RICHARD EDWIN PEVERILL v. DAVID LEON BACKSTROM; CHARLES AKRILL MITCHELL; ERNEST HUMPHREY CRAMOND; STEWART JAMES BRYANT and MINISTER FOR HEALTH, HOUSING AND COMMUNITY SERVICES No. NG377 of 1994 FED No. 996/94 Number of pages - 28 Administrative Law - Medicine (1994) 127 ALR 197 (1994) 54 FCR 410 (1994) 38 ALD 14

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RICHARD EDWIN PEVERILL v. DAVID LEON BACKSTROM; CHARLES AKRILL MITCHELL; 
ERNEST HUMPHREY CRAMOND; STEWART JAMES BRYANT and MINISTER FOR HEALTH, HOUSING
AND COMMUNITY SERVICES
No. NG377 of 1994
FED No. 996/94
Number of pages - 28
Administrative Law - Medicine
(1994) 127 ALR 197
(1994) 54 FCR 410

(1994) 38 ALD 14
COURT

IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION LOCKHART, GUMMOW AND LEE JJ CWDS

Administrative Law - natural justice - Wednesbury unreasonableness - pathology services - Medical Services Committee of Inquiry - expertise of committee - excessive services - particulars of matters to which hearing relates - severity of penalty. Medicine - pathology services - excessive services - "personal fault" of practitioner - meaning thereof - whether services "not reasonably necessary for the adequate medical care of the patient". Health Insurance Act 1973 Health Insurance Amendment Act 1977 Health Legislation Amendment Act 1986 Community Services and Health Legislation Amendment (No. 2) Act 1990 Health and Community Services Legislation Amendment Act 1991 Health Insurance Amendment (No. 2) Act 1991 Health, Housing and Community Services Legislation Amendment Act 1992 Tiong v Minister for Community Services and Health (1990) 93 ALR 308 Minister of State for Health v Peverill (1991) 29 FCR 262 Minister for Health v Thomson (1985) 8 FCR 213 Cunliffe v Commonwealth of Australia (1994) 124 ALR 120 HRNG

SYDNEY, 26-27 September 1994 #DATE 19:12:1994 Counsel and solicitors Dr G.A. Flick SC and for the appellant: Mr A. Robins instructed by Minter Ellison Morris Fletcher. Counsel and solicitors Mr J.S. Hilton SC and for the fifth respondent: Ms R.M. Henderson instructed by Australian Government Solicitor. The first, second, third and fourth respondents filed a submitting appearance. ORDER

The Court orders that: (1) Orders 2 and 3 made by the primary Judge on 16 June 1994 be set aside. (2) The appeal otherwise be dismissed. (3) The appellant pay the costs of the respondents of the appeal, and of the motion referred to in order 7 made by the primary Judge on 16 June 1994. (4) The costs of the first, second, third and fourth respondents provided for in order 3 be those of a submitting party. Note: Settlement and entry of orders is dealt with by Order 36 of the Federal Court Rules. JUDGE1

LOCKHART, GUMMOW AND LEE JJ This appeal from a Judge of this Court (Einfeld J) involves important questions of construction of provisions of the Health Insurance Act 1973 ("the Act") relating to over-servicing. In particular, it concerns the position of specialist pathologists who have been requested to perform unnecessary procedures by medical practitioners. 2. The appellant, Dr Peverill, is a specialist pathologist operating a number of practices in Queensland and the Northern Territory. During the relevant time, Dr Peverill operated 7 laboratories and 50 related surgeries. Dr Peverill was personally responsible for supervising 4 of the laboratories (Springwood, Gold Coast, Alice Springs and Darwin) and he employed other pathologists to supervise the laboratories at Ipswich and Cairns. The seventh laboratory (Townsville) was partly owned and fully operated by another practitioner (Dr Lau). 3. On 3 February 1987, a delegate of the fifth respondent ("the Minister") referred certain matters concerning Dr Peverill to the Medical Services Committee of Inquiry for the State of Queensland ("the Committee"). The reference was made under s. 82 (b) of the Act. The first four respondents are the members of the Committee. At the time of the referral by the Minister, s. 82 (b) was as follows: "82 A Committee shall inquire into, and submit to the Minister its report and recommendations on - (a) ... (b) any other matter referred to the Committee by the Minister, being a matter that is relevant to the operation or administrat-ion of this Act ... and arises out of or relates to - (i) an undertaking accepted by the Minister under section 16C; or (ii) the rendering of a professional service on or after 15 April 1977, or the initiation of a pathology service on or after the date of commencement of this section, in the State for which the Committee is established." 4. The instrument of referral states that the delegate refers matters: "which arise out of whether Dr Richard Edwin Peverill complied with an undertaking given by him and accepted by the Minister under section 16C of the said Act, and which further arise out of the rendering of professional services in the State of Queensland after 15 April 1977, namely, whether each professional service rendered to a patient by Dr Richard Edwin Peverill, particulars of which are set out in Annexures 'B1' to 'B251', being a service for which Medicare benefit became payable, was an excessive service within the meaning of section 79 (1B) (a) of the (Act)." 5. We shall deal with the relevance of the s. 16C undertaking later in these reasons. 6. On 9 February 1987, the Committee met to consider the reference and determined to hold a hearing into the matters the subject of the reference. Dr Peverill was informed of this on 16 April 1987. The hearing commenced on 10 June 1987. The hearing was much delayed and the Committee sat for only 14 days between that date and the conclusion of the hearing on 6 April 1992. One interruption involved a proceeding taken by Dr Peverill in this Court, to which we refer hereafter. 7. The Committee delivered its report to the Minister on 29 May 1992. The report identifies 129 instances of over-servicing by Dr Peverill. The Committee recommended, pursuant to sub-s. 105 (2) of the Act, that: "(i) Dr Peverill be reprimanded in relation to his neglect of professional responsibility in the rendering of pathology services. (ii) Dr Peverill be counselled in relation to the rendering of fixed combinations of tests, irrespective of the clinical information. (iii) The Minister revoke his acceptance of the Undertaking by Dr Peverill given under section 16C of the (Act). (iv) The amount of Medicare benefit totalling $11,931.80 as identified in Tables 1 to 129 of the Report and set out in the Schedule of Excessive Services (Appendix No. 130) be payable by Dr Peverill to the Commonwealth of Australia." 8. On 27 August 1992, the Minister made a determination under s. 106 of the Act as follows: "(i) Under paragraph 105 (2) (c) of the Act, (Dr Peverill), as a specialist in pathology and an Approved Pathology Practitioner for the purposes of the (Act), be reprimanded for neglecting his professional responsibility in the rendering of pathology services; (ii) Under paragraph 105 (2) (ca) of the Act, (Dr Peverill) be counselled for his provision of multiple pathology tests irrespective of the needs of the patients and clinical information provided by initiating practitioners; and (iii) Under paragraph 105 (2) (f) of the Act, the amount of Medicare benefits referred to in paragraph (c) above, that is an amount of $11,931.80 in total, herein be payable by (Dr Peverill) to the Commonwealth of Australia." 9. In a letter to Dr Peverill dated 28 August 1992 enclosing the determination, the Minister noted that s. 106AB of the Act required a penalty payment equivalent to the amount of his determination, bringing the total payable to $23,863.60. The Minister also explained why he had not acted upon the third recommendation of the Committee, relating to the s. 16C undertaking. We shall return to this subject. 10. On 15 March 1993, Dr Peverill instituted an application under the Administrative Decisions (Judicial Review) Act 1977 to review both the decision of the Committee and the determination of the Minister. The application was dismissed by the primary Judge on 31 May 1994. Dr Peverill appeals from this decision. 11. It is appropriate at this stage to consider the relevant provisions of the Act. The Act 12. The pathology services under investigation by the Committee were provided to patients between 15 January and 26 September 1986. We shall therefore deal with the Act as it was at these dates. It is necessary to recount various changes to the legislation over the period with which this litigation is concerned. 13. So far as material, s. 16A of the Act was as follows: "16A (1) A Commonwealth medical benefit is not payable in respect of a pathology service unless a practitioner determined that the service was necessary and - (a) in the case of a pathology service ... - the service was rendered by or on behalf of an approved pathology practitioner in pursuance of a request addressed to that approved pathology practitioner - (i) by the practitioner who determined that the service was necessary; or (ii) by another approved pathology practitioner who is not the practitioner who determined that the service was necessary, being a request made in writing as prescribed or, if made otherwise than in writing, subsequently confirmed in writing as prescribed; (b) ... or (c) ... ... (5) For the purposes of this section - (a) where a service is rendered by a person (in this paragraph referred to as 'the employee') in the course of his employment by another person, then, except in a case to which paragraph (b) applies, it shall be deemed to be rendered by that other person, and not by the employee; (b) where a person (in this paragraph referred to as 'the employee') is employed by two or more persons jointly and a service is rendered by the employee in the course of that employment, it shall be deemed to be rendered by the employer principally responsible for the matter being dealt with by the employee, and not by the employee; (c) a service shall be taken to be rendered on behalf of a person if, and only if, it is rendered by another person, not being an approved pathology practitioner, by arrangement with that person; ..." 14. An "approved pathology practitioner" is defined in sub-s. 3 (1) to include a person in respect of whom there is in force an undertaking given by him and accepted by the Minister under s. 16C. Dr Peverill was an "approved pathology practitioner" at the relevant time. 15. Section 16B relevantly was as follows: "16B (1) The Minister may draw up forms of undertaking to be given by persons who wish to become approved pathology practitioners. (2) A form of undertaking shall make provision for and in relation to such matters as the Minister considers appropriate. ..." 16. Section 16C provides, inter alia, that where a medical practitioner gives an undertaking in writing in accordance with the appropriate form, subject to exceptions not here relevant, the Minister shall accept the undertaking. Sub-sections 16C (8) and (9) are as follows: "16C (8) An approved pathology practitioner may, at any time, terminate an undertaking given by him by serving, as prescribed, a notice of termination specifying a date of termination not earlier than 30 days after the day on which the notice is served. (9) For the purposes of this Act, an undertaking given by a person under this section comes into force when accepted by the Minister or on such earlier date (not being a date earlier than the date on which the undertaking was signed) as is fixed by the Minister and ceases to be in force if - (a) the undertaking is terminated by the person under sub-section (8); (b) the Minister's acceptance of the undertaking is revoked under section 106; or (c) ..." 17. Dr Peverill signed an undertaking on 27 July 1977 which was accepted by a delegate of the Minister on 1 August 1977, which was also the date on which the operation of the undertaking commenced. This undertaking was still in force at the time the services in question were rendered. Clause 2 of the undertaking defined the term "applicable pathology services" as pathology services in respect of which medical benefits were payable in accordance with the Act. Clause 3 of the undertaking was headed "Compliance with Act" and was as follows: "3 The practitioner will - (a) comply with the provisions in relation to applicable pathology services of the Act as from time to time amended and of the Regulations as for the time being in force; and (b) take appropriate action from time to time to ensure that persons who in the course of their employment carry out, or by arrangement perform, for or on behalf of the Practitioner duties or services in relation to applicable pathology services, in carrying out those duties or performing those services act in accordance with the said provisions of the Act and Regulations and in conformity with this undertaking." 18. Clause 9 of the undertaking was headed "Excessive Services" and stated: "The Practitioner will not render, or request to be rendered, an applicable pathology service that would constitute excessive services as referred to in Division 3 of Part V of the Act. (Sub-section 79 (1B) (a) of the Act provides that a reference to excessive services is a reference to professional services, being services in respect of which medical benefit has become or may become payable, that are not reasonably necessary for the adequate medical care of the patient concerned." 19. Clause 12 was headed "Termination of Undertaking" and was as follows: "12 This undertaking shall continue to be in force unless and until it ceases to be in force upon termination by the Practitioner under sub-section 16C (8) of the Act or upon such other event as causes an undertaking to cease to be in force by virtue of sub-section 16C (9)." 20. Sections 16A, 16B and 16C were repealed by sub-s. 15 (1) of the Health Legislation Amendment Act 1986 ("the 1986 Act") with effect from 1 August 1987. Sub-section 15 (2) of that Act provided that the amendment made by sub-s. (1) applied only in relation to pathology services rendered after the commencement of the section. Section 16A was re-enacted in similar form. Sections 16B and 16C were replaced by a new Part IIA headed "Special Provisions Relating to Pathology". Section 23DB (the successor to s. 16B) provides that the Minister may approve forms of undertaking to be given by persons who wish to become approved pathology practitioners. Section 23DC (the successor to s. 16C) provides for the giving and acceptance of approved pathology practitioner undertakings. Sub-paragraph 23DC (1) (c) provides that upon accepting the undertaking, the Minister must determine a period, being a period of not more than 12 months after the day on which the undertaking comes into force, for which the undertaking is to have effect. Section 23DD provides that the undertaking ceases to be in force upon the expiration of this period or, if the practitioner proffers a second undertaking, upon the date the practitioner is notified of the refusal of the second undertaking. 21. There is no specific provision in the 1986 Act dealing with the termination of the old s. 16C undertakings. However, the definition in sub-s. 3 (1) of "approved pathology practitioner" was amended to read: "a person in respect of whom there is in force an undertaking given by the person, and accepted by the Minister, under section 23DC;" 22. This means that pursuant to the new s. 16A, no Medicare benefit is payable in respect of services rendered by a practitioner until that practitioner has given the new s. 23DC undertaking. We were not shown any s. 23DC instrument signed by Dr Peverill, but on the appeal it was common ground that such an undertaking had been given by him and was still on foot. 23. We have already noted that the Committee recommended that the Minister revoke Dr Peverill's s. 16C undertaking, but that this was not acted upon by the Minister. In the letter to Dr Peverill dated 28 August 1992, enclosing the determination, the Minister stated that because the system for the giving and accepting of undertakings had changed since Dr Peverill's case was referred to the Committee, it was not possible effectively to revoke Dr Peverill's s. 16C undertaking. This assumed that s. 8 of the Acts Interpretation Act 1901 ("the Interpretation Act") did not operate to save the power of revocation. The amendments effected by the 1986 Act, which we have set out, may cover the field, so that the s. 16C undertaking, while not brought to an end by any provision, was left in limbo. 24. Part V of the Act is headed "Committees". Division 3 is headed "Medical Services Committees of Inquiry". At the relevant time, s. 79 (1B) read as follows: "79 (1B) In this Division - (a) a reference to excessive services is a reference to professional services, being services in respect of which medicare benefit has become or may become payable and which were not reasonably necessary for the adequate medical or dental care of the patient concerned; and (b) a reference to the initiation of a pathology service is a reference to the making of the decision by reason of which the service is rendered;" 25. Sub-section 79 (1B) was repealed and replaced by s. 22 of the 1986 Act, with effect 1 August 1987. The substituted provision excluded pathology services from the definition of "excessive services". The new sub-section was as follows: "79 (1B) A reference in this Division to excessive services is a reference to professional services (other than pathology services), being services in respect of which medicare benefit has become or may become payable and which were not reasonably necessary for the adequate medical or dental care of the patient concerned." (Emphasis supplied) 26. The sub-section was amended again in 1991 by s. 26 of the Health and Community Services Legislation Amendment Act 1991 ("the first 1991 Act") which deleted the words "(other than pathology services)" from the sub-section and so restored the previous situation. This amendment took effect on 24 December 1991 and so was in force when the Committee delivered its report on 29 May 1992. 27. Section 80 provides for the establishment in each State of a Medical Services Committee of Inquiry for that State. 28. We have set out s. 82 as it was at the time of the rendering of the services by Dr Peverill earlier in these reasons. After the reference to the Committee on 3 February 1987, s. 82 was repealed and replaced, with effect 1 August 1987, by s. 24 of the 1986 Act. Following amendment, s. 82 provided: "82 A Committee shall inquire into, and submit to the Minister its report and recommendations on, any matter referred to the Committee by the Minister, being a matter that - (a) is relevant to the operation or administration of this Act ...; and (b) arises out of relates to the rendering of a professional service (other than a pathology service), on or after 15 April 1977, in the State for which the Committee is established." 29. The words "(other than a pathology service)" were later removed by s. 27 of the first 1991 Act. 30. Section 93 provides that the committee may, with the approval of the Minister, engage as consultants to the Committee "persons having suitable qualifications and experience". In the present case, the Committee engaged three consultants. 31. Section 94 of the Act, at the time of the rendering of the services, was as follows: "94 Where, after consideration of a matter referred to a Committee by the Minister and of any documents that accompany the reference supplied by the Minister, it appears to the Committee that - (a) ... (b) a person may have failed to comply with an undertaking given by the person and accepted by the Minister under section 16C; (c) a practitioner may have rendered excessive services; (d) a person may have caused or permitted a practitioner employed by the person to render excessive services; (e) ... (f) a practitioner may have initiated excessive pathology services; (g) a person may have caused or permitted a practitioner employed by the person to initiate excessive pathology services; or (h) ... the Committee shall - (j) ... conduct a ... hearing into the matter ...". 32. By s. 25 of the 1986 Act, effective 6 June 1988, paras. (b), (f) and (g) were omitted. By s. 47 of the Community Services and Health Legislation Amendment (No. 2) Act 1990 ("the 1990 Act") effective 28 December 1990, references to the initiation of excessive pathology services were inserted so that paras. (c) and (d) now read: "(c) a practitioner may have initiated excessive pathology services or rendered excessive services; (d) a person may have caused or permitted a practitioner employed by the person to initiate excessive pathology services or render excessive services." 33. Section 95 of the Act, at the time of the rendering of the services, was as follows: "95 (1) A Committee shall - (a) if it proposes to hold a hearing into a matter in so far as the matter relates to a circumstance referred to in paragraph 94 (a) or (b) - cause to be given to the practitioner concerned; or (b) if he proposes to hold a hearing into a matter in so far as the matter relates to a circumstance referred to in paragraph 94 (c), (d), (e), (f) (g) or (h) - cause to be given to the person first referred to in that paragraph, notice in writing of the time and place of the proposed hearing at least ten days before the date of the proposed hearing. (2) A notice under sub-section (1) shall give particulars of the matter to which the hearing relates. (3) A notice under sub-section (1) may be served on a person either personally or by post." 34. Dr Peverill was sent a s. 95 notice on 16 April 1987. This notice simply reproduced the matters that were contained in the instrument of referral under s. 82 (b). The relevant portions of this referral are set out earlier in these reasons. 35. Section 104 of the Act is headed "Report by Committee". At the time of the rendering of the services, it was as follows: "104 After completion by a Committee of a hearing in relation to a matter, the Committee shall report to the Minister its opinion on the matter and, in a case where the Committee, in the report, expresses the opinion - (a) that a practitioner specified in the report has rendered excessive services; (b) that a person specified in the report has caused or permitted a practitioner - (i) who is employed by the person so specified; or (ii) ..., to render excessive services, (c) that a practitioner specified in the report has initiated excessive pathology services; (d) that a person specified in the report has caused or permitted a practitioner - (i) who is employed by the person so specified; or (ii) ..., to initiate excessive pathology services, the report shall identify the excessive services." Section 27 of the 1986 Act, effective 1 August 1987, removed paras. (c) and (d). By s. 47 of the 1990 Act, references to the initiation of excessive pathology services were added into paras. (a) and (b). 36. At the time of the rendering of the services, and so far as is relevant, s. 105 stated: "105 (1) ... (2) Where - (a) a Committee has, in a report under section 104, expressed the opinion that a practitioner has rendered excessive services or that a practitioner has initiated excessive pathology services, and has identified those services; and (b) a medicare benefit is payable, or has been paid, in respect of any of those services, the Committee may, in the report, make one or more of the following recommendations: (c) that the practitioner, being a practitioner other than a body corporate, be reprimanded; (ca) that the practitioner, being a practitioner other than a body corporate, be counselled; (d) in the case of the rendering of excessive pathology services - that the Minister revoke his acceptance of the undertaking given under section 16C by the practitioner; (e) where the medicare benefit is payable, but has not been paid, to the practitioner - that the medicare benefit or a specified part of the Medicare benefit cease to be payable; (f) where the medicare benefit has been paid to the practitioner or has been paid, or is payable, to another person, (including another practitioner or another person by whom the first-mentioned practitioner is employed) - that the amount of the Medicare benefit or a specified part of that amount be payable by the practitioner to the Commonwealth. (2A) Where - (a) a Committee has, in a report under section 104 - (i) expressed the opinion that a person has caused or permitted a practitioner - (A) who is employed by the first- mentioned person; or (B) who is employed by a body corporate of which the first- mentioned person is an officer, to render excessive services or to initiate excessive pathology services; and (ii) identified those services; and (b) a medicare benefit is payable, or has been paid, in respect of any of those services, the Committee may in the report make one or more of the following recommendations: (c) that the first-mentioned person, being a person other than a body corporate, be reprimanded; (d) that the first-mentioned person, being a person other than a body corporate, be counselled; (e) where the first-mentioned person, being an approved pathology practitioner, has caused or permitted a practitioner employed by the first-mentioned person to render excessive pathology services - that the Minister revoke his acceptance of the undertaking given under section 16C by the approved pathology practitioner; (f) where the medicare benefit is payable, but has not been paid, to the first-mentioned person - that the medicare benefit or a specified part of the medicare benefit cease to be payable; (g) where the medicare benefit has been paid to the first-mentioned person or has been paid or is payable to a person other than that first-mentioned person - that the amount of the medicare benefit or a specified part of that amount be payable by the first-mentioned person to the Commonwealth. (3) Where a Committee has, in a report under section 104, expressed the opinion that a practitioner has failed to comply with an undertaking given by him and accepted by the Minister under section 16C, the Committee may, in the report, make one or more of the following recommendations: (a) that the practitioner be reprimanded; (aa) that the practitioner be counselled; (b) that the Minister revoke his acceptance of the undertaking; (c) that where a medicare benefit is payable, but has not been paid, to the practitioner in respect of a pathology service and the Committee is of the opinion that the practitioner failed to comply with that undertaking in relation to that service, the medicare benefit or a specified part of the medicare benefit cease to be payable; (d) that, where a medicare benefit has been paid to the practitioner, or has been paid, or is payable, to another person, in respect of a pathology service and the Committee is of the opinion that the practitioner failed to comply with that undertaking in relation to that service, the amount of the medicare benefit or a specified part of that amount be payable by the practitioner to the Commonwealth. (4) ... (5) ..." 37. By s. 28 of the 1986 Act, references to excessive pathology services and s. 16C undertakings were removed. This was effected by deleting paras. (2) (d), (2A) (e) and sub-s. (3), and by deleting references to the initiation of excessive pathology services from paras. (2) (a) and (2A) (a) (i). Section 47 of the 1990 Act reinserted references to the initiation of excessive pathology services in paras. (2) (a) and (2A) (a). 38. Section 106, at the time of the rendering of the services, was as follows: "106 (1) Where a Committee makes a recommendation in accordance with sub-section 105 (2), (2A) or (3), the Minister may make a determination, in writing, in accordance with that recommendation. (2) Where the Minister makes a determination under sub-section (1), in relation to a person he shall serve on the person to whom the determination relates, either personally or by post, a notification in writing setting out the determination. (3) Where the Minister makes a determination under sub-section (1), then - (a) if no request for review of the determination under Division 3 of Part VA or application for judicial review of the determination under Division 4 of that Part is lodged within the period allowed for such a request or application, the determination takes effect at the expiration of that period; (b) if a request for review of the determination under Division 3 of Part VA or an application for judicial review of the determination under Division 4 of that Part is lodged within the period allowed for such a request or application - (i) in a case where the determin-ation is set aside on the review - subject to paragraph (c), the determination does not take effect; or (ii) in a case where the determin-ation is affirmed, or varied, on the review and no appeal against the decision on the review is brought by virtue of section 124A within the period allowed for such an appeal - the determination takes effect, or takes effect as so varied, at the expiration of that period; or (c) if an appeal against the decision on a review under Division 3 of Part VA or a judicial review under Division 4 of that Part is brought by virtue of section 124A within the period allowed for such an appeal, the determination does not have effect until the appeal, and any further appeal or appeals, are determined and, upon the determination of the appeal and any such further appeal or appeals, the determination takes effect or takes effect as varied or does not take effect, in accordance with the judgment or order on the appeal or further appeal or appeals." 39. Section 106AA of the Act at all relevant times provided that after a determination under s. 106 the Minister shall cause to be prepared a statement setting out particulars of the determination and the reasons for making the determination. The statement must be laid before each House of Parliament, and the Minister may, in addition, cause the statement to be published in the Gazette. 40. By s. 7 of the Health Insurance Amendment (No. 2) Act 1991 ("the second 1991 Act") with effect 20 November 1991, s. 106AB was inserted into the Act. That section provides that where a Committee makes a s. 104 report to the Minister expressing an opinion that a practitioner has initiated excessive pathology services or rendered excessive services, and making a para. 105 (2) (e) recommendation or a para. 105 (2) (f) recommendation, and the Minister makes a determination in accordance with that recommendation under s. 106, the practitioner is liable to pay to the Commonwealth by way of penalty an amount equal to the amount of Medicare benefit that ceased to be payable to the practitioner or is payable by the practitioner to the Commonwealth, as the case may be. A similar provision is made in the second 1991 Act for recommendations under paras. 105 (2A) (f) and 105 (2A) (g). 41. A number of provisions set out above refer to the initiation of an "excessive pathology service". At the time the services were rendered the Act did not contain a definition for such a phrase. This was inserted into s. 3 (the definition section) by sub-s. 4 (1) of the 1986 Act, with effect from 1 August 1987. The new definition is as follows: "'excessive pathology service' means a pathology service - (a) in respect of which medicare benefit has become or may become payable; and (b) that is not reasonably necessary for the adequate medical or dental care of the patient concerned." 42. It will be noted that during the period between the commencement by the Committee of its inquiry and the delivery of its recommendations, pathology services first were removed from the definition of "excessive services" and from the ambit of the operation of the other sections determining the functions and powers of the Committee, and then were reinstated. It was not submitted that these changes affected in any way the validity of the Committee's actions or recommendations. Indeed, counsel for Dr Peverill conceded or suggested that he was not assisted by these amendments. The respondents may, in any event, have gained assistance from s. 8 of the Interpretation Act. We have set out the amendments because they assist in interpreting the meaning of the term "excessive services". 43. Finally, we should refer to s. 129AD. This has been in the Act since its insertion by s. 50 of the Health Insurance Amendment Act 1977 but has been amended from time to time. It provides for the recovery as a debt of an amount specified by a determination under such a provision as s. 106 as being payable to the Commonwealth. Procedural History 44. The present proceeding has had a somewhat complicated history. The matters leading to the commencement of the inquiry by the Committee have been set out earlier in these reasons. After the commencement of the inquiry, on 27 March 1988, Dr Peverill brought an application to this Court under s. 39B of the Judiciary Act 1903 seeking a rule nisi for prohibition against the Minister and the Committee members. This step was apparently taken after the Committee indicated that there was no dispute that all of the services in question had been requested of Dr Peverill, and that the only remaining issue was whether the performance of those services amounted to the rendering of excessive services within the meaning of the Act. 45. The Judge who heard the application (Einfeld J) delivered his reasons on 21 October 1988. In these reasons his Honour states the nature of the proceeding as follows: "The applicant brings this case in a number of alternative forms. He has foregone an original request for a rule nisi for prohibition in the sense of seeking a primary hearing before a Full Court. He now seeks a series of declarations and various forms of judicial review pursuant to the Judicial Review Act. For the present, I do not propose to pass on any one or more of these forms of relief. After these views are made available, I will hear counsel further on what flows from my conclusions. Accordingly, I directed that the parties should agree on the fundamental issues or questions to be considered. They have agreed on three out of four questions. The three agreed questions are as follows: 1. Whether on the true construction of the Health Insurance Act 1973, a pathology test can be an excessive service, as defined in section 79 (1B) (a) of the Act, if it has been requested by a medical practitioner under section 16A (1) (a) of the Act. 2. Whether, on the true construction of the undertaking given by the applicant, the performance by the applicant of a pathology test which had been requested by a medical practitioner under section 16A (1) (a) of the Act could be a breach of that undertaking if the test was not in fact reasonably necessary for the adequate medical care of the patient concerned. 3. Whether the Minister can, under section 82 (b) of the Act, refer to a Medical Services Committee of Inquiry the question of whether certain specified pathology services were not reasonably necessary for the adequate medical care of the patient concerned. ... As part of the relief sought is declaratory, and as in any event what is being sought is discretionary relief in relation to an administrative proceeding that is part heard, one possible conclusion raised in argument is that it is inappropriate for the Court to intervene at this stage. There is much authority to this effect, especially in relation to committal proceedings and other administrative hearings. However, the proceedings of this Committee of Inquiry have already been interrupted for this hearing, and the parties have jointly asked the Court to rule on these issues. In particular, counsel for the respondents, who might have taken the point, has indicated that his clients will welcome the Court's ruling on the subject. I can understand this attitude in this case, and I will act in accordance with it, although I must say that there are reasons, including considerable persuasive authority, which might otherwise lead a first instance Court in the other direction. Apart from consent, one weighty matter supportive of intervention at this stage, certainly for appropriate rulings of law, is the common ground that the hearing is likely to be substantially lengthened and very much more expensive if the Court does not rule at this time. I will therefore address and rule on the three questions posed." 46. At no stage does his Honour identify any decision the subject of judicial review. His Honour proceeded to answer the three questions in the negative. 47. On 13 February 1989, his Honour made a number of declarations, including a declaration that: "On the true construction of the Health Insurance Act 1973 as it stood in 1977, the undertaking given to the first respondent by the applicant on 27 July 1977 with effect from 1 August 1977 does not empower a Medical Services Committee of Inquiry constituted under the Act to report on whether a pathology test is an excessive service within the meaning of the Act if the patient was referred to the applicant to perform the test, even if the referring practitioner erred in determining that the test was necessary for, or reasonably necessary for the adequate medical care of, the patient." 48. His Honour also declared that the instrument of referral of 3 February 1987 was invalid, to the extent to which it purported to refer to the Committee the question whether certain specified pathology services requested of the applicant by other medical practitioners and conducted by him in pursuance of those requests were excessive services, and whether certain specified pathology services complied with or were in breach of his undertaking because they are alleged to be excessive services within the meaning of the Act. 49. The Minister appealed and the decision of the Full Court was delivered on 2 May 1991. It is reported, (1991) 29 FCR 262. We shall refer to this decision in greater detail later in these reasons. It is sufficient for present purposes to note that the Full Court relied upon Tiong v Minister for Community Services and Health (1990) 93 ALR 308, a Full Court decision given on 4 May 1990, that is after the decision of Einfeld J. Their Honours stated (at 276) that the decision in Tiong was authority for, inter alia, two propositions: "(I)n the case of an allegation that an unnecessary service has been rendered, it is not a complete answer that the service was rendered at the request of another practitioner. Although a request is a very material matter, which under normal circumstances may be acted upon without further inquiry, cases may occur in which even a requested practitioner may be found to have rendered excessive services. However, ... such cases will be confined to those involving some 'personal fault', to use the term of Davies J and Spender J (in Tiong), or lack of innocence, to adopt the concept of Burchett J." 50. It followed that the Full Court was of the view that the three questions answered by the primary Judge in the immediate case should have been answered affirmatively, rather than negatively. The Court allowed the appeal and set aside the declarations made by Einfeld J, but did not substitute an order giving effect to these conclusions by an appropriate declaration. The Full Court took the view that there would be no utility in making a declaration in terms sought by the respondent, saying (at 281): "The circumstances under which a pathologist may be found to have rendered an excessive service, despite a request from another practitioner, will be clear to the Committee from the terms of Tiong and these reasons." 51. Rather, having set aside the declarations and orders made by Einfeld J, the Full Court ordered that the application be dismissed. 52. Following this appeal, the Committee recommenced its inquiry, and delivered its report to the Minister on 29 May 1992. The Report of the Committee 53. The Committee found that, of the 7 laboratories operated by Dr Peverill, 6 bulk-billed 99% of the services requested by practitioners, and the seventh laboratory bulk-billed approximately 80%. Dr Peverill supplied all referring practitioners with a kit which included a "Data Book". Dr Peverill gave oral evidence and was cross-examined. He was asked if he could tell the Committee how one could become a referring practitioner. Dr Peverill replied: "You'd have to ring up, and if he wanted to become one of my doctors he would ring up and say I'd like to use your service and we would send him round a kit and in that kit he would get a Data Book, a Request Book, a series of hysto bottles, pap smears etc. He would talk to my (public relations) girl, she'd explain how we do things, ask any questions and say if there's any problems, ring us up about it." 54. Practitioners wishing to use Dr Peverill's pathology services would fill out a pre-printed pathology request/assignment form. This form would be completed using terms and abbreviations which were explained in the Data Book. The Data Book indicated that by using these terms the practitioners were requesting in many cases a group of tests set out in the Data Book. For example, when "hepatitis studies" was selected, the specimen from the patient would be subjected to 10 separate hepatitis tests. The Committee noted that Dr Peverill indicated that if a test within a particular group was not required by the practitioner, the practitioner would have specifically indicated this on the request form. 55. The two particular areas of concern for the Committee were the automatic coupling of a "Glucose Tolerance Test" with an "Insulin Test", and the routine performance of a large number of viral tests when the item "Viral Studies" was selected. Nothing of significance appeared next to the term "Glucose Tolerance Test" in the Data Book. However, next to the term "Insulin" appeared the words "Routinely run on Glucose Tolerance Test samples". Beside the term "Viral Studies" appeared the words "complete screen reported". The Committee did not, in its report, set out the tests that were performed under this latter request. However, the evidence indicates that the tests routinely performed were rubella, glandular fever, viral hepatitis, Ross River fever, herpes, and, in the Townsville laboratory only, toxoplasma. 56. The Committee engaged three consultants who gave evidence. Dr Peverill called two witnesses, one of whom was a partner of his in Townsville, and submitted five statutory declarations. 57. The Committee referred to the Full Court decision of Peverill, where it was stated that the Committee must not only find that the rendered services were not reasonably necessary for the adequate medical care of the patient, but that the practitioner exhibited "personal fault" in performing those services. 58. As to the first element, the Committee's findings with respect to the glucose tolerance test (GTT) and insulin tests are contained in paras. 3B.1.3 and 3B.1.4 which are as follows: "3B.1.3 The Committee acknowledges that during the time of the Reference it was thought by some that the serum insulin levels were or could have been of value in the diagnosis and/or management of diabetes mellitus and that it may not have been unreasonable for the insulin levels to be measured with GTT as a research tool in some institutions. However, the Committee's opinion is that it was not reasonable for insulin levels to be measured as a routine with GTT in clinical practice. 3B.1.4 In considering the evidence the Committee decided that a serum insulin estimation was not reasonably necessary for the adequate medical care of the patient where: (i) the patient does not have diabetes, that is, when the patient has a normal glucose tolerance test as did the majority of patients, or a mildly impaired glucose tolerance test. (ii) The patient has diabetes controlled by conventional management." 59. The Committee's findings with respect to the viral study tests were as follows: "3B.3.1 The Committee formed the opinion that it was not reasonably necessary for the adequate medical care of every patient for a routine fixed combination of tests as listed in Dr Peverill's Data Book to be rendered by Dr Peverill irrespective of the clinical information supplied by the referring practitioner. Indeed, the clinical information supplied was more often than not inadequate for any reasonable decision to be made about any of the tests performed. The Committee cannot concede that every test was indicated in every patient on every occasion. ... 3B.3.3 In certain cases specific tests were implied to have been requested e.g. in a patient where the clinical details were 'recent contact with Rubella'. Such clinical detail appears to be very explicit and implies that a fairly specific test was requested. However even in this situation where such reasonable clinical details were supplied, carrying the implication that a specific test was required, the same fixed combination of tests was performed by Dr Peverill. ... 3B.3.5 On deciding which services were not reasonably necessary for the adequate medical care of the patient the Committee determined that where the request was for viral studies or viral antibodies without any further specific information, or with a few symptoms and signs of generalised viral illness the referring practitioner was concerned about an acute viral illness and not about the immune status of the patient. In considering the tests which were necessary in this situation, the Committee determined that it would be reasonable to restrict the test to those which would diagnose an acute viral illness; and those tests for immune status in many patients would not be reasonably necessary for the adequate medical care of the patient. 3B.3.6 In forming its opinion the Committee considered the evidence for each patient. The following information was used as the general basis for its decision on individual patients. Tests not falling within these guidelines generally would not be reasonably necessary for the adequate medical care of the individual patients." 60. There followed a list of the various types of viral tests that were performed by Dr Peverill with an indication by the Committee of which specific tests would be appropriate. For example, beside the heading "Hepatitis Virus Markers" appeared: "In the acute phase the only tests that would be medically necessary would be the hepatitis A IgM antibody and the Hepatitis B surface antigen. If both tests are negative all further tests would not be medically necessary. The other hepatitis tests would be appropriate only when trying to determine the immune status, previous exposure or carrier status of the patient." 61. The Committee also made findings in relation to personal fault. These findings were: "3A.6 In forming its opinion the Committee was mindful of the fact that Dr Peverill is a specialist in pathology and not a laboratory technician. As such Dr Peverill had a personal obligation to use his professional expertise in: . Deciding on the reasonable necessity of requested tests for individual patients; . Deciding on the appropriate grouping of tests recommended to his referring practitioners; and . The need to consult the referring practitioner when a request was ambiguous or of doubtful relevance. 3A.7 The vast majority of requests were received from general practitioners who would be likely, in many circumstances, to be dependent on Dr Peverill's expertise to inform them of current standard practices. It was apparent that Dr Peverill had instituted a system whereby fixed combinations of tests were performed on many different patients independent of their clinical state or geographic location. In providing these fixed combinations of tests Dr Peverill claimed that the referring practitioners could, if they wanted, delete specific tests. However, the Committee noted that there was no mention of the delete option in his Data Book; nor was the delete option exercised in any of the requests within the patients in the Reference. This confirms the Committee's view that this delete option is one unlikely to be exercised by referring practitioners and that such a system is likely to lend itself to the rendering of services that are not reasonably necessary for the adequate medical care of the patient." 62. The Committee then made two specific findings of personal fault as follows: "3A.8 The Committee believes that Dr Peverill's Data Book, by its design, led referring practitioners to request fixed combinations of tests some of which may not have been reasonably necessary for the adequate medical care of the patient, e.g. insulin estimations routinely with GTT, and broad grouping of viral tests. The Committee was of the opinion that Dr Peverill exhibited personal fault in the design of his Data Book. 3A.8.1 Because of this system Dr Peverill had an additional professional responsibility in assessing the reasonable necessity of many requested tests, if necessary by contacting the referring practitioner. The Committee questioned Dr Peverill about the steps he took in these circumstances and there was no evidence that referring practitioners had been contacted with respect to any of the patients in the Reference. The Committee was also of the opinion that Dr Peverill exhibited personal fault in not contacting referring practitioners in appropriate circumstances to decide what tests were reasonably necessary." 63. These findings were elaborated by the Committee as follows: "3A.9 When forming its opinion on whether a service was not reasonably necessary for the adequate medical care of each patient the Committee considered all the relevant data relating to the patient and the environment of the practice. In some cases it was difficult for the Committee to form an opinion where there was limited clinical information on the patient. However, even in those patients where there were virtually no clinical details a fixed combination of tests was always performed when clearly many of those tests were not medically necessary. For example where a patient may have had acute hepatitis, the tests necessary in the first instance are an Igm antibody to hepatitis A and hepatitis B surface antigen; yet in every case three additional hepatitis tests were performed. ... 3B.3.2 While appreciating the problem that Dr Peverill may have had with limited clinical information the Committee is of the view that in such circumstances, as a specialist in pathology, he must contact the referring practitioner for more details to determine which of his combination of tests was and was not reasonably necessary for that particular patient." 64. With respect to the insulin test in particular, the Committee stated: "3B.1.2 ... After questioning Dr Peverill the Committee accepted Dr Peverill's position that insulation estimations were requested. However the Committee was of the opinion that such requests for fixed combinations of tests placed an extra onus on Dr Peverill to decide if in each case the insulin estimations were reasonably necessary; and to contact the referring practitioner where appropriate. The Committee formed the opinion that Dr Peverill was responsible for serum insulins being ordered as a routine and thereby exhibited personal fault." The Basis of the Appeal 65. The application to this Court and the notice of appeal identify a multitude of alleged errors in the reasons of the Committee and, subsequently, in those of the primary Judge upon judicial review. During the course of submissions, however, counsel for the appellant said that he relied upon four central propositions. The first is that, the services performed by Dr Peverill being requested by other practitioners, the performance of those services could not amount to over-servicing. The second proposition is that Dr Peverill's actions were consistent with an accepted medical standard and thus it could not be said that they were "not reasonably necessary for the adequate medical ... care of the patient" within the meaning of sub-s. 79 (1B). The third matter is a procedural fairness point. It is said that the validity of the hearing was vitiated by the failure to give Dr Peverill notice of any matter said to constitute personal fault on his behalf. It also is said that this amounted to a breach of the requirement of sub-s. 95 (2) as to the giving of notice. 66. The fourth point evokes Wednesbury unreasonableness. The submission also is put in terms that the sanction imposed on Dr Peverill is "disproportionately severe". However, as Dawson J has explained in Cunliffe v Commonwealth of Australia (1994) 124 ALR 120 at 177, the notion of proportionality has its origin in European systems with a different basic structure for administrative review to that which has developed in common law countries. See also Boyron "Proportionality in English Administrative Law: A Faulty Translation?", (1992) 12 Ox JLS 237. The fourth point is best approached as turning upon the Wednesbury doctrine as devised in England and developed in Australia. 67. The first two points are somewhat interrelated. They raise the issue of what type of conduct is required before a specialist pathologist can be said to have rendered excessive services. We have set out the relevant provisions of Part V Division 3 earlier in these reasons. These provisions indicate that there are two separate objectives that may be pursued utilising the procedures set out in the Division. The first is the recovery of the amount of the Medicare benefit payable or paid in respect of the excessive services (see paras. 105 (2) (e) and (f)). The second is the disciplining of the practitioner (see paras. 105 (2) (c), (ca) and (d)). Both of these are dependent upon a finding that an excessive service has been rendered or an excessive pathology service has been initiated (see s. 104, sub-s. 105 (2) (a)). 68. We have already pointed out that at the time the services in question were performed the Act did not contain a definition of "excessive pathology service". This was inserted by the 1986 Act with effect from 1 August 1987 in terms which mirrored the definition of "excessive services" in para. 79 (1B) (a), namely, services which were "not reasonably necessary for the adequate medical ... care of the patient concerned". 69. At first sight, the definition of "excessive services" would appear to suggest an objective test ("not reasonably necessary"). On this construction, a practitioner may be held to have rendered excessive services where the facts that indicated that the services were not reasonably necessary were not known to the practitioner. This may be so particularly in the case of a pathologist, where the patient and thus the symptoms have not been seen by the practitioner performing the service. The innocence or otherwise of the practitioner might then be a matter which could be taken into account by the Minister in considering whether to exercise the discretion under s. 105 to discipline the practitioner, or indeed to require the repayment of the Medicare benefit. 70. The position is complicated in the case of pathologists by the separate provisions in respect of the initiation of excessive pathology services. It may be that with respect to the one service both the referring practitioner and the pathologist have initiated and rendered, respectively, the one excessive service. It may also follow that both the referring practitioner and the pathologist are liable to repay the Medicare benefit under para. 105 (2) (f). In the case of the referring practitioner, this is because para. (f) includes the situation where the Medicare benefit has been paid to another person, "including another practitioner", and provides that the amount of the Medicare benefit is payable by the referring practitioner to the Commonwealth. 71. However, the provisions of Part V Division 3 previously may have been interpreted in the Full Court in a different manner. In Tiong supra a question arose whether a radiologist had performed excessive services. The Committee had found that an ear, nose and throat specialist had ordered excessive radiological services to be performed by a radiologist and that the radiologist had only rendered the radiological services she had been asked to render. The Committee noted that no provision existed in the Act with respect to the initiation of radiological services. (We have referred to the different position as regards pathology services.) Since there was no doubt that the radiologist had performed the radiological services, the Committee made a finding that the radiologist had rendered excessive services and recommended that she be counselled and be required to repay a sum to the Commonwealth. Davies J stated (90 ALR at 314), that the reasons of the Committee read as a whole proceeded on the basis that the services requested by the ear, nose and throat specialist were unnecessary, but that the radiologist was responsible for them simply because she had performed the service. His Honour later said (at 315): "Medical services are not excessive for the purpose of the (Act) unless they constitute unnecessary servicing by the medical practitioner at the expense of the health system. The terms of s. 105 of the (Act), which refer to a reprimand, to counselling and to a decision that the practitioner repay certain fees received, necessarily imply a disciplinary proceeding. They require personal fault on the part of the practitioner. This issue must be examined having regard to the facts which were known or available to the practitioner and must take into account the practitioner's perception of the patient's condition and care required. Regard should also be had to acceptable practice in the medical profession. The words 'reasonably necessary' in the definition of 'excessive services' refer to services which are reasonably appropriate ... Thus, if a practitioner rendered services which, in his view, were not reasonably appropriate for the adequate medical care of the patient, but did so, e.g. for the purpose of enhancing his own income, the services rendered would not be reasonably necessary for the care of the patient. On the other hand, if the practitioner performed a service which, in his view, was appropriate for the adequate care of the patient concerned, his belief would be relevant as to whether the service was not reasonably necessary but it would not determine the matter. The committee, the Minister and the Review Tribunal each have the function of making up its or his own mind on the issue as to whether the service was reasonably necessary." 72. At 318, Spender J said: "It seems to me inherent in (sub-s. 105 (2)) that personal fault on the part of the practitioner is necessary. The scheme of the Act is not to make a practitioner vicariously liable in respect of services which have been ordered by another medical practitioner, which services are, on the material available to the ordering practitioner, not reasonably necessary for the adequate medical care of the patient. Sections 104 and 105 and the determinations by the Minister under s. 106 are all directed at the practitioner who rendered excessive services and not at a practitioner who ordered or requested those services to be provided. Whether a practitioner, in rendering a specific service, has rendered excessive service is to be judged from the viewpoint of the practitioner rendering the service." 73. Later, at 319, he noted that the Review Tribunal did not address the question of whether there was personal fault in the radiologist's conduct. He then continued, at 320: "In my opinion, the Review Tribunal failed to apply the true test on the issue of whether the service was reasonably necessary, which is whether, viewed from the position of the practitioner rendering the service, the service was reasonably necessary for the adequate medical care of the patient." 74. Burchett J, at 320, agreed with the reasons of Davies J that the conclusion of the Review Tribunal was vitiated by an error of law. He said: "That conclusion embraced the proposition that a radiologist, acting upon an apparently normal request for radiology services on behalf of a patient, would be guilty of providing 'excessive services' within the meaning of s. 79 (1B) of the (Act) if the ear nose and throat specialist, who requested the provision of the service to enable him to diagnose and treat the patient's condition, lacked sufficient justification for making his request. I cannot accept that the legislature intended to heap upon an entirely innocent specialist the onerous consequences of a finding of over-servicing upon any such basis. The criterion contained in s. 79 (1B) is whether a professional service is 'not reasonably necessary for the adequate medical or dental care of the patient concerned'. The necessity for the provision of a service must be considered from the viewpoint of the provider of the service. The sub-section is concerned with his actions, and it would be incongruous to evaluate them from the viewpoint of someone differently placed and possessed of different information. What is necessary to be done by a consultant, asked to perform a test or furnish an opinion on a patient currently under treatment directed by someone else, may be quite different from what would be necessary if the consultant were the first doctor seen by a previously untreated patient. For a specialist requested to carry out a test, one thing may be necessary - to carry out that test. It will be reasonably necessary to do so for the adequate medical care of the patient, so far as he is concerned, if the request comes from an appropriate practitioner and is not on its face an inappropriate request. In a profession divided into specialties, any other approach would disrupt the activities which are intended to work together to effect diagnosis and cure." 75. Subsequently, there was the decision of the Full Court in Peverill supra. We have already described circumstances giving rise to this decision. There may be much to be said for the view that the proceeding, as it went to trial and on appeal from the declarations made by the primary Judge, was directed to answering abstract questions, in the sense criticised by the High Court in Ainsworth v Criminal Justice Commission (1992) 175 CLR 564 at 581-582. Further, the statements of the Full Court may, strictly, have been made as obiter dicta. 76. The Full Court in its judgment set out various passages of Tiong and then stated (29 FCR 262 at 276): "There are some differences between the various judgments in Tiong. But, as we read those judgments, all of their Honours would support four propositions. First, the question whether particular services are excessive, within the meaning of s. 79 (1B), is a matter which must be determined having regard to the information available to the practitioner whose conduct - whether initiation or rendering of services - is under examination. Secondly, in determining that question, the view of that practitioner as to necessity will be relevant but not decisive. The view of the practitioner will not be decisive because the question is an objective one and not dependent upon the personal view of the particular practitioner. Thirdly, in the case of an allegation that an unnecessary service has been rendered, it is not a complete answer that the service was rendered at the request of another practitioner. Although a request is a very material matter, which under normal circumstances may be acted upon without further inquiry, cases may occur in which even a requested practitioner may be found to have rendered excessive services. However, and this is the final proposition, such cases will be confined to those involving some 'personal fault', to use the term of Davies J and Spender J, or lack of innocence, to adopt the concept of Burchett J." 77. Their Honours later said (at 277-278): "(T)he Committee would be obliged to take into account Dr Peverill's knowledge as to relevant facts. This would include his knowledge that the patient's general practitioner had requested the service; but this would not necessarily be determinative of the matter. If the Committee found that Dr Peverill believed that the general practitioner's request was inappropriate or that he had reason to believe that the requesting practitioner did not genuinely or reasonably consider the requested service, or all of the requested services, to be necessary, or that Dr Peverill knew that there was doubt about one of these matter but deliberately refrained from inquiry, it would be entitled to find excessive servicing and to make appropriate recommendations under s. 105. Any of the assumed situations would involve 'personal fault' in the rendering of the service. Of course, the existence of 'personal fault' would not itself be enough; there must be a conclusion that the rendered services were not reasonably necessary for the adequate medical care of the patient." 78. Some of these reformulations of the judgments in Tiong may extend beyond what was held in that case. In particular, the last passage quoted, which seems to indicate a two step test, in our view, is not found in Tiong and is not supported by the terms of the Act. In Tiong, the issue of "personal fault" was relevant in determining the primary question of whether a service was not reasonably necessary for the adequate medical care of the patient. 79. Such a question is to be determined in the light of the facts known to the practitioner concerned. In dealing with the issues of construction of the statute, regard should be paid to the objectives sought to be pursued by Division 3, and the possibility that a finding of excessive servicing may expose a practitioner to various penalties. If that be done, then, in answering the question of whether excessive services have been rendered, it is difficult to maintain that regard should be had to facts which were not known and ought not reasonably to have been known to the practitioner. For example, if it is subsequently revealed by further research that a particular procedure is useless, it could not be said that all practitioners who performed the treatment at a time when it was generally thought to be efficacious have performed excessive services. Likewise, it may be that a specialist is unaware, reasonably in the circumstances, of facts concerning a patient which are known to the referring practitioner. 80. It is in this context that the concept of "personal fault" in the judgments in Tiong is to be understood. Tiong acknowledges that the terms and context of the provisions of Division 3 dictate that a practitioner who could not reasonably have known certain matters is not caught by the Division. 81. We have already spoken of the twin objectives apparent from the face of Division 3. The conclusion expressed above is consistent with those provisions of the Division directed towards the disciplining of the practitioner. With respect to the recovery of Medicare benefits payable or paid in respect of excessive services, the objective may still be satisfied under this construction by the application of para. 105 (2) (f). In the case of an excessive service requested by a referring practitioner, and unwittingly provided by a pathologist, the amount of the Medicare benefit may be recoverable from the referring practitioner. 82. It also should be noted that by Part 4 of the Health, Housing and Community Services Legislation Amendment Act 1992, with effect 30 June 1992, the initiation of excessive radiology services by referring practitioners is covered by the insertion of the words "or excessive diagnostic imaging services" after the words "excessive pathology services" in relevant sections in Division 3. Radiology is another specialty where excessive services may be unwittingly performed (cf. Tiong). Too much should not be made of the later statute as an aid in interpretation of what went before it: Interlego AG v Croner Trading Pty Ltd (1992) 39 FCR 348 at 382. However, the insertion of these provisions dealing with the initiation of services indicates some legislative recognition that it may be more difficult to recover Medicare benefits in respect of excessive services from radiologists and pathologists. 83. In the present case, the Committee made specific findings that a number of the tests performed by Dr Peverill were not medically necessary. We have set out the reasons for these findings earlier in these reasons. In the case of the insulin tests, the Committee stated that the measurement of insulin levels when a glucose tolerance test was requested would be necessary only in certain limited circumstances. In the case of viral studies, the Committee set out criteria which it used to determine whether the tests performed were necessary having regard to the clinical details supplied by the referring practitioner. 84. The Committee also made findings of personal fault. Unlike Tiong, this was not a case where the finding was merely that the specialist had automatically performed tests specifically requested by the referring practitioner. Here, the Committee found that Dr Peverill, by the design of his Data Book, "had instituted a system whereby fixed combinations of tests were performed on many different patients independent of their clinical state or geographic location" and that "such a system is likely to lend itself to the rendering of services that are not reasonably necessary for the adequate medical care of the patient" (para. 3A.7). The Committee further found that, because Dr Peverill had set up a system that was likely to lead to the requesting of unnecessary services, he had an additional professional responsibility either (i) to examine the clinical details supplied by the referring practitioner to assess whether the requested tests were in fact reasonably necessary, or (ii) where the clinical information supplied was inadequate, to contact the referring practitioner to find out further information (paras. 3A.8.1, 3B.1.2 and 3B.3.2). The Committee found that Dr Peverill failed to satisfy this obligation. 85. Thus, there is a finding that a practitioner has devised a system whereby he ought to have known that unnecessary tests would be requested, a finding that unnecessary tests were in fact performed, and a finding that the practitioner failed to use information available to him or failed to seek further information to determine whether the tests requested were in fact medically necessary. Upon an application for judicial review, it cannot be said to have been erroneous for the decision maker to conclude from these findings that the practitioner had rendered excessive services within the meaning of Division 3. 86. The second ground advanced by the appellant challenged an earlier finding of the Committee, namely that the services in question were medically unnecessary. This was said to be erroneous because there was evidence that Dr Peverill's practices were consistent with an accepted medical standard. Counsel for Dr Peverill pointed to evidence brought on his behalf and to some of the evidence given by practitioners retained by the Committee as indicating the existence of legitimate schools of thought which supported the reasonableness of the tests conducted by Dr Peverill. 87. This point may be dealt with quite briefly. Sub-section 80 (2) of the Act provides that each State Committee shall consist of five medical practitioners. Sub-section 80 (3) provides that the members of each Committee shall be appointed by the Minister and four of them shall be so appointed after consultation by the Minister with the Australian Medical Association. We have already noted s. 93 of the Act, which provides that the Chairman of the Committee may, on behalf of the Commonwealth, engage consultants to the Committee. The task of deciding whether an excessive service has been rendered thus has been entrusted by the Parliament to a committee comprising a number of medical practitioners. Such a body properly may rely upon its own experience and expertise: Minister for Health v Thomson (1985) 8 FCR 213 at 217, 224. Further, the statute provides for expert evidence to be taken. 88. One of the functions which the Committee had to perform in determining the wider question of whether excessive services have been rendered was to determine objectively whether the services were necessary for the adequate medical care of the patient. This process of its nature may involve the weighing up of conflicting bodies of evidence. It cannot be said that if the conduct of the medical practitioner concerned accords with the practices of a number of other practitioners, the Committee thereby is precluded from making a finding that excessive services have been rendered. 89. In the present case, the Committee has made a number of findings regarding the necessity of certain procedures. A court would be slow, particularly upon judicial review, to interfere, unless, perhaps, it was shown the findings were quite unsupported by evidence: Curragh Queensland Mining Ltd v Daniel (1992) 34 FCR 212 at 219-224. Even then, weight would have to be given to reliance by the Committee upon the expertise of its members. Furthermore, the reasons of the Committee reveal that the Committee acted cautiously and carefully in making the findings with respect to the necessity of procedures. In para. 3B.1.3, the Committee acknowledges that during 1986 it was thought by some that the measurement of insulin levels was of value in the diagnosis and/or management of diabetes mellitus and that it may not have been unreasonable for insulin levels to be measured with GTT "as a research tool in some institutions". However, the Committee went on to say that it was not reasonable for such tests to be routinely run in clinical practice. Such an approach does not reveal any reviewable error in the treatment of competing bodies of evidence. 90. One qualification may concern testing for rubella. Counsel for Dr Peverill submitted that all of the evidence before the Committee supported Dr Peverill's approach to rubella testing and thus the Committee's finding in this respect was not based upon any evidence. The guideline adopted by the Committee in its report appears in para. 3B.3.6 as follows: "Rubella Virus - In the acute phase the only antibody which would assist in the management of the patient is the rubella IgM. The rubella IgG antibody is of use only in determining the immune status of the patient. Both tests may be clinically indicated in restricted circumstances." 91. Counsel for Dr Peverill points to the evidence of the Committee's retained expert, Dr Faoagali, as supporting the approach of Dr Peverill. In fact, her evidence is somewhat ambivalent. During the hearing, the following exchange occurred: "Dr Mitchell: Where there is an IgM test available and someone presents with an acute illness, let's say they have a rash and an arthralgia where, let's just say rubella might be a possibility. Do you think that both the IgG and IgM antibodies are worth looking at or is it sufficient just to do, look for IgM in that clinical setting? Dr Faoagali: I really think that both tests need to be done. Dr Mitchell: Can you tell us why please? Dr Faoagali: Because of the, the, no test is infallible. Now occasionally you can get IgG and IgM competing for each other and so you will then have a blocking effect and you will get a negative IgM but your IgG will be positive. And so you may, if you only do the IgM you may say this patient can't possibly have rubella they've got no IgM and yet if you've done the IgG it is positive and you can then say well that's not true there are some antibodies around and this may be very important prognostically if the woman's a young girl, if the person's a young girl or pregnant or ... Dr Mitchell: And would that apply generally to, to all viral infections where there is an IgM, an IgG assay available? Dr Faoagali: Yes. I really believe that one needs to do a pattern of tests to get the pattern that is, appears. Now this, I think that you can often get, if you're screening for things you can often get away with one and then if you get a positive you then go on and do the others, you don't need to screen with everything. Dr Mitchell: I guess, therefore where you have only one bite of the cherry, if you like, you would, you would do the lot, but the lot, you'd do IgM and IgG. Dr Faoagali: Yes." 92. It should be noted that Dr Faoagali appeared to give context to her comments by explaining that both tests should be done because it may be very important prognostically. Junior counsel for the respondents points out that the Committee only disallowed the IgG test when it was performed on men or on women of non child bearing age. In these circumstances, it cannot be said that the Committee has disregarded the evidence presented to it. 93. The third broad ground of appeal against the decision of the primary Judge is based on what is said to be the failure by the Committee to give Dr Peverill notice of any matter said to constitute personal fault on his behalf. It is also alleged that this amounted to a breach of sub-s. 95 (2). We shall deal with the latter point first. Sub-section 95 (1) requires the Committee to give the practitioner being investigated at least ten days' notice in writing of the hearing. Sub-section (2) provides that a notice under sub-s. (1) shall give particulars of the matter to which the hearing relates. Dr Peverill's s. 95 notice had annexed to it details of no less than 251 particular services rendered to specific patients and stated that the Committee intended to hold an inquiry into whether each of the services was an excessive service within the meaning of s. 79 (1B) (a) of the Act. 94. We would not accept that sub-s. 95 (2) required the giving of any additional information or notice. Dr Peverill was informed of the services which the Committee was investigating. The sub-section does not require the Committee to provide the minutiae of possible matters that could lead it to a conclusion that excessive services had been rendered. Indeed, it clearly would be unable to do so at the stage of the giving of the s. 95 notice. 95. We turn then to the other ground of complaint concerning procedural unfairness. In substance, the submission is that Dr Peverill was not given an opportunity to address the Committee on the matters that the Committee ultimately found constituted personal fault by him, namely, the design of a system based on the Data Book which encouraged over-servicing and a subsequent failure by Dr Peverill to check whether requested services were reasonably necessary. 96. An examination of the transcript before the hearing shows that this submission is without foundation. Early on in the proceedings, the following exchange occurred: "Dr Peverill: No, well the glucose tolerance test that we carry out for our doctors over this period included the insulin response. Chairman: You did that as a routine? Dr Peverill: That is routine and it's written in my books. Would you like to give them the 86 books. Chairman: What, what's the basis of doing that as a routine on these patients. Now what, what are the, your medical reasons for doing that Dr Peverill? Dr Mitchell: Could you direct us to the GTT in your, in your book please? Dr Peverill: ... If you go down the page to insulin which states there for the doctor that we routinely run glucose, we routinely run the insulins on glucose tolerance test samples. Chairman: Yes, what's the reason for that? (Transcript p 106) 97. Later in the hearing, Dr Peverill was asked about a patient whose doctor had requested "viral studies". It appeared from the clinical notes on the request form that the patient was suffering from pain or swelling in his left ankle. The Committee noted that a herpes test was performed. The following exchange occurred: "Dr Mitchell: How is herpes going to help you in this clinical setting of the detection of ... What's the likelihood of detecting herpes in this clinical setting? Dr Peverill: Well because it's a common viral illness in, in, in the community and it can give you fever and pain, it was, it was included as our grouping. ... Dr Mitchell: Presumably somebody made the decision to do that test. Dr Peverill: Yes well it's, he's asked for it as, as viral studies and that's our grouping are you with me? If the doctor wanted not our normal grouping done, you know, all he's got to do is write down the individual tests and that's what we'll do. Dr Mitchell: It seems to me this committee has to decide whether certain services were not reasonably necessary in a man who has something wrong with his left lateral malleolus (ankle) and might ask about the relevance of rubella and herpes. Dr Peverill: See rubella is one of the commonest causes of viral arthritis and herpes as a, you know as a systemic - can give you quite marked fever and, and myalgia whether it gives, I don't think it's listed as one of the commonest causes of arthritis. Dr Mitchell: I don't see that fever and myalgia are written here on the request form. Dr Peverill: No, no I agree with that. ... Dr Mitchell: So it's fair to say that when they put down viral studies or anything like that agglutination you indiscriminately provide them with everything? Dr Peverill: We do the group. Dr Mitchell: Irrespective of the clinical history? Is that what you're saying? Dr Peverill: Well we consider that the clinical history he's looked at that as well as giving, looking at our book and put it together and we give him those basic groups of tests. Dr Mitchell: So you give him everything irrespective of what he writes? ... Dr Hinkley: Just following on from that then is there any point in any of your referring doctors giving you any clinical details at all? How does that modify your practice? Dr Peverill: ... (I)f he's asked for viral studies we're, if you like, bound to give him the group that we give him because that's the communication we've got between the doctor and the pathology." (Transcript pp 194-196) 98. There are other passages to like effect elsewhere in the transcript. From this material, it is clear that the Committee was concerned not only with the actual services rendered by Dr Peverill but also with the system adopted by Dr Peverill's practice, based on the Data Book, which led to the automatic rendering of these services and the response of Dr Peverill to these requests. Dr Peverill thus was on notice of matters of concern to the Committee which ultimately grounded the findings as to personal fault. 99. The final ground is what we have referred to as an unreasonableness point, namely that the sanction imposed upon Dr Peverill was disproportionately severe. We should say that it is difficult from the material presented to the Court on the appeal to ascertain the content or the basis of this submission. It appears that the thrust of the submission is that because the number of patients concerned was only a small part of Dr Peverill's practice and that Dr Peverill was not directly responsible for many of them, the sanction imposed was excessive. 100. As to the latter point, it should be noted that sub-s. 105 (2A) contains provisions, equivalent to sub-s. (2), with respect to the disciplining of employers who cause or permit employed practitioners to render excessive services. However, this sub-section was not utilised by the Committee in making its recommendations. The recommendations were expressly made pursuant to sub-s. 105 (2). This is not surprising as Dr Peverill had declared upon the relevant Medicare assignment form in respect of every service the subject of investigation that he had "actually rendered the services". He was the person who received the Medicare payment in respect of the services. This was because he was the pathology practitioner who had given the relevant undertaking. 101. In view of the fact that the Committee's concern was with the system administered by Dr Peverill, that Dr Peverill was clearly the controlling hand behind his practice and that all the procedures the subject of inquiry were authorised and approved by Dr Peverill, it is difficult to see any error made by the Committee in approaching the matter on the basis that Dr Peverill was fully responsible for the rendering of the relevant services. The Committee found that Dr Peverill had instituted a system likely to lend itself to the rendering of excessive services and found a considerable number of such services rendered. In the light of these findings, the recommendations of the Committee or the Minister's subsequent determination cannot be said to be excessive, in any way which would attract judicial review. Orders 102. The result is that the appeal in substance should be dismissed and the appellant should pay the costs of the respondents. 103. The costs of the first four respondents should be those of a submitting party. On the final day of the hearing of the appeal, counsel for the Minister indicated that he was instructed that the first four respondents, the Committee members, wished to file a submitting appearance. On 28 September 1994 a submitting appearance was filed by the Australian Government Solicitor, indicating that the first to fourth respondents submitted to any order the Court wished to make, save as to costs. 104. Two sets of orders were made by Einfeld J, the first on 31 May 1994 when he dismissed Dr Peverill's application and ordered him to pay the costs of the respondents, and the second on 16 June 1994 when he made the following orders: "1. The decision of Mr Justice Einfeld on 31 May 1994 be stayed pending the determinations of the Appeal to the Full Court of the Federal Court. 2. The Fifth Respondent be prohibited from giving effect to the decision of Mr Justice Einfeld on 31 May 1994. 3. The Fifth Respondent be restrained from considering or giving further consideration to the acceptance of the Applicant's undertakings given pursuant to Section 23DC and Section 23DF of the Health Insurance Act 1973. 4. The Notice of Appeal dated 22nd June 1994 be filed not later than 4 p.m. on Wednesday, 22 June 1994. 5. The Appeal be prosecuted with due expedition. 6. Liberty be reserved to the Respondents to apply for a revocation or variation of the stay at anytime after 4th July 1994. 7. The costs of the motion be costs in the Appeal." 105. Orders 2 and 3 of the orders made by Einfeld J on 16 June 1994 should be set aside. The other orders made on that date are now spent, except for order 7 which provided that the costs of the motion be costs in the appeal. It follows from the result today and from order 7 made by Einfeld J on 16 June 1994 that Dr Peverill also will bear the costs of the motion which led to the making of the orders on 16 June.