Federal Court of Australia Barnes v Director of Professional Services Review [2023] FCA 129 File number(s): NSD 1182 of 2021 Judgment of: BURLEY J Date of judgment: 24 February 2023 Catchwords: ADMINISTRATIVE LAW – judicial review – Professional Services Review Scheme under Part VAA of the Health Insurance Act 1973 (Cth) – application for review of decision by the Director of Professional Services Review to establish a Professional Services Review Committee to investigate whether the applicant general practitioner had engaged in inappropriate practice – whether the Director denied the applicant procedural fairness or natural justice when purporting to determine what action to take under section 89C of the Health Insurance Act 1973 (Cth) and decide to set up the committee – whether the Director's decisions were legally unreasonable – application dismissed Legislation: Administrative Decisions (Judicial Review) Act 1977 (Cth) ss 5, 6 Health Insurance Act 1973 (Cth) ss 79A, 82, 86, 88A, 88B, 89B, 89C, 90, 91, 92, 92A, 93, 95, 101, 106KD, 106L, 106SA, 106T, 106TA, 106U, Pt VAA Judiciary Act 1903 (Cth) s 39B Cases cited: Applicant VEAL of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs [2005] HCA 72; 225 CLR 88 BHL19 v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs [2020] FCAFC 94; 277 FCR 420 CNY17 v Minister for Immigration [2019] HCA 50; 268 CLR 76 Commissioner for Australian Capital Territory Revenue v Alphaone [1994] FCA 293; 49 FCR 576 Daniel v Kelly [2003] FCA 772; 200 ALR 379 Darnell v Stoneheath Pty Ltd [2022] FCAFC 76 Dimian v Health Insurance Commission [2005] FCAFC 200 Huddleston v Aboriginal Land Commissioner [2010] FCAFC 66; 184 FCR 551 Karmakar v Minister for Health (No 2) [2021] FCA 916 Kioa v West [1985] HCA 81; 159 CLR 550 Minister for Immigration and Border Protection v SZMTA [2019] HCA 3; 264 CLR 421 Minister for Immigration and Border Protection v WZARH [2015] HCA 40; 256 CLR 326 Minister for Immigration and Citizenship v Li [2013] HCA 18; 249 CLR 332 Minister for Immigration and Citizenship v SZGUR [2011] HCA 1; 241 CLR 594 Minister for Immigration and Multicultural Affairs v Yusuf [2001] HCA 30; 206 CLR 323 Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs v CQZ15 [2021] FCAFC 24; 284 FCR 455 MZAPC v Minister for Immigration and Border Protection [2021] HCA 17 National Home Doctor Service Pty Ltd v Director of Professional Services Review [2020] FCA 386; 276 FCR 338 Oreb v Willcock [2005] FCAFC 196; 146 FCR 237 Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Lam [2003] HCA 6; 214 CLR 1 Tisdall v Kelly [2005] FCA 365; 219 ALR 152 Yoong v The Chief Executive of Medicare [2021] FCA 701 Division: General Division Registry: New South Wales National Practice Area: Administrative and Constitutional Law and Human Rights Number of paragraphs: 126 Date of hearing: 18 October 2022 Counsel for the Applicant: Dr J Lucy Solicitor for the Applicant: Unsworth Legal Pty Ltd Counsel for the First Respondent: The first respondent filed a submitting notice, save as to costs Counsel for the Second Respondent: The second respondent filed a submitting notice, save as to costs Counsel for the Third Respondent: Ms T Wong SC with Ms C Ernst Solicitor for the Third Respondent: Clayton Utz ORDERS NSD 1182 of 2021 BETWEEN: DR JAMES BARNES Applicant AND: DIRECTOR OF PROFESSIONAL SERVICES REVIEW First Respondent PROFESSIONAL SERVICES REVIEW COMMITTEE NO 1495 Second Respondent COMMONWEALTH OF AUSTRALIA Third Respondent order made by: BURLEY J DATE OF ORDER: 24 February 2023 THE COURT ORDERS THAT: 1. The application for review be dismissed. 2. The applicant pay the costs of the Third Respondent. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. REASONS FOR JUDGMENT 1 INTRODUCTION [1] 2 THE RELEVANT LEGISLATION [5] 3 BACKGROUND [18] 4 THE APPLICATION FOR JUDICIAL REVIEW [62] 5 GROUND 1 – DENIAL OF PROCEDURAL FAIRNESS [64] 5.1 Introduction [64] 5.2 Opportunity to discuss entering into a s 92 agreement [68] 5.2.1 The submissions [68] 5.2.2 Consideration [70] 5.3 Failure to disclose adverse comments and apprehended bias [83] 5.3.1 The submissions [83] 5.3.2 Consideration [94] 6 GROUND 2 – LEGAL UNREASONABLENESS [116] 6.1 The applicant's submissions [116] 6.2 Consideration [119] 7 DISPOSITION [126] BURLEY J: 1. INTRODUCTION 1 In these proceedings the applicant, a medical practitioner, seeks judicial review of a decision of the first respondent, the Director of Professional Services Review, to establish the second respondent, Professional Services Review Committee No 1495, to investigate whether the applicant engaged in inappropriate practice under s 93 of the Health Insurance Act 1973 (Cth). The third respondent is the Commonwealth of Australia. The Director and the Committee entered submitting appearances. 2 In his originating application for judicial review, the applicant contends: (1) that the Director denied him procedural fairness or natural justice when purporting to determine what action to take under s 89C of the Act and when purporting to decide to set up the Committee and to make a referral to it under s 89C(2)(c) or s 93 of the Act; and (2) that the Director's purported decision under s 89C(2) of the Act as to what action to take and her purported decisions to set up a committee and make a referral to it under s 93(1) of the Act were legally unreasonable. 3 The applicant seeks orders declaring void or setting aside the decision to set up the Committee, declaring that the Committee is not validly constituted, and prohibiting any meetings or hearings or making findings or taking any other steps pursuant to subdivisions B and C of division 4 of part VAA of the Act. 4 For the reasons set out below, the application must be dismissed. 2. THE RELEVANT LEGISLATION 5 The Professional Services Review Scheme is established in Part VAA of the Act. Its object is to protect the integrity of the Commonwealth medical benefits program, and in doing so protect patients and the community in general from the risks associated with inappropriate practice and also protect the Commonwealth from having to meet the cost of services provided as a result of inappropriate practice (s 79A). 6 Section 86 of the Act provides: (1) Subject to subsection (1A), the Chief Executive Medicare may, in writing, request the Director to review the provision of services by a person during the period specified in the request if it appears to the Chief Executive Medicare that there is a possibility that the person may have: (a) provided services during the period; and (b) engaged in inappropriate practice in the provision of the services. … 7 Section 88 of the Act provides: Director may request further information (1) If the Chief Executive Medicare requests the Director to review the provision of services by a person, the Director may request the Chief Executive Medicare to provide further information in relation to the provision of those services. Note: The Director may request further information from the Chief Executive Medicare either for the purpose of making a decision whether to undertake a review or for the purposes of a review. (2) A request under subsection (1) may relate to any or all of the services provided by the person during the review period. (3) The Chief Executive Medicare must comply with a request under subsection (1) so far as he or she is capable of doing so. 8 Section 88A of the Act provides: Director must decide whether to review (1) If the Chief Executive Medicare requests the Director to review the provision of services by a person, the Director must, within 1 month after receiving the request, decide whether or not to undertake the review. (2) The Director must decide to undertake the review if, after considering the request and any other relevant information the Director has obtained, it appears to the Director that there is a possibility that the person has engaged in inappropriate practice in providing services during the review period. (3) If the Director does not make a decision under subsection (1) within the period of 1 month specified in that subsection, the Director is taken to have decided, at the end of that period, to undertake the review. (4) The Director must give written notice of the decision to: (a) the person; and (b) the Chief Executive Medicare. (5) The notice must be given within 7 days after the decision is made but failure to give the notice within that time does not affect the validity of the decision. (6) If the Director decides to undertake the review, the notice given to the person under review under paragraph (4)(a) must set out the terms of section 89B. (7) Failure to comply with subsection (6) does not affect the validity of the decision. (8) If the Director decides not to undertake the review, the notice given to the Chief Executive Medicare under paragraph (4)(b) must include the grounds for the decision. 9 Section 88B of the Act provides: Scope of Director's review If the Director decides to undertake the review, he or she: (a) may review any or all of the services provided by the person under review during the review period; and (b) may undertake the review in such manner as he or she thinks appropriate; and (c) in undertaking the review, is not limited by the reasons included in the request under subsection 86(3). 10 Section 89B(2) of the Act provides: Power of Director to require the production of documents or the giving of information … (2) For the purpose of undertaking a review, the Director may, by written notice given to: (a) the person under review; or (b) any other person whom the Director believes to have possession, custody or control of, or to be able to obtain, relevant documents; require the person to whom the notice is given: (c) to produce to the Director, or to a person nominated by the Director, such relevant documents as are referred to in the notice; and (d) if the person does not have possession, custody or control of, and cannot obtain, any of those documents: (i) to inform the Director or a person nominated by the Director of that fact; and (ii) if the person knows, or can readily find out, the name and address of a person who has possession, custody or control of, or can obtain, any of the documents—to give that name and address to the Director or to a person nominated by the Director. 11 Section 89C of the Act provides: Director's action following review (1) Following a review of the provision of services by a person, the Director must either: (a) make a decision under section 91 to take no further action in relation to the review; or (b) give the person under review: (i) a written report setting out the reasons why the Director has not made a decision under section 91; and (ii) an invitation to make written submissions to the Director, within 1 month, about the action the Director should take in relation to the review. (2) If the Director gives the person under review a report and invitation under paragraph (1)(b), the Director must, as soon as practicable after taking into account any submissions made as mentioned in subparagraph (1)(b)(ii): (a) decide to take no further action in relation to the review in accordance with section 91; or (b) enter into an agreement with the person under review under section 92; or (c) make a referral to a Committee under section 93. 12 Section 90 of the Act provides: Director may consult on decisions (1) In order to obtain assistance in making his or her decision on a review, the Director may consult one or both of the following: (a) a Panel member; (b) any consultant or learned professional body that the Director considers appropriate. (2) An action or proceeding, whether civil or criminal, does not lie against a person consulted for any statement made, or information given, in good faith to the Director, or a person acting on the Director's behalf, in connection with the consultation. 13 Section 91(1) of the Act provides: Decision to take no further action … (1) The Director may decide to take no further action in relation to a review if he or she is satisfied that: (a) there are insufficient grounds on which a Committee could reasonably find that the person under review has engaged in inappropriate practice in providing services during the review period; or (b) circumstances exist that would make a proper investigation by a Committee impossible. 14 Section 92(1) provides that the Director may enter into a written agreement (a s 92 agreement) with the practitioner under which the practitioner acknowledges that he or she has engaged in inappropriate practice in the review period and under which specified action in relation to the practitioner is to take effect. That specified action may include: a reprimand (s 92(2)(a)); that the practitioner repay the Commonwealth the amount of a Medicare benefit paid for services affected by inappropriate practice (s 92(2)(b)); that the person be disqualified, for a specified period, in respect of the provision of specified services (s 92(2)(f)(i)); and; that the person be fully disqualified for a specified period (s 92(2)(g)). A s 92 agreement must be ratified by the Determining Authority (s 92(3)), whereupon it is binding (s 92(4)(a)-(b)). 15 Section 93 provides that the Director may also set up a committee and make a referral to it to investigate whether the person under review engaged in inappropriate practice in providing the services specified in the referral (s 93(1)). 16 A committee, which consists of a Deputy Director and two other panel members, who must be general practitioners if the person under review was a general practitioner (s 95(1), (5)), may hold a hearing, and must do so if it appears to the committee that the person under review may have engaged in inappropriate practice in providing the referred services (s 101(2)). A committee must prepare a draft report of preliminary findings (s 106KD) and, after taking into account the submissions of the person under review, must prepare a final report setting out the committee's findings (s 106L). Thereafter, the Determining Authority is to be provided with the committee's report, unless it does not contain a finding that the person engaged in inappropriate practice (s 106L(3), (5)). 17 After receiving submissions from the person under review (s 106SA), and preparing a draft determination and taking into account further submissions (s 106T, 106TA(1)), the Determining Authority must make a final determination (s 106TA(1)), which may include: (a) a reprimand to the practitioner (s 106U(1)(a)); (b) a requirement that the practitioner repay to the Commonwealth the whole or a part of a Medicare benefit (s 106U(1)(ca)-(cb)); (c) disqualification of the practitioner for a specified period in respect of the provision of specified services (s 106U(1)(g)); and (d) full disqualification of the practitioner for a specified period (s 106U(1)(h)). 3. BACKGROUND 18 The underlying facts are not in dispute. 19 On 9 February 2021 a delegate of the Chief Executive, Medicare, sent a request to the Director pursuant to s 86 of the Act that she review the provision of services by the applicant to determine whether he may have engaged in inappropriate practice within the meaning of the Act. 20 A practitioner engages in inappropriate practice if the practitioner's conduct in connection with rendering or initiating services "is such that a Committee could reasonably conclude that … the conduct would be unacceptable to the general body of general practitioners" (s 82(1)(a)). 21 The request indicated that the review period was 1 June 2019 until 31 May 2020 and detailed concerns about the applicant's billing under the medical benefits scheme and prescribing under the pharmaceutical benefits scheme during the review period. It identified four concerns being in relation to services rendered for: (1) MBS item 14100 in respect of laser radiation in the treatment of vascular abnormalities of the head or neck; (2) MBS item 30192 in respect of treatment by ablative technique of 10 or more premalignant skin lesions; (3) MBS 30196 in respect of removal by serial curettage, carbon dioxide laser or erbium laser excision with any associated cryotherapy or diathermy of malignant neoplasm of the skin or mucous membrane; and (4) MBS item 45201 in respect of the repair of a surgical excision made in the removal of a skin legion with a muscle, myocutaneous or skin flap. 22 The Director was obliged by s 88A to decide within one month whether or not to undertake the review. 23 On 23 February 2021 the Director notified the applicant of the request, advised him of her view that there is a possibility that he had engaged in inappropriate practice and advised him that she had decided to undertake the review in accordance with s 88A(4)(a). 24 The Director required the applicant to produce documents relevant to her review, pursuant to s 89B of the Act. The applicant provided the documents as requested. 25 On 18 May 2021 the Director contacted a specialist medical practitioner (Consultant) for the purpose of obtaining assistance in making her decision on review, in accordance with s 90 of the Act. The Consultant thereafter provided assistance to the Director. 26 The affidavit of Ian Temby, a solicitor engaged by the Commonwealth, annexed documents material to the proceedings. They include email correspondence from 18 May 2021 to 15 June 2021 between the Consultant, employees of the Professional Services Review Agency and the Director and also a spreadsheet containing comments made by the Consultant. 27 Of particular relevance to the present application are a number of observations and comments made by the Consultant in the email correspondence and the spreadsheet. 28 On 29 May 2021, the Consultant wrote to Angela Moran, an employee of the Agency, asking about clinical notes that he had been supplied and saying "Essentially, the clinical notes I have seen so far are appalling" and saying that the applicant's general note-taking standard, absent some other form of clinical record such as photographs, is such that, without them, the applicant is "utterly stuffed". 29 On 1 June 2021, Ms Moran emailed a response, indicating that the applicant had been asked to provide his full records, including photographs and imaging, attaching the letter from the applicant's lawyer confirming that all records have been provided and asking that the Consultant should proceed to express any concerns that he has based on what has been provided. Ms Moran also noted that the applicant would get a further opportunity to respond or provide information at the meeting with the Director and at the submissions stage. 30 On 1 June 2021, the Consultant sent an email to Ms Moran saying: … Thank you for the lawyer's letter. Unless it contains revelations of a biblical proportion, Dr. Barnes has a bit of explaining to do when he meets with the Director. 31 On 6 June 2021, the Consultant reported to employees of the Agency as follows (emphasis in original): I am fairly convinced that there is very deliberate fraud occurring, on a level different to the usual 'crimes of omission' (or just general ignorance of the MBS) that I usually see. This appears to be a 'crime of commission', whereby Dr Barnes is altering clinical notes and pathology requests with the specific aim of fraudulently claiming item 30196. I have now seen this in 3 out of the 10 patients being audited for 45201 claims, when I looked back at their pathology reports and consultations immediately prior to their surgeries. … I have explained all of this in detail in the spreadsheet which I will endeavour to get to you by midweek. … 32 On 7 June 2021, Ms Moran responded to the Consultant and observed "[w]hat you're suggesting is very serious indeed" and indicating that she would pass the information on to the Director. 33 On 7 June 2021, Ms Moran sent an email to the Director which included the Consultant's earlier emails, saying that she and Jordan Sacco, another employee of the Agency, were investigating the concerns raised. 34 On 8 June 2021, the Consultant sent a further email to Ms Moran, reporting that the review was complete and that more "of concern" was found as set out in the spreadsheet. He also says (emphasis in original): …Ultimately, it seems as though his potentially deliberate misdemeanours centre around 'protecting' himself against any Medicare query over both curetting and excising a single skin cancer by deliberately altering its anatomical location in the notes and histology requests so that the cancer operated upon seems to be a different cancer to the one previously curetted, although they are actually one-and-the-same. … Of course, I may just have a statistically anomalous sample where this seems to have occurred but this never happens in other cases. The easiest way to find out would be to run the numbers… 35 I refer to the Consultant's concerns about the fraudulent alteration of the records concerning MBS 30196 as set out in [31] and [34] above as the 30196 concerns. 36 On 9 June 2021, Ms Moran replied to the Consultant and indicated "Once we have the data and receive the USB with the review, I will pass it on to the Director for her further review". The Consultant prepared the spreadsheet and then sent it to the Agency on a USB drive. 37 On 11 June 2021, Ms Moran sent a further email to the Director providing her with a copy of the spreadsheet and stating: We have received the attached complete worksheet from [the Consultant] in the review of 1495. Jordan and I are continuing to investigate his concerns about fraudulent records. … 38 The spreadsheet sets out the Medicare item number in dispute, lists patient names and provides a commentary by the Consultant of the services said to have been provided by the applicant. It is 21 pages long. It describes, by reference to the notes of 10 patients, the Consultant's concerns in respect of the records of a number of those patients. An example of such a description, which is repeated for several patients, is as follows (emphasis in original): This consultation technically fulfils the criteria for a level B, item 23. However: a) Every patient appears to have had 11 (and only 11) actinic keratosis treated by cryotherapy. This calls into question the veracity of the notes as it is statistically impossible that this could actually be the case. Thus, a proportion of the clinical notes must contain untruths (NB The usual defence to this is that the phrase called into question – in this case "Cryo 11 AKL's" – is simply "shorthand"; in this case for fulfilling the MBS descriptor for item 30192 that mandates treatment of greater than 10 actinic keratosis. However, that "defence" is highly misguided and ultimately meaningless since the medical records form a legal document and what one writes in them is either the truth or a lie. When one writes "11 AKs" that must be a truthful representation of what actually happened to that patient, ergo, in at least a proportion of these patients' notes, Dr Barns has lied…. 39 The spreadsheet makes the following further references (emphasis removed): (a) Whether the stated location for the shave in December was deliberately altered to obscure a connection to the prior curetting in August is open to debate but certainly not inconceivable (especially given later examples of similar). (b) … every time a 30196 is claimed but the patient went on to have definitive surgical removal of the cancer, it represent [sic] fraudulent claiming. I also have concerns that there is a deliberate attempt to mislead. (c) The note quality is generally appalling. I have concerns that there is a deliberate attempt to mislead. 40 I refer to the Consultant's concerns about the potential "untruths" involved in making repeated reference to the 11 actinic keratosis treated by cryotherapy as identified in the spreadsheet as the Cryo 11 AKL concern. 41 On 15 June 2021, Mr Sacco wrote a detailed email to the Director in which he said (emphasis added): Looking at the records and the data, I do not think [the Consultant's] concern that Dr Barnes fraudulently altered his records and inappropriately claimed MBS item 30196 can be substantiated. Of course, this is only one aspect of [the Consultant's] concerns. 42 The email goes on to explain why Mr Sacco thought this by reference to particular patient files. On the same day, the Director emailed her thanks to Mr Sacco for the email and asked him to include the cases referred to in her "visit file". 43 On 14 July 2021, the Director had a telephone conversation with the applicant and his solicitor, Andrew Davey. A file note of the meeting prepared by an employee of the Agency was received in evidence. 44 The file note relevantly records that the Director explained the steps to be discussed at the meeting. It states that the review could end in either dismissal of the review under s 91 of the Act, an agreement under s 92 or referral to a PSR committee of peers. It then records a discussion between the Director and the applicant about his professional background and practice organisation. 45 The note then says that the Director informed the applicant that he had rendered MBS items in each of the four categories of the review at a level that was statistically very high compared to other practitioners (with three of the categories placing him well above the 99th percentile of other practitioners and one placing him second highest amongst all practitioners) before proceeding to set out the concerns that the Director had about her review of the records. In this regard the note says (emphasis added): The Director advised that a peer reviewer had reviewed [the applicant's] notes and expressed some concerns. The Director had also reviewed some of the notes and shared some of these concerns. 46 The note then proceeds to itemise the concerns by reference to each of the categories of complaint and particular patients whose records had been reviewed. In relation to the first named patient, she raised the Cryo 11 AKL concern saying (emphasis added): The Director read the notes and explained that the problem is that the entry is identical across multiple consultations with this patient. The consultation before and after had identical entries, and they were even identical to other patient's entries. The Director expressed a preliminary concern that the record does not accurately reflect what happened in the consultation. The Director would expect to see details of the consultation and what details were given to the patient. A recurring note "Cryo 11 AKs" is in many of the reviewed records. The Director stated that the consultant who reviewed the records said it was unlikely that exactly 11 were identified and treated each time. In terms of taking a complete patient history, the notes do provide a broader context. 47 It was observed for another patient the notes provide that: This record also contains the identical text that was identified earlier "Cryo 11 AKs" and advice regarding the sun. … 48 The response given by the applicant to these allegations is recorded: [The applicant] explained that he knows the patients used as examples quite well but acknowledges that it is not reflected in the records. He said that he asks all his patients appropriate histories and other questions, but that it is not recorded. [The applicant] explained that when he writes "Cryo 11 AKs" he means it to be macro, and that he will often do more. [The applicant] said that he understood 11 to be the minimum to satisfy the requirement and he uses it as a shorthand, but that he can do many more at a time. 49 The notes record: The Director read out the MBS descriptor, and explained that the consultant reviewer had uniform concerns about: • the record being identical across multiple patients and services • no system of recording what lesions are being treated where and when • clinical indication for the lesions • no documentation of how the lesions are being ablated, so that another doctor would know • documenting consent 50 The notes then identifies other patients where the Cryo 11 AKL concern is identified by reference to their records. From time to time, the applicant's responses are recorded. The notes conclude with a summary which says that at the end of the meeting the Director outlined the next steps in the PSR process. The summary at the conclusion said: [The applicant] added in summary that he does all the things that he is required to do and his clinical practice is good, but acknowledges that it hasn't been recorded. 51 On 29 July 2021, the Director wrote a letter to the applicant saying that she had completed her review based on the request, the clinical records that he had produced and their discussions at the 14 July 2021 meeting. The letter says that based on her review, she had not made a decision under s 91 to take no further action in relation to the review and attached her Report setting out her reasons for concluding that "at this stage" of her review, she was not satisfied that there were insufficient grounds on which a committee could reasonably find that he had engaged in inappropriate practice in providing services during the prescribed review period, or that there were circumstances that would make a proper investigation by a committee impossible. 52 The letter invited the applicant to make written submissions to her within one month, about the action that she should take in relation to the review, saying that it would be helpful for the submissions to include details on any actions taken by the applicant to address Medicare's concerns, his response to the Report, any practice changes since the review period and the action he thinks the Director should take in relation to the review. It concluded saying: After considering your written submissions, if any, I will, as required by subsection 89C(2), do one of the following: • take no further action (under section 91 of the Act); or • seek to enter into an agreement with you (under section 92 of the Act); or • refer the review to a Professional Services Review Committee (under section 93 of the Act). 53 The Report provides some relevant background information concerning the request and the review conducted by the Director. It provides at [7] (emphasis added): As part of my review, the clinical records that were provided were examined in assessing whether or not there were grounds on which a Professional Services Review Committee (Committee) could reasonably find that you have engaged in 'inappropriate practice' as defined by the Act in relation to any of those services. In forming the views I have set out in this report, I have had regard to your clinical records and to peer opinion. 54 The reference to "peer opinion" can be taken to be a reference to the opinions of the Consultant. 55 The concerns identified as part of the Cryo 11 AKL concerns are set out in detail. These included that in a number of instances the applicant billed MBS item 23 and 30192 and recorded only "Cryo 11 AKs. Advice re sun protection with avoidance, clothing, UV creams". The Director expressed concern that the applicant's peers may consider that separate consultations for both MBS items were not conducted and, even if they were, that the records for those services are inadequate as they uniformly lacked a patient history or results of any examination (other than, in some instances, that the patient had actinic keratosis). 56 The Report also states: 20. Further, as discussed during our teleconference, many of your records contained the identical text "Cryo 11 AKs" often without any other information. You told me that you understood that 11 lesions was the minimum required for the purposes of MBS item 30192 and that the text merely reflected a macro. You said that you would often treat more than 11 actinic keratosis patches. 21. Given your explanation I am concerned that your records do not appropriately identify the number of lesions for any particular patient. I am also concerned that your records do not identify where the lesions were located on the patient's body. Your peers may consider that recording the precise number and location of lesions is important to monitor the patient's progress and to assist you (or another practitioner) at a later date in the case of new lesions or growths in the same area. … 32. As indicated above, the cut and paste text does not sufficiently describe the number or location of lesions on each individual patient. It also fails to indicate whether treatment by cryotherapy was clinically indicated and whether other treatments had been trialled. During our teleconference you told me that you only treat lesions if you determine that it is clinically necessary to do so, however this was not evidence in the records I reviewed. 57 The summary section of the Report states: 44. Following the review of your records and my teleconference with you, I have concerns in relation to your rendering of MBS items 23, 14100, 30192, 30196 and 45201. My concerns include that: • Your records are inadequate; • You did not always provide a separate attendance service when rendering MBS item 23; • Your clinical input into MBS item 14100 services was insufficient; • The services were not always clinically indicated; • Your clinical input was not always adequate; and • The MBS requirements were not met. 58 On 6 September 2021, the applicant's solicitor provided a detailed submission to the Director. It concluded with general observations from the applicant to the following effect: (1) Accepting, with the benefit of hindsight, that his medical record keeping practices during the review period fell short and have let him down; (2) Submitting that he has made significant attempts to rectify that aspect of his practice; (3) Submitting that the Director ought to review and alter her findings in respect of the applicant's clinical input and the necessity for the provision of the services; and (4) Submitting that the matter is capable of resolution by entering into an agreement pursuant to s 92 of the Act. 59 The Commonwealth correctly submits that the only concession made by the applicant in his submissions is in relation to the record keeping concern. He did not accept or acknowledge the balance of the concerns were valid. 60 After receiving the applicant's submissions, the applicant was initially invited by a delegate of the Director to participate in further discussion with the Director, but on 14 September 2021 arrangements for doing so were cancelled. 61 On 21 October 2021, the Director provided the applicant with a letter dated 19 October 2021 enclosing an instrument pursuant to s 93(1) of the Act that established the Committee, and made a referral to the Committee to investigate the applicant's possible inappropriate practice. The letter enclosed a further report prepared by the Director pursuant to s 93(6) of the Act. It is unnecessary to refer in detail to the further report, as the present application concerns the decision made in determining to decide to set up the Committee, rather than the steps taken subsequent to that decision. 4. THE APPLICATION FOR JUDICIAL REVIEW 62 In his amended originating application for judicial review, the applicant advances the following two grounds, pursuant to ss 5 and 6 of the Administrative Decisions (Judicial Review) Act 1977 (Cth) (ADJR Act) and ss 39B(1) and (1A) of the Judiciary Act 1903 (Cth): (1) The Director denied the Applicant procedural fairness or natural justice when purporting to determine what action to take under s 89C(2) of [the Act], and when purporting to decide to set up a committee and to make a referral to it under s 89C(2)(c) and, or alternatively, s 93 of the Act. Particulars (a) The [Director] failed to give the Applicant an adequate opportunity to make submissions, including oral submissions, as to why she should not make a referral under s 93 of the Act, but instead enter into an agreement with him under s 92 of the Act. (b) The Applicant's solicitor made a reasonable request, on behalf of the applicant, in submissions dated 6 September 2021, that the Director discuss with him the possibility of the Applicant entering into an agreement with the Director under s 92 of the Act. The failure to afford the Applicant or his solicitor an opportunity to discuss entry into an agreement under s 92 of the Act, prior to making the decision under s 93 of the Act, constituted a denial of procedural fairness. (c) Further, or alternatively, the Director denied the Applicant procedural fairness by deciding to refer the matter to a committee on the basis of the Director's consideration (amongst other things) of "comments from a consultant (engaged under section 90 of the Act) who is a currently practising general practitioner specialising in skin cancer medicine", without first disclosing the substance of all of those comments to the Applicant and providing him with a reasonable opportunity to make submissions about them in that this conduct: (i) constituted a breach of the hearing rule; and, or alternatively, (ii) gave rise to a reasonable apprehension of bias. (2) The Director's purported decision under 89C(2) of the Act, as to what action to take, and her purported decisions to set up a committee and make a referral to it under s 93(1) of the Act, were legally unreasonable. Particulars (a) The purported making of decisions under s 93 of the Act, without first having a discussion with the Applicant or his legal representative about entry into an agreement under s 92 of the Act, was inconsistent, in all of the circumstances, with the scope and purpose of the powers conferred by ss 89C(2) and 92 of the Act. (b) The result bespeaks error. (c) The relevant circumstances include that: (i) the Applicant had accepted that there were shortcomings in his conduct under review during the review period, as conveyed to the Director in his submissions of 6 September 2021; (ii) the Applicant's solicitor had asked the Director to discuss with him the possibility of the Applicant entering into an agreement under s 92 of the Act, in those submissions; (iii) the Director had, on 7 September 2021, through staff of the Professional Services Review Agency, expressed a willingness to have a teleconference with the Applicant's solicitor to discuss the "next steps" in her review; (iv) the scheduled teleconference was cancelled by a staff member on 14 September 2021 on the basis of the Director's unavailability, with a representation that the staff member would "be in contact regarding next steps in due course"; (v) no further contact was made by or on behalf of the Director with the applicant or his legal representative before the purported referral decision. 63 The applicant seeks orders declaring void or setting aside the decisions under s 93 to set up the Committee, declaring that the Committee is not validly constituted, and prohibiting any meetings or hearings or making findings or taking any other steps pursuant to subdivisions B and C of division 4 of part VAA of the Act. 5. GROUND 1 – DENIAL OF PROCEDURAL FAIRNESS 5.1 Introduction 64 This ground is pleaded as a denied procedural fairness under both s 39B of the Judiciary Act or ss 5(1)(a) and/or s 6(1)(a) of the ADJR Act. However, during the course of the hearing, Dr Lucy of counsel, who appeared for the applicant, abandoned reliance on the Judiciary Act basis for this ground. 65 Section 5(1)(a) of the ADJR Act provides: (1) A person who is aggrieved by a decision to which this Act applies that is made after the commencement of this Act may apply to the Federal Court … for an order of review in respect of the decision on any one or more of the following grounds: (a) That a breach of the rules of natural justice occurred in connection with the making of the decision; … 66 Section 6(1)(a) provides: (1) Where a person has engaged, is engaging, or proposes to engage, in conduct for the purpose of making a decision to which this Act applies, a person who is aggrieved by the conduct may apply to the Federal Court or the Federal Circuit and Family Court of Australia (Division 2) for an order of review in respect of the conduct on any one or more of the following grounds: (a) that a breach of the rules of natural justice has occurred, is occurring, or is likely to occur, in connection with the conduct; 67 The applicant contends that the Director denied him procedural fairness or natural justice when determining what action to take under s 89C(2) of the Act and determining to set up a committee and make a referral to it. The ground may be divided into two parts by reference to the particulars supplied. In the first, the applicant contends that he was denied an opportunity to be heard in relation to the decision of the Director to appoint the Committee, rather than negotiating the content of an agreement under s 92 of the Act (particulars (a) and (b)). In the second the applicant contends that he was denied procedural fairness on the basis that the Director failed to identify and disclose to him all adverse comments made by the Consultant and providing him with a reasonable opportunity to make submissions about them (particular (c)) and in so doing acted in breach of the hearing rule or alternatively gave rise to a reasonable apprehension of bias. I address each in turn below. 5.2 Opportunity to discuss entering into a s 92 agreement 5.2.1 The submissions 68 The applicant submits that the Director had a duty to consider whether to exercise the discretion to enter a s 92 agreement in an appropriate case and that s 89C(2) required the Director to choose between three options, being to decide to take no further action, enter into a s 92 agreement, or make a referral to a committee under s 93. He submits that she must give proper, genuine and realistic consideration to each option and that the Director's obligation under s 89C is to provide the practitioner with a reasonable opportunity to make a submission. In the current case, the Director invited the applicant to make written submissions about the action, but, in circumstances where the applicant in his written submissions requested the Director to consider entering into a s 92 agreement, he submits she did not afford him a reasonable opportunity to be heard because "it is the very nature of an agreement that the Director and the practitioner discuss and agree on its terms". The applicant submits that it may be inferred that the Director intended to provide the applicant with an opportunity to discuss entry into a s 92 agreement when she initially indicated that she would like to organise a telephone conference with him to discuss the next steps, but on 14 September 2021 withdrew that offer. 69 The Commonwealth submits that the Act prescribes the particular junctures at which the Director is required to give notice of certain matters and invite submissions. Those requirements were met. It submits that the Court has repeatedly recognised that there is no obligation on the Director to offer to enter into an agreement under s 92, citing Dimian v Health Insurance Commission [2005] FCAFC 200 at [33] (Lander J, Black CJ and Wilcox J agreeing) and Oreb v Willcock [2005] FCAFC 196; 146 FCR 237 at [126] (Lander J, Black CJ and Wilcox J agreeing). Nor, it submits, is the Director required to give reasons for entering an agreement, citing Tisdall v Kelly [2005] FCA 365; 219 ALR 152 at [89] (Gray J), or to provide reasons "at every decision-making point in Division 3A", citing Yoong v The Chief Executive of Medicare [2021] FCA 701 at [90] (Rangiah J). Furthermore, the Commonwealth submits that the scope of what procedural fairness requires cannot have been enlarged by the equivocal statements by officers of the Professional Services Review Agency that a teleconference would be organised with the Director. Finally, the Commonwealth submits that the applicant has not established that he suffered any practical injustice by not having a second opportunity to meet with the Director, citing Huddleston v Aboriginal Land Commissioner [2010] FCAFC 66; 184 FCR 551 at [30] (Keane CJ, Spender and Barker JJ) and Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Lam [2003] HCA 6; 214 CLR 1 at [35] (Gleeson CJ) and [105] (McHugh and Gummow JJ). 5.2.2 Consideration 70 In my view this aspect of ground 1 has not been made out. 71 I agree with the submission advanced by the Commonwealth that the Act prescribes particular points at which the Director is required to give notice of certain matters and submissions from a person under review. There is no suggestion that those requirements were not met. The applicant was on 23 February 2021 notified of the Director's decision to conduct a review. By letter dated 29 June 2021, the Director notified the applicant of the process to be followed, which was foreshadowed to include a meeting with the Director, an opportunity for the applicant to make written submissions and consideration of those written submissions. The Director informed the applicant that, after that, she would "make a decision to either take no further action, seek to enter into an agreement with you or refer the case to a PSR Committee". This accords with the contemplated steps in s 89C. The Director duly met with the applicant on 14 July 2021 and in her letter of 29 July 2021 she invited the applicant to make written submissions, indicating that she would consider them and do one or other of the three things prescribed in s 89C(2) of the Act. 72 It was clear that following the receipt of the submissions the Director would make a decision under s 89C(2). 73 In the applicant's written submissions of 6 September 2021 he said, "… he believes this is a matter which may be capable of resolution by entering into an Agreement pursuant to section 92 of the [Act]". 74 The applicant contends that, by not meeting with him after this suggestion, the Director failed to afford him procedural fairness, because it is the nature of an agreement that the Director and practitioner discuss and agree on its terms. However, as the Court noted in Dimian at [33], the Director "is not obliged to offer to enter into a s 92 agreement with a medical practitioner whose conduct is under review", see also Oreb at [126]. Section 92 permits but does not require the Director to do so, and only permits this if the medical practitioner acknowledges that his or her conduct during the referral period constituted engaging in inappropriate practice. 75 In the present case the applicant suggested that the Director ought to review and alter her findings. It would appear that the request was intended to be the commencement of a negotiation, which might have entailed discussing with the Director as to which of her criticisms would be dropped. Although the Director was free to engage in such negotiations, nothing in the structure or substance of Part 3A of the Act indicates that she was required to do so. 76 In this regard the obiter dicta observations of Ryan J in Daniel v Kelly [2003] FCA 772; 200 ALR 379 at [27]-[29] do not assist the applicant. That case concerned a different version of the Act. The relevant finding was that the Acting Director incorrectly regarded it to be a prerequisite for the exercise of his discretion to discuss entry into a s 92 agreement that the practitioner under investigation first invite recourse to such an agreement and be prepared to concede guilt of inappropriate practice before he could resort to a s 92 agreement. It was in that context that the court considered that there was a denial of procedural fairness. 77 The present case is somewhat different. There is no evidence to suggest that the Director did not consider entry into a s 92 agreement, or that she considered a concession of culpability a prerequisite. Nor is the Director obliged by s 89C(2) to give reasons for entering into (or not entering into) an agreement. Furthermore, there is nothing in the language of the Act which requires the Director to offer to enter into an agreement under s 92: Oreb at [126]. 78 The applicant was offered an opportunity to make submissions, which he took. Thereafter it was open to the Director to determine which of the three courses available under s 89C to take. There is nothing in the Act, or the common law, to indicate that procedural fairness required the Director to give the applicant successive oral hearings, or to receive an early indication from the Director that she was not proposing to enter into an agreement. Procedural fairness does not require that the decision-maker disclose what she is minded to decide so that the parties may have a further opportunity to criticise her mental processes before she reaches a final decision; under s 92; Minister for Immigration and Citizenship v SZGUR [2011] HCA 1; 241 CLR 594 at [9] (French CJ and Kiefel J). In this regard the analogous observations made by Rangiah J in Yoong at [90] are apposite (emphasis in original): … where a decision-maker is positively required to give the person under review an opportunity to be heard as to whether a particular decision should be made, the PSR Scheme tends to make the requirement express, and does not leave it to implication. For example, ss 89C(1), 103(1)(g) and 106H(4) specify that the practitioner must be permitted to make submissions before the relevant decision is made. This is reinforced by s 80(11) which states that, "[p]rovision is made throughout the scheme for the person under review to make submissions before key decisions are made or final reports are given." The fact that s 86 of the HI Act does not expressly provide for a right to make submissions as to why the Chief Executive should not make a request to the Director, while not of itself determinative, strongly suggests that no obligation of procedural fairness is implied. 79 Nor can the scope of any obligation to afford procedural fairness have been expanded by the statements made by the officers of the Agency that the director "would like to organise a teleconference with you to discuss the next steps in her review". There is no indication in these statements as to the purpose of the meeting. 80 Finally, I do not accept that the statements in Oreb and Dimian to which I have referred are inapplicable in the current case. Although the practitioners under review in those cases had not expressed a willingness to enter into a s 92 agreement, the statements of principle in these cases are not limited to those factual circumstances but rather provide guidance to the approach in cases of this type. 81 For these reasons I reject the application insofar as it relies on the first particular appended to ground 1. 82 For completeness I should add that had the applicant been denied procedural fairness by not having a second opportunity to meet with the Director, I am not satisfied that the applicant has established that he would in any event have suffered any practical injustice. The request was couched tentatively as "perhaps" the Director "might" contact the applicant's solicitor after reading the submissions advanced. As I have noted, the applicant's submissions amounted to a rejection of a number of the conclusions expressed by the Director, and acceptance only of infelicities in record keeping. Having regard to the precondition in s 92(1)(a) that before entry into an agreement the practitioner must acknowledge inappropriate practice, I am not satisfied that the applicant has established that he has lost any opportunity to put any information or argument to the Director, or otherwise suffered any detriment that would amount to a practical injustice of the type contemplated in Ex Parte Lam, see, for instance, at [35]-[38] (Gleeson CJ); and [105] (McHugh and Gummow JJ). 5.3 Failure to disclose adverse comments and apprehended bias 5.3.1 The submissions 83 The applicant contends in the third particular appended to ground 1 that the Director denied him procedural fairness by deciding to refer the matter to a committee under s 89C(2)(c) of the Act on the basis of her consideration, amongst other things, of comments from the Consultant, without first disclosing the substance of all of those comments to the applicant and providing him with a reasonable opportunity to make submissions about them. 84 The impugned comments identified by the applicant in his written submissions are comments or allegations made by the Consultant that I have identified as the 30196 concerns and the Cryo 11 AKL concerns. 85 The applicant submits that the Director's failure to disclose the Consultant's allegations of fraud to him constituted a breach of her implied obligation of procedural fairness, citing Minister for Immigration and Border Protection v SZMTA [2019] HCA 3; 264 CLR 421 at [38] (Bell, Gageler and Keane JJ). He submits that the Director was required to disclose to him the substance of the Consultant's allegations, because this was credible, relevant and significant information that could not be dismissed from further consideration by the director before she made a decision under s 89C(2) of the Act not to attempt to enter into an agreement under s 92, citing Applicant VEAL of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs [2005] HCA 72; 225 CLR 88 at [17] (Gleeson CJ, Gummow, Kirby, Hayne and Heydon JJ). He submits that the question of whether information was credible, relevant and significant is to be determined before the Director reached her decision, and that it was relevant because, if the Director considered that a committee could also form the view that Dr Barnes had acted fraudulently, she may have been more inclined to refer the matter to a committee than to enter into a s 92 agreement. 86 The applicant submits that the Director was bound by an obligation to reveal the allegations irrespective of whether she gave them any weight, and that it is not to the point to ask whether the material did in fact play a part in influencing the Director's decision under s 89C(2). The relevant inquiry is what procedures should have been followed. 87 The applicant submits that in his case, which is confined to the application of the ADJR Act, it is not necessary for him to establish materiality in the sense considered in MZAPC v Minister for Immigration and Border Protection [2021] HCA 17. It is sufficient to establish the ground of review under s 5(1)(a) that the non-disclosure was of credible, relevant and significant information. In this regard, the applicant seeks to distinguish other decisions of this court, which have determined that materiality in the sense considered in the context of jurisdictional error is relevant to the establishment of error, on the basis that those cases concerned other sub-sections within s 5(1), but not s 5(1)(a) of the ADJR Act. 88 In relation to apprehended bias, the applicant submits that the Consultant's impugned comments constitute undisclosed, prejudicial material which had the potential to have a conscious or subconscious impact on the Director, such that a fair-minded lay observer properly informed might reasonably apprehend that she might not bring an impartial and unprejudiced mind to the resolution of the factual and legal questions that arose for her decision as to what action to take following her review, citing MZAPC at [71]. He contends that the question is whether the information was so "highly prejudicial" to the appellant that "the fair-minded lay observer, acting reasonably, would not dismiss the possibility that [the Director] may have been affected by [the impugned comments]", albeit that this may have been subconscious (at [72]). 89 The applicant contends that the impugned comments were highly prejudicial but that the Director at no time indicated that the prejudicial material had been disregarded or given no weight when deciding not to negotiate a s 92 agreement. The purpose of a s 90 consultant is for the Director to obtain assistance in making his or her decision on a review. Accordingly, the fair-minded lay observer might expect the Director to give the consultant's opinion some weight. The "abrupt and unexplained" decision on the part of the Director not to meet the applicant may, in the eyes of the fair-minded lay observer, acting reasonably, not dismiss the possibility that the Director may have been affected by the consultant's opinions when deciding not to enter into a s 92 agreement, whether consciously or subconsciously, citing CNY17 v Minister for Immigration [2019] HCA 50; 268 CLR 76 at [111] (Edelman J). 90 The Commonwealth first submits that the nature of the information that the applicant contends was required to have been disclosed comprised opinions of the Consultant. It submits that this was information one step removed from the views of the decision-maker and was not required to be disclosed, citing Karmakar v Minister for Health (No 2) [2021] FCA 916 at [50] (Logan J). The obligation of the Director does not extend to disclosing the assistance received from a consultant, but to furnish the practitioner with a "written report setting out the reasons why the Director has not made a decision under s 91" under s 89C(1)(b)(i). After inviting the practitioner to make written submissions, the Director must take them into account in making, "as soon as practicable" thereafter, one of the three decisions under s 89C(2), relevantly here, the decision under s 89C(2)(c) to refer the matter to a Committee. This scheme does not require information provided to the Director by way of assistance to be disclosed. 91 The Commonwealth submits that there is nothing to suggest that the Director adopted or gave any weight to the Consultant's comments and that the evidence points to a contrary conclusion. It submits that the heart of the applicant's argument is a contention that, irrespective of whether the Director had regard to the comments, she was obliged to disclose them to overcome any unconscious prejudice that the adverse material could create. This, it submits, closely resembles an argument rejected by the High Court in MZAPC. This provides a complete answer to the applicant's case because, the Commonwealth submits, there is no evidence capable of founding an inference that the Director took account or placed any weight upon the comments concerned and in fact the evidence suggests the contrary. The Commonwealth submits that the applicant's reliance on VEAL is misplaced in light of the more recent MZAPC. 92 The Commonwealth submits that "materiality", as that term is used in MZAPC, is a precondition to the finding of error under s 5(1)(a) of the ADJR Act citing cases determined by this court on the question. It submits that in any event, even if materiality is not a precondition to the grant of relief, it is undoubtedly a consideration that bears on the exercise of the discretion to grant relief under s 16 which, in the circumstances of the present case, would warrant refusal of relief, citing Darnell v Stoneheath Pty Ltd [2022] FCAFC 76 at [148] (Markovic, Thomas and Stewart JJ). 93 In relation to apprehended bias, the Commonwealth submits that the impugned comments were not of the type that would cause the independent lay-observer to the view that the Director was not bringing an unbiased mind to the determination. It refers to CNY17 and Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs v CQZ15 [2021] FCAFC 24; 284 FCR 455 at [115] (Kenny, Bromberg and Anderson JJ) to demonstrate that the information in those cases exemplify statements unlike those in the present case, which the Director and her staff were able independently to verify and then reject. Furthermore, the Commonwealth submits that there are several sound reasons for the Director to elect not to further meet with or negotiate with the applicant for an agreement under s 92 of the Act. The main, and most cogent, reason is because in his submissions the applicant continued to dispute five of the six complaints raised in the Report, and that the Director considered that it was appropriate to refer the matter to the Committee to investigate further. 5.3.2 Consideration 94 It is important to appreciate the sequence of events relevant to this ground. 95 On 6 and 8 June 2021, the Consultant, in accordance with the Director's request made under s 91 of the Act, sent emails to staff of the Director identifying his 30196 concerns, as set out in [31] and [34] above. A short while later, he set out his Cryo 11 AKL concerns in the spreadsheet. 96 On 15 June 2021 Mr Sacco wrote to the Director, informing her that he did not think that the Consultant's 30196 concerns (that the applicant had fraudulently altered his records and inappropriately claimed MBS 30196) were substantiated by the data. 97 On 14 July 2021 the Director had a telephone conversation with the applicant in which she put various matters about his conduct to him. Those included the Cryo 11 AKL concerns, but not the allegations of fraud or deliberate alteration of patient records as set out in the Consultant's 30196 concerns. 98 The Director made a decision not to take no further action under s 91. In accordance with s 89C(1)(b) she was obliged to give to the applicant her written report, setting out her reasons, and inviting the applicant to make written submissions within 1 month about the actions she should take in relation to the review. 99 The Director supplied the applicant with her Report on 29 July 2021. It conveys her concerns. Notably, she does not mention the allegations of fraud or deliberate alteration of patient records as set out in the 30196 concerns. It may be inferred that in her report she had regard only to matters that she considered to be of relevance to her decision under s 89C(1) to continue with the review and did not refer to mental processes or provisional views reached before the making of the decision; see, by analogy Minister for Immigration and Multicultural Affairs v Yusuf [2001] HCA 30; 206 CLR 323 at [69] (McHugh, Gummow and Hayne JJ); MZAPC at [67]-[69] (Kiefel CJ, Gageler, Keane and Gleeson JJ); Commissioner for Australian Capital Territory Revenue v Alphaone [1994] FCA 293; 49 FCR 576 at 591-592 (the Court). 100 In Kioa v West [1985] HCA 81; 159 CLR 550, Brennan J noted that a person "whose interests are likely to be affected by an exercise of power must be given an opportunity to deal with relevant matters adverse to his interests which the repository of the power proposes to take into account" in deciding the case (at 628). That is not to say that the person must be given an opportunity to comment on every adverse piece of information, irrespective of its credibility, relevance or significance. As his Honour said (at 628-629): Administrative decision-making is not to be clogged by inquiries into allegations to which the repository of the power would not give credence, or which are not relevant to his decision or which are of little significance to the decision to be made. Administrative decisions are not necessarily to be held invalid because the procedures of adversary litigation are not fully observed … Nevertheless in the ordinary case where no problem of confidentiality arises an opportunity should be given to deal with adverse information that is credible, relevant and significant to the decision to be made. … 101 In that case, Brennan J considered that the failure to give the appellant an opportunity to deal with apparently credible, relevant and damaging information before making an order for deportation left a risk of prejudice which ought to have been removed. As his Honour said (at 629): There was nothing in the circumstances of the case – neither in the administrative framework created by the Act nor in any need for secrecy or speed in making the decision – which would have made it unreasonable to have given [them] that opportunity. The failure to give [them] that opportunity amounts to a non-observance of the principles of natural justice. 102 This passage has been picked up in many cases, including VEAL, where at [17] the Court noted that what is adverse information that is credible, relevant and significant to the decision to be made must be determined by a decision-maker before the final decision is reached, not after a decision has been made when the decision maker has chosen to characterise the information in a particular way. In that case, the Court considered that, where the Tribunal said in terms that it gave no weight to the information in reaching its decision, that did not abrogate the responsibility of the decision-maker to supply the party with an opportunity to respond to it (at [18]). The question was not what decision the decision-maker should have made, nor what reasons the decision-maker gave for the conclusion reached, but rather what procedures should have been followed (at [19]). 103 The applicant submits that the failure on the part of the Director to inform him of the impugned comments denied him of an opportunity to respond to what was credible, relevant and significant information. However, as I explain in more detail below in relation to the apprehended bias submission, the adverse information to which the applicant refers consisted, in the case of the 30196 concerns, of allegations of fraud or deliberate alteration of patient records that were resolved in favour of the applicant upon further investigation, and an opinion that the Cryo 11 AKL concerns references reflected inaccurate ("untruthful") information, which the applicant accepted was the case. 104 Accordingly, the information was either not of the character of credible, relevant and significant information to the decision to be made (in the case of the 30196 fraud concerns) or was information that was in fact disclosed to the applicant (in the case of the Cryo 11 AKL concerns). 105 Furthermore, in a slightly different context, but in relation to the operation of these provisions, in Karmakar at [50], Logan J said, of communications with a consultant under s 90: Whether any consultation as envisaged by s 90 occurs at all is entirely a matter for the Director. If it does, the Director's obligation is not to disclose the assistance, if any, received or the author of any advice but rather, as s 89C(1)(b)(i) of the HIA dictates, to furnish the practitioner concerned with "a written report setting out the reasons why the Director has not made a decision under section 91". The reasons in that report must be those of the Director, not of such person or body, if any she may have chosen to consult for assistance. There is nothing to indicate that the reasons in the report were other than those of the Director. It is to that report containing those reasons that the practitioner is expressly afforded an opportunity by invitation to respond. If those reasons reflect idiosyncratic views within the profession, that will be apparent on the face of the report itself. It would, in my view, have been permissible for the Director, if she chose, to have quoted from any advice which she received under s 90 of the HIA, naming the author, and indicating that she agreed with that advice. But she was under no obligation either expressly by statute or by implication so to do. Indeed, it would be permissible for the Director to consult under s 90 but depart from any resultant advice to her if she had a different opinion. The s 90 process is intramural. The extramural aspect of this stage of the processes for which Pt VAA provides is the report containing the Director's reasons. The reasons which the Director furnished in her report were comprehensive. They conspicuously fulfilled her obligation to afford Dr Karmakar with an opportunity to engage with the critical issues that had not led the Director initially just to decide to take no further action under s 91 and which might persuade her to make a referral to a committee. They also enabled Dr Karmakar to address those same issues to the end of persuading the Director under s 91 that, taking her submission into account no further action ought to be undertaken. 106 The present case concerns s 89C(2), where there is no explicit or additional procedural fairness obligation placed on the Director beyond the requirement that she consider the submissions provided by the applicant. This is within what Griffiths J in National Home Doctor Service Pty Ltd v Director of Professional Services Review [2020] FCA 386; 276 FCR 338 (NHDS) referred to as the "tier two" obligation (at [28]-[42]) where there are explicit procedural fairness requirements imposed upon the Director by s 89C, namely to provide a report and consider any submission made thereafter (at [70]). 107 It would be odd if the requirements of procedural fairness under s 89C(2) imposed an additional obligation upon the Director that is not present in s 89C(1)(b)(i), having regard to the obligation on the Director to make a decision to take one of the steps in s 89C(2) "as soon as practicable" after taking into account any submissions made. 108 In the circumstances, in my view the particular opinions given by the Consultant which were anterior to the provision of the Report were not matters that the Director was required to disclose or put to the applicant in making her decision under s 89C(2). 109 Finally, I note that, whilst in the circumstances it is not necessary to determine whether considerations of materiality as identified in Hossein and MZAPC apply under s 39B of the Judiciary Act 1903 (Cth), in the event that I am incorrect in reaching this conclusion, I would in any event decline the grant of relief in the exercise of discretion under s 16 of the ADJR Act on the basis that in my view no practical injustice can be said to flow from any failure of the Director to refer to the 30196 concerns; Minister for Immigration and Border Protection v WZARH [2015] HCA 40; 256 CLR 326 at [60] (Gageler and Gordon J). It is apparent, for the reasons that I have given, that the Director did not hold the view that the 30196 concerns were warranted. In the case of the Cryo 11 AKL concerns, it is apparent that the substance of what the Director considered to be material about those concerns was squarely put to the applicant, both in the telephone conversation (as recorded in the notes) and also in the Report, which summarised the position that set out the Director's preliminary views at that stage of the review and also the responses of the applicant during the teleconference. Thereafter he supplied his response in his submissions. No practical injustice may be considered to arise from the failure to put the consultant's Cryo 11 AKL concerns to him. 110 Accordingly, I consider that the applicant fails in this aspect of ground 1. 111 In relation to the apprehended bias aspect of the decision, the Full Court in CQZ15 conveniently set out the relevant principles, which are well-settled: 90 The test for apprehended bias in administrative decision-making is whether a fair-minded lay observer might reasonably apprehend that the decision-maker might not bring an impartial mind to the resolution of the question that the decision-maker is required to decide: CNY17 at [17] (Kiefel CJ and Gageler J); [56] (Nettle and Gordon JJ); and [132] (Edelman J). At least the following two steps are involved in a case involving a claim of apprehended bias: first, it is necessary to identify "what it is that might lead a decision-maker to decide a case other than on its legal and factual merits": CNY17 at [57] citing Isbester v Knox City Council [2015] HCA 20; 255 CLR 135 at [21]. One class of thing that may be identified as giving rise to partiality on a decision-maker's part is the possession of extraneous information. As Deane J said in Webb at 74 in relation to extraneous information, there is a category of cases where "knowledge of some prejudicial but inadmissible fact or circumstance gives rise to the apprehension of bias". In this case, as already noted, the first respondent's contention is that the Tribunal's knowledge of the irrelevant and prejudicial information in the Job Details Report gave rise to an apprehension of bias. Secondly, there must be an articulation of the logical connection between the identified thing and the feared deviation from the course of deciding a case on its merits: CNY17 at [57], citing Ebner v Official Trustee in Bankruptcy [2000] HCA 63; 205 CLR 337 at [8]. In this case, as already noted, the first respondent argued that the fair-minded lay observer might have apprehended that the "objectively irrelevant prejudicial information" given by the Secretary to the Tribunal in the Job Details Report might have unconsciously encouraged the Tribunal to form an adverse view of the first respondent's character and credit. 91 In the context of apprehended bias, the hypothetical fair-minded lay observer is attributed with the appropriate knowledge to be able to make a reasonably informed assessment of the likelihood of apprehended bias. Such knowledge includes knowledge of the relevant legal framework – in this case knowledge of the procedures governing the Tribunal's decision-making under Part 7 of the Migration Act. The hypothetical observer is also attributed with knowledge of the identity of the decision-maker, the nature of the decision and issues in question, and of the relevant facts and circumstances leading to the decision, including, of course, the impugned conduct: see, for example, CNY17 at [17] (Kiefel CJ and Gageler J); [58] –[59] (Nettle and Gordon JJ); Isbester at [23] (Kiefel, Bell, Keane and Nettle JJ); Re Refugee Review Tribunal v Ex parte H [2001] HCA 28; 75 ALJR 982 at [27]–[28]. It has been authoritatively stated that the fair-minded lay observer has "broad knowledge of the material objective facts … as distinct from a detailed knowledge of the law or knowledge of the character or ability of the [decision-maker]": Webb at 73, as quoted in CNY17 at [58]. In the latter case, Nettle and Gordon JJ added, at [59], "[w]here, however, … the statutory scheme is complex, the fair-minded lay observer at least must have knowledge of the key elements of that scheme". 92 As the courts have repeatedly noted, the apprehended bias rule is concerned with protecting the public appearance of independence and impartiality, and does not require a finding that the irrelevant and prejudicial information in fact affected the decision made by the decision-maker, here the Tribunal: see, for example, CNY17 at [18] (Kiefel CJ and Gageler J); [70] (Nettle and Gordon JJ); and [131] (Edelman J); and AMA16 at [62] (Griffiths J, with whom Dowsett and Charlesworth JJ relevantly agreed). 112 The impugned comments are set out in the context in which they appeared in Section 2 of these reasons. It may be observed that on 6 and 8 June 2021 the Consultant sent emails to the staff of the Director. In the first he said that he was "fairly convinced that there is very deliberate fraud occurring … This appears to be a 'crime of commission' whereby Dr Barnes is altering clinical notes and pathology requests with the specific aim of fraudulently claiming item 30196" (emphasis in original). On 8 June 2021 he said (emphasis in original): … it seems as though his potentially deliberate misdemeanours centre around 'protecting' himself … by deliberately altering its anatomical location … Of course, I may just have a statistically anomalous sample where this seems to have occurred but this never happens in other cases. The easiest way to find out would be to run the numbers. 113 A week later, Mr Sacco ran the numbers and reported to the Director that he did not think that the Consultant's concern in relation to fraudulent alteration of the records in relation to the 30196 concerns could be substantiated. The notes of 14 July 2021 telephone conversation do not refer to the Director raising this concern with the applicant. Nor does the Report make reference to the concerns. The hypothetical fair-minded lay observer would be conscious of the relevant legal framework, including that the role of the Consultant under s 90(1) of the Act was to provide "assistance" to the Director which the Director may or may not choose to act upon. They would also be aware that the Director is, as the applicant characterised her in his submissions, a professional decision-maker who is charged with making her own decisions under the Act. In my view the fair-minded lay observer would recognise that the Director had put aside the inflammatory and inaccurate statements of the Consultant in reaching her decision as set out in the Report and that she had taken the same view in making her decision under s 89C of the Act. To put the matter in the language required by the authorities, in the circumstances of this case, I do not consider that a fair-minded lay observer might reasonably apprehend that the Director might not bring an impartial mind to the resolution of the question of whether or not to enter into negotiations with the applicant to see whether she may enter into agreement with the applicant under s 92 on the basis of the 30196 concerns as expressed by the Consultant. 114 I take the same view in relation to the Cryo 11 AKL concerns. The spreadsheet contained statements that "a proportion of the clinical notes must contain untruths" and that the applicant had "lied" in relation to records concerning the repetition of the statement about Cryo 11 AKLs. The notes of the telephone conversation with the applicant record that the Director explained that "the problem is that the entry is identical across multiple consultations … and even identical to other patient's [sic] entries. The Director expressed a preliminary concern that the record does not accurately reflect what happened in the consultation". Whilst expressed in more temperate language, the substance of the allegation made by the Consultant, namely that the clinical records contain untruths, or lies, is the same. Moreover, the notes record that the Director reported that the Consultant "said it was unlikely that exactly 11 were identified and treated each time". The applicant answered that allegation by accepting that his records are not accurate, and that "when he writes 'Cryo 11 AKs' he means it to be a macro". 115 In these circumstances, I have no difficulty in concluding that the allegation of apprehended bias is not made out. I do not consider that a fair-minded lay observer might reasonably apprehend that the Director might not bring an impartial mind to the resolution of the question of whether or not to enter into negotiations with the applicant to see whether she may enter into agreement with the applicant under s 92 on the basis of the Cryo 11 AKL concerns as expressed by the Consultant. 6. GROUND 2 – LEGAL UNREASONABLENESS 6.1 The applicant's submissions 116 In ground 2, the applicant contends that the Director's decision under s 89C(2) as to what action to take and her purported decisions to set up a committee and make a referral to it under s 93(1) were legally unreasonable. In his submissions, the applicant contends that the decision to refer him to the Committee, without first discussing with him the nature of the proposed s 92 agreement, was legally unreasonable. In this regard he submits that the Director was obliged to exercise the power in s 89C(2), which relevantly involved a consideration of the powers in s 92 and s 93. The evident purpose of s 92 is to obviate the need for referral to a committee if the Director and the person under review can agree that the person under review engaged in in appropriate conduct and can agree on an appropriate sanction. He submits that the provision in s 92A of the Act for the Determining Authority to have to ratify the agreement safeguards against this being an easy option for the practitioner. 117 The applicant submits that the Director's decision to make a referral to the Committee was arbitrary and unreasonable where the applicant had acknowledged shortcomings in his conduct, indicated a willingness to enter into a s 92 agreement, requested an opportunity to discuss entry into an agreement, and been offered by the Director an opportunity to have a discussion about the next steps in her review, and where a teleconference had been made but cancelled by the Director. He submits that it may be inferred that the Director's decision to refer to the Committee under s 93 indicated a lack of regard for the purpose of s 92 and a failure to have regard to the purposes for which the discretion in s 89C(2) is conferred. 118 The applicant next submits that the decision to refer him to a committee was also legally unreasonable because the Director did not know to what terms the applicant would agree and accordingly did not know whether the Commonwealth would be able to save considerable expense, and the applicant significant stress and uncertainty, by exploring the option of agreement. In that context, the applicant submits that the decision to make a referral to a committee bespeaks an exercise of power beyond its source, within Minister for Immigration and Citizenship v Li [2013] HCA 18; 249 CLR 332 at [85] (Hayne, Kiefel and Bell JJ). She could not reasonably reject the option of a s 92 agreement without first having a discussion with him as to the terms that such an agreement might involve. 6.2 Consideration 119 In BHL19 v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs [2020] FCAFC 94; 277 FCR 420, Wigney J summarised the relevant principles having regard to earlier authority at [130]-[138]. Those principles are familiar, and do not warrant repetition in full here, but I gratefully adopt them. In summary form, the concept of legal unreasonableness concerns the lawful exercise of power. Legal reasonableness, or an absence of legal unreasonableness, is an essential element in the lawfulness of decision-making. The Court's task in determining whether a decision is vitiated for legal unreasonableness is strictly supervisory. It does not involve the Court reviewing the merits of the decision under the guise of an evaluation of the decision's reasonableness, or the Court substituting its own view as to how the decision should be exercised for that of the decision maker. Nor does it involve the Court remaking the decision according to its own view of reasonableness. There are two contexts in which the concept of legal unreasonableness may be employed. The first involves a conclusion after the identification of a recognised species of jurisdictional error in the decision-making process, such as failing to have regard to a mandatory consideration, or having regard to an irrelevant consideration. The second involves an "outcome focused" conclusion without any specific jurisdictional error being identified. 120 The applicant contends that in the circumstances of the present case it may be inferred that the Director's decision to refer him to a committee under s 93 indicated lack of regard for the purpose of s 92, as well as a failure to have regard to the purposes of s 92 and a failure to have regard to the purposes for which s 89C(2) is conferred, particularly in circumstances where the Director did not wait to find out what terms the applicant would agree to before referring the matter to a committee. 121 Division 3A in Part VAA of the Act provides for the conduct of a review of the provision of services by a medical practitioner. By s 88A, the Director must consider whether or not to undertake a review upon receipt of a request by the Chief Executive under s 86. If she decides to conduct a review, she must either, by s 89C(1)(a), decide to take no further action or, under s 89C(1)(b), invite written submissions from the practitioner as to the action the Director should take. By s 89C(2), the Director must, as soon as practicable after taking those submissions into account, decide; (a) to take no further action; (b) enter into agreement under s 92; or (c) make a referral to a committee under s 93. Section 89C(2) imposes no restriction as to how the discretion to elect between these alternatives is to be exercised. Section 92(1) does, however, provide pre-conditions to the entry into an agreement. One is an acknowledgement from the person under review that the person engaged in inappropriate practice in connection with rendering services during the review period. Section 93 provides for the alternative of referral to a committee. 122 As I have noted in Section 5 above, the Director is not obliged to offer an agreement under s 92; Dimian at [33]; Oreb at [126]. Nor, as I have found, did the Director owe a duty of procedural fairness to the applicant to discuss a possible s 92 agreement. Indeed, in the present case the applicant proffered a limited acknowledgement that he had engaged in inappropriate conduct. He did not acknowledge all of the allegations made. The preconditions for entry into an agreement were accordingly not met. 123 Regardless of this point, there is nothing in the scheme of the Act to suggest that by referring the matter to the Committee the Director failed to have regard to a mandatory consideration or had regard to an irrelevant consideration; BHL19 at [133]. Nor may it otherwise be concluded that the outcome of the Director's decision was legally unreasonable. Whilst it may be that other decision makers in the same position might differ in their approach to negotiating agreements, it cannot be said that the decision not to do so falls outside the range of decision freedom afforded to the Director under the scheme of the Act; BHL19 at [134]; Li at [109] (Hayne, Kiefel and Bell JJ). 124 Furthermore, I do not accept that the decision to refer the applicant to the committee was arbitrary or indicated a lack of regard for the purposes of s 89C(2) and s 92. No doubt one purpose of the scheme is to permit a practitioner and the Director to reach agreement as to specific action under s 92(2) and thereby, subject to ratification by the Determining Authority, circumvent a more protracted enquiry process. However, another purpose of the scheme, apparent from s 93 and the provisions concerning the conduct by a committee of its functions, is to enable the Director to engage the expertise of peers of a medical practitioner sitting in a committee to investigate further the conduct under review before recommending specific action. It was within the decisional freedom afforded to the Director to form the view that such a course was appropriate in the circumstances of the present case. 125 Accordingly, I do not consider that ground 2 has been established. 7. DISPOSITION 126 For the reasons set out above, the application for review must be dismissed. The applicant must pay the costs of the Commonwealth. I certify that the preceding one hundred and twenty-six (126) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Burley. Associate: Dated: 24 February 2023