would be suitable for a pharmacy was, prima facie, a surprising claim. It can be inferred that the Department took that view of the claim. Given that the applicant had made that surprising claim, the Department statement can be understood as drawing attention to the circumstance that he had not provided evidence to support the claim. It referred to its own research in that context as a means of emphasising the lack of evidence from the appellant and not, as the applicant’s submissions assumed, as an assertion that suitable alternative premises were in fact available. In short, I consider that the Departmental statement is better understood as a comment about the quality of the applicant’s supporting evidence and not the introduction of new material of a relevant or significant kind for consideration by the Minister.

59        Secondly, it was in any event implicit in the applicant’s own submission that there were premises available for lease within the one kilometre radius: his submission was that none of these was suitable. The F and E Summary did not contradict that assertion, as it was limited to drawing attention to the circumstance that there were retail and commercial premises available for lease in that area.

60        As already noted, the applicant was not entitled, in an unqualified way, to be informed on a progressive basis of the Department’s evaluation of his claim and of his evidence.

61        Accordingly, I consider that the omission of the Minister to inform the applicant of the critique of his lack of supporting evidence was not a denial of natural justice.

Opportunity to respond to material supplied by third parties

62        The applicant also claimed a denial of procedural fairness arising from the Minister’s failure to give him an opportunity to respond to material provided by third parties. Some of that material drew attention to the close proximity of the Wakefield Street premises to schools and residential areas and contended that it was inappropriate for the Midnight Pharmacy to be so located having regard, amongst other things, to the circumstance that the pharmacy is also a methadone clinic and to the clientele which it attracted.

63        In addition, two owners of other pharmacies in the CBD expressed strong opposition to the grant of the applicant’s request, giving a detailed analysis of the access to other pharmacies in the vicinity of the Wakefield Street premises, and a detailed critique of the applicant’s move from the West Terrace premises.

64        In relation to the “reasonable access” issue, the applicant’s solicitor had made a brief reference in his submissions of 16 May 2013 to the methadone clinic which the applicant conducted at the Midnight Pharmacy:

Our client also operates a methadone clinic which is a programme supported by funding through the PBS scheme. This pharmacy is the biggest single private methadone clinic in Australia. This service is provided at all hours the pharmacy is open.

This was the only reference to the methadone clinic in the materials provided by the applicant to the Minister.

65        The June Minute did not refer directly to the methadone clinic. The F and E Summary did, however, draw attention to a newspaper article provided by one of the opposing pharmacists (Mrs Tsimbinos) reporting on concerns of a school adjacent to the Wakefield Street premises about the presence of drug addicts in its near vicinity (the school itself had not made any submission to the Minister). Ms Tsimbinos’ submission, containing a copy of the article, was attached to the summary. In addition, the F and E Summary included as attachments a letter from a member of the public (Ms Blake) regarding concerns raised by local residents and a copy of a submission made by Rachel Sanderson MP of the South Australian Parliament. Ms Sanderson’s letter and attachments raised issues concerning lawless and antisocial behaviour, and vandalism in the area since the opening of the Midnight Pharmacy at the Wakefield Street premises. Ms Blake’s letter drew attention to the close proximity of the Wakefield Street premises to schools and residential premises and compared that with the commercial and entertainment precinct in which the Midnight Pharmacy had operated on West Terrace. Ms Blake also raised concerns about the adverse effect generally on the amenity of the area in the vicinity of the Wakefield Street premises since the opening of the Midnight Pharmacy.

66        The respondent submitted that, as the Minister’s statement of reasons does not refer to the third party material, it can be inferred that she did not regard it as being pertinent to her decision. This meant that she had not been required to raise the material with the applicant and to give him the opportunity to comment on it.

67        The Minister’s statement of reasons does not indicate that she placed particular reliance on the third party material. However, the statement of reasons records in [16] the evidence which the Minister said she had considered. This included the submissions in opposition by the other two pharmacists, the letter from Ms Blake and the submission from Ms Sanderson MP which it attached. It cannot be inferred therefore that this was material to which the Minister paid no regard.

68        In any event, the applicant submitted that it was immaterial that the Minister may not have placed any reliance on the third party material in her decision. He referred again to the passages in VEAL set out earlier. The applicant contended that the material from Ms Tsimbinos, Ms Blake and Ms Sanderson was “credible, relevant and significant” information in the sense discussed in VEAL, particularly in relation to the public interest criterion.

69        The respondent disputed that characterisation, contending that the third party material was not relevantly adverse to the applicant’s interests and was not in the relevant sense “credible, relevant and significant”.

70        I consider that the applicant’s submissions on this topic should be upheld. The public interest may be a nebulous concept with many matters capable of being relevant to it. It is difficult to conclude, however, that the attitude of members of the community living and working in close proximity to the Wakefield Street premises to the presence of the pharmacy was not very relevant to the assessment of the public interest. The material which the Minister had on that topic was adverse to the applicant and he was unaware that it had been provided to the Minister. I also consider that the opposition of local residents, in particular, was capable of having a prejudicial effect in the Minister’s mind. This material could not reasonably be dismissed as non-credible or as having no, or limited, significance.

71        I observe that, in VEAL, the Tribunal had stated positively that it had given “no weight” to the undisclosed adverse material provided to it, and yet was found to have denied procedural fairness to the applicant. In this case, the Minister has not made any statement to that effect.

72        I have considered whether the circumstance that the third party material related to the second limb of the consideration under s 90A(2), which the Minister did not address, may allow the approach in VEAL to be distinguished. However, I am satisfied that such a distinction would be inappropriate. First, s 90A(2) does not provide for a two-stage or sequential inquiry. The Minister was not to consider the public interest criterion only after considering the issue concerning reasonable access. It was open to the Minister to consider the material relating to both limbs at the one time.

73        Secondly, there is no indication that the Minister did in fact adopt a sequential approach. On the contrary, the Department had provided a single Minute in June 2013, addressing all issues. Nor do the Minister’s reasons contain any statement to the effect that she had decided upon a sequential approach to decision making.

74        Thirdly, the third party material was not, in any event, confined to the public interest criterion. Ms Tsimbinos indicated at the commencement of her submission that it was directed to both the “reasonable access” and “public interest” criteria. That assertion is borne out by the submission’s content as it includes a cogent submission on the “reasonable access” issue. The submission of the second opposing pharmacist was principally directed to the “reasonable access” criterion, although one aspect was more relevant to the issue of public interest.

75        Fourthly, I consider that the third party material was capable of having a prejudicial effect, whether consciously or subconsciously, on the Minister’s approach to the determination of both limbs under s 90A(2).

76        The respondent made one further submission. This was to the effect that the applicant had been on notice of some community concern about the methadone clinic at the Wakefield Street premises. The submission was that, the applicant, being aware of that concern, had had the opportunity to make any submission he wished on the topic to the Minister.

77        I agree that the evidence of comments made by the applicant in the local press shows that he was aware of some community concern regarding the methadone clinic. However, I consider, with respect, that this submission of the respondent cannot be accepted. There is no indication that the applicant was on notice at all of the submissions of the two pharmacists, or of the submission made by Ms Sanderson, or that their concerns were being pressed on the Minister as a reason for the refusal of his request, or of all the detail in which the presence of the methadone clinic was said to be pertinent to his request.

78        This means, in my opinion, that the applicant did not have proper notice of the adverse matters, nor an opportunity to address them. There was, accordingly, a denial of procedural fairness.

79        Accordingly, I am satisfied that the applicant has made good this limb of his application for judicial review.

Alleged failure to address the applicant’s claim

80        A significant proportion of the applicant’s submissions was directed to a complaint that the Minister had not addressed “the primary basis” of his claim, namely, that the Midnight Pharmacy was the only pharmacy in the CBD, and one of only two pharmacies in greater metropolitan Adelaide, trading until midnight. The applicant claimed that the Minister’s failure to address this “primary basis” of his claim was relevant as indicating: that the decision was an improper exercise of the power under s 90A; that it was not authorised by s 90A; and that it was a denial of procedural fairness. He thereby invoked subpars (e), (d) and (a) respectively of s 5(1) of the ADJR Act.

Section 5(1)(e)

81        Section 5(1)(e) allows for review under the ADJR Act when the making of a decision is “an improper exercise of the power conferred by the enactment in pursuance of which it was purported to be made”. Section 5(2) elaborates the circumstances which may indicate such an improper exercise of power. The applicant relied on subs (2)(b), i.e., failing to take a relevant consideration into account.

82        The matters which it was said that the Minister had failed to take into account were:

(a)    Whether, if the Secretary’s decision stood, the relevant community or communities would be left without reasonable access to pharmaceutical benefits because there would:

(i)    no longer be a pharmacist located in the Adelaide CBD which provided pharmaceutical benefits during Extended Trading Hours:

(ii)    only be one pharmacy in greater metropolitan Adelaide and located in Glenelg which provided pharmaceutical benefits during the Extended Night Hours;

(iii)    only be one pharmacy in the Adelaide CBD open during … 7.30am and 8.30am on weekdays in circumstances where that pharmacy is located in Rundle Mall and does not have easily accessible parking whereas the proposed premises has easily accessible parking.

(b)    the need or desirability of the relevant community or communities being able to obtain pharmaceutical benefits during Extended Trading Hours including:

(i)    the inability or difficulty of accessing pharmacies, caused by commitments during normal trading hours;

(ii)    the need or desirability to obtain pharmaceutical benefits:

a.    from a repeat script;

b.    following an after-hours home visit by a doctor;

c.    by reason of pressing or urgent medical conditions;

d.    through referrals of out-patients from Emergency Centres;

e.    through referrals from hotel guests, particularly in the hotels in the Adelaide CBD.

(c)    the level of demand of the relevant community or communities for pharmaceutical benefits during Extended Trading Hours;

(d)    the availability or accessibility to the community or communities of pharmaceutical benefits during Extended Trading Hours;

(e)    the unavailability of suitable premises for lease within a radius of 1 km of the then existing premises.

The applicant used the expression “Extended Trading Hours” in these paragraphs as a reference to 9.00pm to midnight on weekdays and 5.30pm to midnight on weekends.

83        As can be seen, with the exception of subpars (a)(iii) and (e), the matters which it was said the Minister had not taken into account were various features bearing upon the access of the community to PBS benefits between 9.00pm and midnight on weekdays and 5.30pm to midnight on weekends. Subpar (a)(iii) relates to a one hour window at the beginning of the day and subpar (e) to the unavailability of suitable alternative premises for the Midnight Pharmacy.

84        As is well established, s 5(2)(b) of the ADJR Act does not entitle an aggrieved person to list matters which might conceivably be relevant to the administrative decision and then to attack the decision on the ground that one of those matters was not taken into account. Instead an applicant must establish that the decision-maker failed to consider a matter which he or she was, in the circumstances, bound to take into account: Sean Investments Pty Ltd v MacKellar (1981) 38 ALR 363 at 375; Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24 at 39-40. Whether or not a decision-maker is bound, as a matter of law, to take a consideration into account is to be determined by the terms of the statute in question.

85        In the present case, once the Minister decided under s 90B(4) to consider the applicant’s request, she was bound to decide personally, within three months, whether to exercise the power under s 90A(2) to substitute her own decision for that of the Secretary. The Minister would cease to be so bound only upon the elapse of the three month period. Although s 90B(5) requires the Minister to “decide whether to exercise the power under subsection 90A(2)” this seems to be equivalent to “make a decision under s 90A(2)”. It is then but a short step to conclude that the Minister was bound to consider the two matters to which s 90A(2) refers, being the issues of reasonable access and the public interest.

86        The manner in which an applicant frames a request under s 90B, which may ultimately enliven the Minister’s duty under subs (5), cannot alter the matters to which the Minister is required to have regard under s 90A(2). Putting the residual discretion to one side, the Minister must be satisfied about the two matters identified, and those two matters only. It is implicit that the Minister should consider any matter which is necessarily an integer of those two matters. However, there is a difficulty in concluding that certain matters are essential integers of the reasonable access criterion as s 90A(3) of the NH Act expressly leaves the determination of the relevant community and the meaning of “reasonable access” to the opinion of the Minister. This has the consequence that it is not open to an applicant to require the Minister to consider the relevant “community” to be a particular group or segment of a larger community. Nor is it possible for an applicant to dictate in a request to the Minister that reasonable access to PBS benefits involves access to them at the particular times at which the pharmacist is prepared to trade.

87        The applicant’s 25 January 2013 submission to the Minister suggested that the relevant community comprised those persons who, from time to time, chose to obtain PBS benefits after 9.00pm on any evening. Unsurprisingly, the Minister did not act on that self-serving suggestion. It is implicit in [32] of the Minister’s statement of reasons that she regarded the relevant community as being the population of greater Adelaide, including those in the Adelaide CBD.

88        In my respectful opinion, it cannot reasonably be said that any of the matters to which the applicant submitted the Minister had failed to have regard was an essential integer in consideration of whether the population of greater Adelaide would be left without reasonable access to PBS benefits if the Secretary’s decision stood. That question had to be determined more broadly than by enquiring about only a limited period in each day. It follows that the Minister was not bound to consider all the matters to which the applicant referred. It may have suited the applicant’s purposes to emphasise a point of difference in the trading hours of the Midnight Pharmacy, but it does not follow that the Minister was bound to consider his application in the same way.

89        Perhaps recognising this difficulty, counsel for the applicant submitted that a statute providing for the making of a decision following an application from a person who stands to benefit from the exercise of the power, requires that the bases for the exercise of the power advanced by that person be considered. Counsel referred to Htun v Minister for Immigration and Multicultural Affairs [2001] FCA 1802 at [42]; (2001) 194 ALR 244 at 259. In that case, the Full Federal Court held that the Refugee Review Tribunal (RRT) had not considered all of the bases upon which the applicant had sought refugee status. In particular, although the Tribunal had dealt with the applicant’s claim based on his own ethnicity, it had not addressed the claim of the applicant, as a person of Karen ethnicity, of persecution arising from his friendship with members of the Karen National Liberation Army. Allsop J (as he then was), with whom Spender J agreed, said (at [42], 259):

This is not merely one aspect of evidence not being touched. It is not a failure to find a “relevant” fact. The Tribunal failed to address and deal with how the claim was put to it, at least in part. The requirement to review the decision under s 414 of the Act requires the Tribunal to consider the claims of the applicant. To make a decision without having considered all the claims is to fail to complete the exercise of jurisdiction embarked on. The claim or claims and its or their component integers are considerations made mandatorily relevant by the Act for consideration …

90        The applicant also referred to Minister for Immigration and Multicultural Affairs v Yusuf [2001] HCA 30; (2001) 206 CLR 323 in which McHugh, Gummow and Hayne JJ said, at [75], 348-9:

If the Tribunal, confronted by claims of past persecution, does not make findings about those claims, the statement of its reasons and findings on material questions of fact may well reveal error. The error in such a case will most likely be either an error of law (being an erroneous understanding of what constitutes a well-founded fear of persecution) or a failure to take account of relevant considerations (whether acts of persecution have occurred in the past).

91        I consider that this claim of the applicant fails for three reasons. First, each of Htun and Yusuf, and the earlier decisions of Sellamuthu v Minister for Immigration and Multicultural Affairs [1999] FCA 247; (1999) 90 FCR 287; Chen v Minister for Immigration and Multicultural Affairs [2000] FCA 1901; (2000) 106 FCR 157; and Minister for Immigration and Multicultural Affairs v Sarrazola (No 2) [2001] FCA 263; (2001) 107 FCR 184 to which the Full Court in Htun referred, concerned the duty of the RRT under s 414 of the Migration Act 1958 (Cth) (or a counterpart of s 414) to conduct a review of the subject decision. It is implicit in the requirement to conduct a review under that section that the RRT consider all the claims, and the component elements of a claim, that an applicant has the defined status. Its obligation is similar to that of the Administrative Appeals Tribunal under s 25 of the Administrative Appeals Tribunal Act 1975 (Cth). The task required of the Minister under s 90B of the NH Act is of a different character, being a duty to consider whether to exercise the power under s 90A(2) having regard to the two specified criteria, neither of which is personal to the applicant. The reasoning in Htun and Yusuf cannot be applied without regard to this difference in the Minister’s function.

92        Secondly, the applicant’s submission assumes an inquiry by the Minister which the terms of s 90A(2) did not require of her. The submission assumes that the Minister could not consider whether the Secretary’s decision meant that the community of greater Adelaide was left without reasonable access to PBS benefits without considering its access to such benefits in particular (and limited) periods each day. The Minister was not bound to make that enquiry. Instead, the first limb of s 90A(2) required the Minister to consider the availability of PBS benefits to the Adelaide community more generally having regard to the location of pharmacies and the hours during which they are open for business. A conclusion as to access to PBS benefits between 9.00pm and midnight on weekdays and 5.30pm to midnight on weekends could form part of the Minister’s consideration, but it was not a necessary integer of the required decision. The Adelaide community could be found to have reasonable access to PBS benefits without specific reference to those hours, in exactly the same way as it could be found to have that access without reference to, say, the hours from midnight to 7.30am when the Midnight Pharmacy is closed.

93        Thirdly, the Minister’s findings of fact indicate that she did, in any event, address evening and night access to PBS benefits in Adelaide. She made specific reference to other pharmacies which closed late and to their locations. The applicant acknowledged that the Minister had noted pharmacies closing at 10.00pm, but submitted that that made it necessary for the Minister to address the period between 10.00pm and midnight. I do not accept that submission. The Minister may not have adverted to every argument which the applicant put forward in relation to reasonable access but it is plain that the Minister did address, and make specific findings concerning, evening and night access to PBS benefits.

94        The applicant referred to the “demand” for access to PBS benefits between 9.00pm and midnight said to be evidenced by the patronage of the Midnight Pharmacy, with the implication that this amounted to a “need” for PBS benefits to be available at that time. The material provided to the Minister did not evidence a “demand” in that sense. The circumstance that some members of the community may find it convenient to obtain PBS benefits at that time is not necessarily synonymous with there being a “demand” that those benefits be available at those times.

95        For similar reasons, the Minister was not bound to consider the availability of PBS benefits between 7.30am and 8.30am.

96        The applicant’s contention that the Minister did not address the claim that there were no suitable business premises for the Midnight Pharmacy within one kilometre of the West Terrace premises is correct. Again, however, the Minister was not bound to address this consideration. It was not an essential integer of the matters required by s 90A(2). The requirement that the Minister address the two limbs in s 90A(2) did not require that she address separately every argument by which the applicant sought to establish those limbs.

97        The complaint that the Minister failed to have regard to relevant considerations fails.

Section 5(1)(d)

98        By s 5(1)(d) of the ADJR Act, administrative decisions may be reviewed on the ground that they were made ultra vires. I did not understand either the applicant’s written outline of argument or the oral submissions on his behalf to address separately this ground of review in the amended application. I consider that there is no reasonable basis upon which it could be concluded that the Minister’s refusal of the applicant’s request could be regarded as having been beyond power.

Section 5(1)(a)

99        By Ground 1(3) of the amended application, the applicant alleged that the Minister had failed to provide him with notice of, or an opportunity to comment upon or provide evidence in relation to, the need or desirability of the community being able to obtain PBS benefits between 9.00pm and midnight in certain circumstances. Expressed this way, the claim is untenable as the applicant did have the opportunity to address those matters and did, as a matter of fact, do so.

100        However, the complaint on this ground, as advanced in the submissions, was that the Minister had denied the applicant procedural fairness by failing to “grapple” with the “central basis” upon which he had advanced his request for a substituted decision, being the “demand” for access to PBS benefits between 9.00pm and midnight. As part of this submission, the applicant contended that the community, for the purposes of s 90A(2)(a), should be identified as those residents of the greater metropolitan area of Adelaide who wished to obtain PBS benefits after 9.00pm on any evening. He said that there were persons who sought PBS benefits late at night, including those who had a pressing or urgent need for such benefits, those who had been referred from hospital emergency centres, patrons of hotels in the CBD, and others who found it convenient to have prescriptions filled during these hours.

101        The applicant contended that procedural fairness required that the Minister, in determining his request, turn her mind to, and address, this central basis for his request. He submitted that the Minister’s reasons indicated that she had not done so.

102        The applicant referred to Dranichnikov v Minister for Immigration and Multicultural Affairs [2003] HCA 26 at [24]; (2003) 197 ALR 389 at 394, in which Gummow and Callinan JJ, with whose reasons Hayne J agreed, held that “[t]o fail to respond to a substantial, clearly articulated argument relying upon established facts” was a denial of natural justice. He contended that the Minister’s statement of reasons indicated a failure to grapple with his submission at all. Had the Minister done so, one would have seen in the reasons, the applicant submitted, reference to the “demand” for PBS benefits between 10.00pm and midnight, the fact that there was only one other pharmacy in greater Adelaide open after 10.00pm, and to other like matters.

103        In my opinion, this challenge of the applicant fails at the factual level. As already seen, under s 90A(3), a “community” is defined to be a group of people that, “in the opinion of the Minister”, constitutes a community. It can be inferred from [32] of the Minister’s reasons, that she regarded the relevant community as the population of greater Adelaide, including the Adelaide CBD, and therefore that the Minister rejected the applicant’s more confined definition of the relevant “community”. It is hardly surprising that the Minister rejected the self-serving and somewhat circular definition of community proposed by the applicant.

104        That the Minister did grapple with the access by the Adelaide population to PBS benefits outside ordinary business hours, and the extent to which the Midnight Pharmacy at the Wakefield Street premises would add to that access, is seen in [19]-[28] inclusive of her reasons. In those paragraphs, the Minister addresses directly the times and places at which the Adelaide community may gain access to PBS benefits. Her conclusion, following this recitation of findings, was that the decision of the Secretary’s delegate would not result in a community being left without reasonable access to PBS benefits supplied by an approved pharmacist. This case is quite different from the circumstances considered by the High Court in Dranichnikov, in which the Tribunal at first instance had misidentified the particular social group of which the applicant claimed to be a member and therefore had not addressed at all the basis of the applicant’s claim. In this case, the Minister has addressed the central basis of the applicant’s claim, even though she may not have made specific findings about every matter which the applicant advanced in support of that claim, nor addressed it in the rather self-serving way sought by the applicant.

105        This ground fails.

Alleged errors of law

106        The applicant alleged four separate errors of law by the Minister and thereby sought to invoke s 5(1)(f) of the ADJR Act.

Inadequacy of reasons

107        The applicant submitted first that the Minister had failed to give adequate reasons for her conclusion. Then, relying on Wingfoot Australia Partners Pty Ltd v Kocak [2013] HCA 43 at [27]-[28]; (2013) 303 ALR 64 at 72-3, he contended that this failure constituted an error of law for which relief under the ADJR Act could be granted.

108        The thrust of the applicant’s submissions appears in the following paragraph of his written outline:

[32]    The reasons of the Minister simply do not grapple at all with the Applicant’s contention that the community of greater Adelaide would be left without reasonable access to the supply of PBS medicines by an approved pharmacist because there was a substantial demand for PBS medicines late at night, which would not otherwise be met. Rather, they proceed on the footing that the community has reasonable access because there is a well-distributed network of community pharmacies. The Applicant’s case in no way depended upon a suggestion that there was anything but a well-distributed network of pharmacies.

109        The obligation of the Minister to give reasons was imposed by s 13(1) and (2) of the ADJR Act:

(1)    Where a person makes a decision to which this section applies, any person who is entitled to make an application to the Federal Court or the Federal Circuit Court under section 5 in relation to the decision may, by notice in writing given to the person who made the decision, request him or her to furnish a statement in writing setting out the findings on material questions of fact, referring to the evidence or other material on which those findings were based and giving the reasons for the decision.

(2)    Where such a request is made, the person who made the decision shall, subject to this section, as soon as practicable, and in any event within 28 days, after receiving the request, prepare the statement and furnish it to the person who made the request.

Thus, the Minister was obliged to set out her findings on material questions of fact, to refer to the evidence on which those findings were based, and to give reasons for her decision.

110        In relation to a similarly expressed requirement for reasons, McHugh, Gummow and Hayne JJ (with whom Gleeson CJ agreed) said in Minister for Immigration and Multicultural Affairs v Yusuf [2001] HCA 30 at [68]; (2001) 206 CLR 323 at 346:

… In its terms, [s 430] requires no more than that the Tribunal set out the findings which it did make. Neither expressly nor impliedly does this section require the Tribunal to make, and then set out, some findings additional to those which it actually made. In Singh, significance was attached to the use of the word “material” in s 430(1)(c). It was said that “material” in the expression “material questions of fact” must mean “objectively material”. Even if that were right, it would by no means follow that the Tribunal was bound to set out findings that it did not make. But it is not right to read “material” as providing an objective or external standard of materiality. A requirement to set out findings and reasons focuses upon the subjective thought processes of the decision-maker. All that s 430(1)(c) obliges the Tribunal to do is set out its findings on those questions of fact which it considered to be material to the decision which it made and to the reasons it had for reaching that decision.

(Citations omitted) (Emphasis in original)

In Wingfoot, at [55], 79, the High Court found that reasons provided under an analogous requirement, in s 68(2) of the Accident Compensation Act 1985 (Vic), “must explain the actual path of reasoning by which the [decision-maker] in fact arrived at the opinion the [decision-maker] in fact formed”. Similarly, reasons provided under s 13 of the ADJR Act will be adequate if they explain the decision-maker’s actual path of reasoning.

111        In my opinion, the Minister’s reasons in the present case meet that standard and indicate that she did address directly the applicant’s claim. The Minister made findings of fact in some detail concerning the availability of pharmacies in reasonable proximity to the Wakefield Street premises, and the usual trading hours of those pharmacies. Those findings indicate the basis for the Minister’s conclusion in [32]. The Minister said as much in the preface to [32].

112        It is true, as the applicant submitted, that the Minister’s conclusion that the population of greater Adelaide, including the Adelaide CBD, has reasonable access to the supply of PBS benefits through a well-distributed network of community pharmacies is a conclusion which depends for its force on some intermediate findings of fact. However, many of those intermediate findings are found in that section of the reasons headed “Findings on material questions of fact” and, in particular, in [20]-[28].

113        The Minister said at [29] of her reasons that she accepted the Department’s “analysis” in the June Minute. I was at one stage troubled by this statement as it was not clear that the June Minute did contain any analysis which could have been accepted by the Minister. However, on reviewing the Minute and its attachments, I consider that it can be inferred that the Minister was referring to [20]-[21] of the Minute and the elaboration of those matters in [14]-[22] of the F and E Summary. The former summarise matters which were both supportive of, and counter to, the applicant’s request. In addition to setting out relevant factual background, the latter paragraphs include a summary of the applicant’s claims together with some commentary by the Department on those claims. They constitute a form of analysis. It is evident that this is the material on which the Minister reached her conclusion (that is, the Minister’s conclusion and not that of the Department) contained in [29] of the statement of reasons that “there were no unintended consequences of the application of the Pharmacy Location Rules in this particular case”. It is also evident that it is that analysis, together with the Minister’s findings of fact, which led to her conclusion that the decision of the Secretary’s delegate would not result in a community being left without reasonable access to PBS benefits supplied by an approved pharmacist – see [29] of the reasons.

114        Accordingly, this ground of the application fails.

Adoption of a Departmental conclusionary statement

115        The applicant submitted that the Minister had erred by adopting, without independent consideration, a conclusionary statement in the June Minute to the Minister that “[t]he population of greater Adelaide, including the Adelaide CBD, has reasonable access to the supply of PBS medicines through a well-distributed network of community pharmacies”. He submitted that the framing of the question in this way was to assume the question which the Minister had to answer. The applicant submitted that the Minister had thereby been distracted from considering whether the population of greater Adelaide was left without reasonable access to PBS benefits in the period between 9.00pm and midnight.

116        For the reasons already given, I do not consider that this was the question which the Minister had to address.

117        Again, for reasons already given, I consider that it is apparent from her reasons that the Minister was well aware that the question to be addressed was whether the Secretary’s decision would result in the community (considered by the Minister to be the population of greater Adelaide) being left without reasonable access to PBS benefits supplied by an approved pharmacist, and not the more narrow question proposed by the applicant. I also consider that the Minister’s reasons, and in particular [17]-[29], indicate that she did not simply adopt a conclusionary statement of the Department.

Regard to commercial considerations

118        In its F and E Summary, the Department listed for the Minister some “relevant considerations”. Then, under the heading “Irrelevant considerations”, the Department said:

[13]    The commercial interests of the pharmacist making the request, or of any other party, are not generally considered to be relevant.

119        The applicant submitted that this involved an error of law because the commercial interests of an applicant pharmacist were not a consideration that the Minister was prohibited by law from considering. For the Minister to have proceeded on the basis that she was prohibited from considering it was to misapprehend the limits of her power, and therefore to have erred in law.

120        In my respectful opinion, this ground fails. There is no indication, whether in the F and E Summary or in the Minister’s own reasons, that she regarded herself as prohibited in law from considering the applicant’s commercial interests and, in particular, his views as to the kind of premises appropriate for the Midnight Pharmacy. It is also to be observed that the June Minute said no more than that the commercial interests of an applicant pharmacist are not “generally” considered to be relevant.

Asking the wrong question

121        The applicant submitted that the Minister had asked herself the wrong question. He contended that s 90A(2)(a) required the Minister to consider the position in the future, on the hypothesis that approval to supply PBS benefits from the Wakefield Street premises was rejected.

122        The applicant submitted that, instead of addressing that question, the Minister had effectively inquired whether it was necessary for the Midnight Pharmacy to relocate in order that the community have reasonable access to PBS benefits.

123        In making this submission, the applicant did not refer to any aspect of the Minister’s reasons. Instead, he referred to a passage in the F and E Summary which had indicated that two relevant matters for her consideration were “the community’s current level of access” to the supply of PBS benefits by an approved pharmacist and whether that access is “reasonable”. In my respectful opinion, this passage provided only a flimsy basis for the submission which it was said to support.

124        In context, the Departmental reference to “the community’s current level of access” was a reference to the access which the community has without the Midnight Pharmacy operating at the Wakefield Street premises. Plainly, that circumstance was relevant to the question of whether the Secretary’s decision would result in the community being left without reasonable access to pharmaceutical benefits. Accordingly, it was appropriate for the Minister to have regard to that matter. On the assumption, therefore, that the Minister did adopt this particular part of the F and E Summary, it cannot be concluded that she asked herself the wrong question.

125        This ground of the application for judicial review fails.

A question of relief

126        For these reasons, the applicant succeeds on only one of the grounds of judicial review which he advanced. That is, that the Minister denied him procedural fairness by not giving him the opportunity to respond to the adverse material provided to the Minister by the third parties. Two issues arise in respect of that finding.

127        The first is that of whether the Court should exercise the discretion under s 16 of the ADJR Act against granting the applicant the relief which he seeks. That is because, although the Wakefield Street premises had not been approved, the applicant did relocate to those premises and commenced trading at them on Monday, 15 April 2013. In order to meet the condition of supplying PBS benefits only from approved premises, the applicant adopted the stratagem of supplying those benefits to customers at the Wakefield Street premises but recording them at the West Terrace premises. On its face, there appears to be a question about the lawfulness of this arrangement. The Court is unable presently to reach any conclusion on that question. However, when the Court raised the possible implications of the applicant’s conduct in relation to the grant of relief under s 16 of the ADJR Act, the applicant, through his counsel, gave an undertaking to the Court that, pending the outcome of these proceedings and this Court’s reasons, he would not claim the subsidy from the Commonwealth in respect of the PBS benefits, if any, sold from the Wakefield Street premises from the date of the hearing. He contended that giving effect to that undertaking would avoid any suggestion of unlawfulness in his conduct.

128        The respondent did not contend that any relief to which the applicant would otherwise be entitled should be withheld on the ground of the applicant’s conduct in relation to the commencement of business at the Wakefield Street premises without an approval in relation to those premises. In these circumstances, I accept that the applicant should be granted relief in respect of the denial of procedural fairness.

129        The second issue arises from the change in the identity of the Minister for Health since the Minister’s decision of 26 June 2013. However, s 16(1)(b) may be construed as permitting the remittal of the matter to the person for the time being occupying the office of the Minister for Health. The respondent did not contend otherwise.

Conclusion

130        For the reasons given above, I make the following orders:

(1)    The decision of the Minister of 26 June 2013 under s 90A(2) of the National Health Act 1953 (Cth) not to approve the applicant to supply pharmaceutical benefits at 192-198 Wakefield Street, Adelaide is quashed.

(2)    The applicant’s request of 25 January 2013, as supplemented by the letter from the applicant’s solicitor of 16 May 2013, for the Minister for Health to exercise the power under s 90A(2) of the National Health Act 1953 (Cth) in respect of the premises at 192-198 Wakefield Street, Adelaide, is referred back to the Minister for Health for further consideration.

131        I will hear from the parties as to costs.

Associate:

Dated:    4 July 2014