THE ROYAL AUSTRALIAN COLLEGE OF OPHTHALMOLOGISTS v ROGERS AND ORS SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL GLEESON CJ, MAHONEY and SHELLER JJA 4 March 1992, 4 March 1992 [1992] NSWCA 217 INJUNCTION — appeal against injunction granted which restricted College of practitioners referring information of the behaviour of three of its members to the Medical Board — trial judge found College actuated by malice in its referral — evidence did not support such a serious finding of fact or any conclusion of abuse of power by the College. Briginshaw v Briginshaw (1938) 60 CLR 336 at 362 applied. Gleeson CJ The respondents to this appeal, who were the plaintiffs in the proceedings at first instance, are three medical practitioners who specialise as ophthalmologists. The appellant is the Royal Australian College of Ophthalmologists, a company limited by guarantee. Each of the respondents is a member of the College. The respondents, who were successful at first instance, obtained from Mr Justice Young, in the Equity Division of the Court, injunctive relief restraining the College from communicating certain information to the Medical Board. The terms of the injunction granted by his Honour were as follows: "The Court orders that defendant by its servants and agents be restrained from making or forwarding to the Medical Board of New South Wales any complaint or information against the plaintiffs relating to the publicity concerning the use of the excimer laser treatment." During the hearing of this appeal senior counsel for the respondents indicated that if they were otherwise successful they would seek a slightly different order. The order now sought is in the following terms: "The plaintiff by itself its servants and agents be restrained from carrying into effect any decision made by the appellant on or before 6 November 1991 to forward to the Medical Board of New South Wales the appellant's letters dated 29 October 1991 or 5 November 1991 and addressed to the Secretary, the Medical Board of New South Wales or any of the material contained in annexure A or referred to in para3 of the affidavit of Claire Alice Mirabello sworn on 6 November 1991 and filed in the proceedings under appeal." The background to the litigation may be summarised as follows. Medical practitioners are subject to ethical inhibitions in relation to personal advertising. The subject matter is covered, for example in Reg28 to Reg34A inclusive of the medical Practitioners Regulations 1981. During September 1991 the respondents were involved in some media publicity concerning certain new technology which was referred to in these proceedings as excimer laser treatment. The detail of that publicity and of the involvement in it of the respondents is not of present importance. Indeed I should emphasise that nothing I am about to say is intended to reflect any view, one way or the other, upon the propriety of the conduct of the 2 UNREPORTED JUDGMENTS respondents in relation to that subject matter. That is not an issue in these proceedings and there has been no attempt to investigate the detail of the facts relating to it. However, it is often the case that personal publicity attracted by members of a learned profession excites strong feelings on the part of other members of the profession. It appears that by early October 1991 the respondents had been made aware that some of their professional colleagues were complaining about their conduct. During October there was an exchange of communications between the parties and also between the legal representatives of the parties and it will be necessary in due course to consider the detail of those communications. For the moment it suffices to say that by late October or early November the College had taken a decision to write a letter to the Medical Board in the following terms: "The Council of the College has received a number of complaints relating to publicity during the period 9 and 10 September 1991 concerning the use of the excimer laser treatment by: Dr CM Rogers 66 Pacific Highway St Leonards 2065 Dr MA Lawless 1A Berry Road St Leonards 2065 Dr PRA Cohen 2/30 President Avenue Caringbah 2229 The Council requests the New South Wales Medical Board to determine whether a breach of the Medical Practitioners Act has occurred." It was evidently intended that the letter would be accompanied by details of newspaper articles and transcripts of media interviews which constituted the publicity referred to in the letter. It was that proposed communication that was the subject of the injunction granted by Mr Justice Young. Before I come to the reasons for judgment of his Honour I should make reference to certain other background matters. The College has as one of its objects the following: "To cultivate and maintain high principles and standards of practice and ethics in relation to ophthalmology and related sciences and branches of medicine and to promote fair honourable and proper practice and to discourage and suppress malpractice or misconduct and to settle questions of practice and of professional usage and etiquette." Under its Articles of Association the College has the power, itself, to undertake disciplinary proceedings and action in relation to complaints against its members. However, the evidence shows, and it is common ground, that there was no attempt on the part of the College to undertake any disciplinary proceedings itself against the respondents. Rather, the College decided to refer the entire matter to the Medical Board. The New South Wales Medical Board is constituted by s5 of the Medical Practitioners Act 1939 as amended. S28 of the Act deals with complaints against registered medical practitioners including complaints to the effect that a practitioner has been guilty of professional misconduct. The College has not made a complaint against the respondents pursuant to the provisions of s28. S28 sub3 provides the procedure to be followed in relation to making a complaint and that procedure provides, UIRKE ROYAL AUSTRALIAN COLLEGE OF OPHTHALMOLOGISTS v ROGERS AND ORS (Gleeson CJ) amongst other things, that complaints are to be in writing, to be supported by appropriate particulars and to be verified by statutory declaration. It is common ground that what is involved in the present case is not a complaint by the College against the respondents. On the other hand, s28 contemplates in its terms that complaints against a registered medical practitioner may be made by the Board and it is also common ground that, under the provisions of the Act, persons may communicate information to the Board which may itself undertake inquiries and ultimately decide, on the basis of that and any other relevant information, to make a complaint itself. That seems to be the procedure that the College was setting out to follow in the present case. S31 of the Act provides that if the Board decides to make a complaint it shall then refer the complaint to a committee or a tribunal pursuant to the provisions of the Act. The case for the respondents, in the first instance, was put upon the basis that, whilst the College undoubtedly has the power to consider questions of the propriety of the professional conduct of its members and, in an appropriate case, to ref er a matter to the Medical Board, nevertheless in the present case what the College was threatening to do constituted an abuse of power and, in particular, an exercise of its power for a collateral purpose. That is the argument that succeeded at first instance. On this appeal the respondents put a further argument in support of the orders made at first instance, being an argument that was not put to Mr Justice Young. That was an argument to the effect that the conduct of the College was oppressive or unfairly prejudicial to or fairly discriminatory against the respondents contrary to the provisions of s260 of the Corporations Law. I will put that submission to one side for the moment and deal first with the argument that was successful below. Mr Justice Young found as a fact, on the basis of the evidence before him, that the College was acting maliciously and for a collateral purpose. It will be necessary to examine in detail the evidence which formed the basis of that finding. I should, however, first set out the finding of fact which his Honour made: "T would infer that the fact that the council has written on its letterhead and made this request is an attempt, short of making a complaint, short of putting in statutory declarations to support the complaint, to put pressure on the Medical Board to itself bear the cost of dealing with the complaint or more likely, the council directed its mind to the question as to whether there were grounds for complaint against the plaintiffs, could not determine that there were any, would not be prepared to make any statutory declarations, and, accordingly, thought that some more or less anonymous request would serve its purpose. It is significant that the names of the persons making the so-called number of complaints were never disclosed to the Medical Board, that they were never disclosed to the court, that no member of the council felt that it would be appropriate for those persons to divulge their names to the court, or for any minutes of the council to be put before the court. Added to the inference that must be drawn from the reneging on the undertaking, it would appear to me that there is only one fact that I could find and that is that the council has taken a view that there is no proper complaint to be made against the plaintiffs, but out of malice has determined to denigrate the plaintiffs in the public eye." 4 UNREPORTED JUDGMENTS Before referring to the evidence on the basis of which that finding was made I should pause to reflect upon its seriousness. The finding is a finding to the effect that, well knowing there is no justifiable cause of complaint against the respondents, the respondents are threatening to communicate with the Medical Board out of malice and pursuant to a determination to denigrate the plaintiffs in the public eye. That proposition was elaborated in argument on this appeal as meaning that the College was making itself an instrument of jealous vindictiveness on the part of some of its members. if that were true the conduct of the office bearers of the College in question in these proceedings would, I should have thought, be far more serious than the conduct which has given rise to the complaints against the respondents. The finding of fact that his Honour has made, and which the respondents support in this appeal, is one of the utmost seriousness. In Briginshaw v Briginshaw (1938) 60 CLR 336 at 362 Sir Owen Dixon said: "The seriousness of an allegation made, the inherent unlikelihood of an occurrence of a given description, or the gravity of a given description, or the gravity of the consequences flowing from a particular finding are considerations which much affect the answer to the question whether the issue has been proved to the reasonable satisfaction of the tribunal. In such matters 'reasonable satisfaction' should not be produced by inexact proofs, indefinite testimony, or indirect inferences. Everyone must feel that, when, for instance, the issue is on which of two dates an admitted occurrence took place, a satisfactory conclusion may be reached on materials of a kind that would not satisfy any sound and prudent judgment if the question was whether some act had been done involving grave moral delinquency." The allegation against the College in the present case is an allegation of grave moral delinquency. I will turn now to a consideration of the detail of the evidence, bearing in mind the principles which I have just stated. There was no oral evidence in the proceedings at first instance. The totality of the evidence, on which his Honour's finding was based, was as follows. On 3 October 1991 the three respondents wrote a letter to the State Chairman of the College. The opening paragraph of the letter referred to the fact that there had been communication between the College and the authors of the letter and it seems that the officers of the College had drawn the attention of the respondents to the fact that some members of the College were complaining about the publicity to which I have earlier made reference. The letter went into a detailed explanation of the circumstances of the publicity and a justification of the conduct of the respondents. As I have said I make no comment upon the strength of that justification. It is, however, not without importance to notice some of its aspects. Detailed factual matters relating to the circumstances of the publicity were considered and those factual matters included references to communications that had taken place between the respondents and officers of the College in relation to the publicity at a time when it was being mooted. The respondents were justifying their conduct on grounds that included reference to information that they had received and expressions of attitude that had been made by the representatives of the College. The College itself, therefore, might well have felt that its own conduct and the conduct of its officers was being in some way raised as a matter relevant to the conduct of the respondents. The letter of the respondents included the following paragraph: URE ROYAL AUSTRALIAN COLLEGE OF OPHTHALMOLOGISTS v ROGERS AND ORS (Gleeson CJ) "We are aware of the strong feeling of some of out colleagues about the events surrounding the excimer laser media release. The method of the medial release was not something organised by us and the unprecedented media response was a surprise to us." About a week later the respondents wrote a further letter to the College in the following terms: "We have all now had a chance to persue the (College) bylaws. Whilst at the time we thought we were acting ethically by speaking to the media on behalf of the Mater Hospital, the College bylaws appear to allow media interviews only if the direct permission of the (College) president or secretary is obtained. We apologise if there was a breach of bylaws and assure you this will not happen again." On 21 October 1991 a firm of solicitors acting for the respondents wrote to the College. The solicitors said they had reason to believe that the governing body of the College had received complaints about the respondents and that the complaints may have been actuated by malice. Concern was expressed for the reputation and standing of the respondents and the respondents were asked to give an undertaking not to refer the matter, or complaint, to any person or authority including the Medical Board until such time as the respondents had been afforded an opportunity to be heard. At that stage Messrs Blake Dawson Waldron were acting as solicitors for the College. It seems that the undertaking requested was given because on 30 October 1991 the respondents' solicitors wrote to Blake Dawson Waldron in the following terms: "We confirm the arrangements then made between us on behalf of our respective clients and for the purpose of affording you a reasonable time to obtain complete instructions that, for the consideration of our clients during that period refraining from taking any action of the nature foreshadowed in the final paragraph of our letter aforesaid, your client undertook not to make any complaint about or reference of the matter to any person or authority without prior notice to us. In this respect we note also your advice that no such complaint or reference had previously been made." On 31 October 1991 Blake Dawson Waldron wrote to the solicitors for the respondents in the following terms: "We attach a copy of a letter from our clients to the Medical Board of New South Wales. We have instructions to arrange for that letter to be lodged with the Medical Board of New South Wales on Monday 4 November 1991. This information is given to you in fulfilment of our client's undertaking given to you on 23 October." The letter referred to was substantially the same letter as the letter to the Medical Board which I have quoted in an earlier portion of this judgment. The evidence shows that on 1 November 1991 Mr Magarey of Blake Dawson Waldron telephoned the respondents, solicitors and gave an undertaking not to take any further action before close of business on Wednesday 6 November 1991. At about 9.15 am on 4 November 1991 a solicitor named Mr Heinrich of Tress Cocks and Maddox, Solicitors, telephoned the respondents, solicitors and informed them that Tress Cocks and Maddox taken over the conduct of the matter from Blake Dawson Waldron. Mr Heinrich said: I am instructed to inform you that the undertaking given to you Blake Dawson Waldron on Friday is withdrawn and that the College proposes to forward its letter to the Medical Board tomorrow." 6 UNREPORTED JUDGMENTS That is the whole of the relevant evidence. The communication that I have just quoted is the action referred to by Mr Justice Young as '.reneging. I find it impossible to accept the view that his Honour took of the conduct of the College in this respect. Prior to 1 November 1991 it was known to all parties and their solicitors that the College was intending to send to the Medical Board the letter quoted above. It was also known to the parties that the respondents, through their solicitors, were threatening to seek injunctive relief to restrain sending of the letter. On 1 November the solicitors who were then acting for the respondents undertook not to send the letter until the close of business on Wednesday 6 November. On 4 November at 9.15 am the new solicitors for the College gave twenty-four hours notice of the intention to send the letter. They withdrew the undertaking that had been given by Blake Dawson Waldron and said that the College proposed to forward the letter on 5 November. The obvious purpose of that communication was to enable the respondents to seek injunctive relief, and that is exactly what the respondents did. There is no suggestion that the time given to the respondents to enable them to seek temporary injunctive relief was inadequate and, in the events that transpired, it was shown not to be inadequate. In his reasons for judgment Mr Justice Young, when referring to what he called "the act of reneging" on that undertaking, said this: "T put to counsel for the defendant that the only inference I could draw would be one of malice, and counsel was not able to think of any other explanation." We were told on this appeal that there must have been some misunderstanding between his Honour and counsel in relation to that recorded concession. I find it surprising that his Honour felt able to draw the inference of malice from the conduct to which I have just referred, let alone that his Honour felt it to be the only inference available. In this connection it is important to be clear as to what his Honour meant by "malice". The remainder of his judgment indicates what was meant. What his Honour meant by "malice" was a state of mind on the part of the College that there was no proper complaint that could be made out against the respondents, and a determination to denigrate the respondents in the public eye. The placing by a body such as the College before the Medical Board constituted under the Medical Practioners Act of information relevant to possible misconduct on the part of a medical practitioner hardly constitutes denigrating the medical practitioner in the public eye. It is for the Medical Board to carry out such inquiries as it thinks fit before deciding for itself whether or not to make a complaint. I have earlier mentioned that the justification of their conduct advanced on behalf of the respondents raised detailed questions of fact that could well have required further investigation and consideration before any judgment, even at a prima facie level, could properly be made about the conduct of the respondents. I have also referred to the fact that the justification advanced by the respondents made reference to conduct on the part of officers of the College. I would have thought that an inference at least equally consistent with the evidence was that the College decided that, in all the circumstances, it was a matter that was more appropriate for investigation and further consideration by the Medical Board than by the College itself. The withdrawal, or perhaps to put it more accurately, the variation, of the undertaking, was made in circumstances that gave the respondents time to approach the Court for injunctive relief, as in fact they did. UIRKE ROYAL AUSTRALIAN COLLEGE OF OPHTHALMOLOGISTS v ROGERS AND ORS (Gleeson CJ) In my view the evidence did not justify the extremely serious inferences drawn by his Honour compare Dawson v Westpac Banking Corporation (1991) 66 ALJR 94. Reliance has been placed on behalf of the respondents on the circumstance that no evidence was given at the hearing - that is to say, the hearing before Mr Justice Young for final relief - by any officers of the College. In my view the evidence, entirely documentary as it was, that was led on behalf of the respondents fell so far short of making out a prima facie case of the allegation that the respondents were making that no conclusion of the kind now contended for can safely be based on the absence from the witness box of representatives of the College. I consider that the factual basis for the conclusion expressed by his Honour has not been made out. I turn now, briefly, to consider the alternative ground on which the respondent relies. There are no findings of fact made in relation to this matter because it was not argued below. As I have indicated reliance is placed upon s260 of the Corporations Law and it is submitted that the conduct of the appellant would be oppressive or unfairly prejudicial to or unfairly discriminatory against the respondents. The conduct involved is communicating information to the Medical Board. The Medical Board is a statutory authority which has functions and obligations under the Medical Practitioners Act and this Court may safely infer that it will discharge those functions in accordance with its statutory obligations. It may well be that, upon investigation of the details and circumstances of the publicity in which the respondents were involved, the Medical Board may decide that there is no occasion to make any complaint against them. I express no view, one way or the other. Complaint is made on behalf of the respondents that the College is proposing to supply the Medical Board with the detail of the publicity but not with the detail of the explanation that was made to the College by the respondents of the circumstances of the publicity and their justification for their involvement in it. It may be that in this and other respects the respondents feel a sense of grievance - perhaps even a justifiable sense of grievance - that the College could have done more to obtain and represent to the Board both sides of the story. This, however, falls a long way short of any justifiable conclusion that the conduct on the part of the College was oppressive or unfairly prejudicial to or unfairly discriminatory against the respondents. Obviously the respondents will have a full opportunity to put to the Medical Board their side of the matter. The Board will presumably set about the discharge of its statutory functions and obligations in a manner that will secure substantial fairness to the respondents. Of course, it is an extremely unpleasant experience for any professional person to find his or her conduct even the subject of consideration or scrutiny by a body such as the Medical Board. However, in my view, the evidence does not support a finding adverse to the College that the conduct of the College falls within s260 of the Corporations Law. I should mention in conclusion that at the outset of these proceedings the Medical Board, by its counsel, sought to appear as amicus curiae and we were shown the submissions that the Board would seek to make if that leave were granted. In my view such leave should be declined. 8 UNREPORTED JUDGMENTS I would propose that the following orders should be made. The appeal should be allowed. The orders made by Mr Justice Young should be set aside. The respondents should pay the costs of this appeal and of the proceedings at first instance. The respondents, if otherwise so entitled, are to have a certificate under the Suitors' Fund Act. Mahoney JA I agree with what has been said by the Chief Justice. The appeal turns, of course, upon two matters, the nature of the wrongs alleged by the plaintiffs and whether the evidence supports the fact. that the wrongs were committed. I shall assume, for purposes only of this judgment, that the two wrongs - breach of fiduciary duty and oppression - would be wrongs if proved. But, in my opinion, the evidence does not establish that those wrongs were committed. I would not draw the kind of inferences which Mr Trew's arguments proposed and upon which his case relied. I would add only this. The decision in this case does not, I think, determine whether what the plaintiffs did was an offence under the Medical Practitioners Act, whether the College dealt with the plaintiffs in the best possible way, or whether the College, by sending the complaints to the Medical Board, dealt with them in the proper way, having regard to its position as a Royal College. These are matters on which it is not necessary for the Court to express an opinion. I agree with the orders proposed by the Chief Justice. Sheller JA These proceedings were initiated on the basis that in proposing to send a letter dated 5 November 1991 to the New South Wales Medical Board to determine whether a breach of the Medical Practitioners Act by the respondents had occurred, the counsel for the respondents were actuated by malice. His Honour drew an inference, from a notification given by the appellants that it withdraw an undertaking not to send the letter before the close of business on 6 November 1991, that the appellant was actuated by malice. For the reasons given by the Chief Justice I do not regard this inference as open. His Honour went on to draw the inferences and make the findings set out in the Chief Justice's judgment, the seriousness of which his Honour has analysed, an analysis with which I respectfully agree. Mr Justice Young, having drawn these inferences, said that the question was whether there was any power in the council to act maliciously against its members. He concluded: "Although the council is empowered under article 68(c) to do all the acts of the company, that power is given to the council to be exercised bona fide in the interests of the company as a whole. It is a fraud of that power, in my view, for the council to purport to exercise that power to be malicious against members, or where it says that there is no justifiable complaint which it can support in the ordinary way, to denigrate the members by making a back door complaint, if I can call it that, unsupported by particulars, unsupported by evidence and without the decency to inform the members complaint and give them the opportunity to put their case." The evidence has been set out in the judgment of the Chief Justice. Having regard to that in my opinion there was no evidence to support his Honour's conclusion that the council purported to exercise its powers under the articles to be malicious against members. Nor do I consider the pejorative language used by his Honour in the rest of the passage to be justified. In short, in my opinion, fraud on the power was not made out. Perhaps understandably Mr Trew QC who appeared for the respondents did not seek to support the findings of malice with URE ROYAL AUSTRALIAN COLLEGE OF OPHTHALMOLOGISTS v ROGERS AND ORS (Sheller JA) any enthusiasm. At most he said that, by reference to some documentary material, there was a suspicion that the council was motivated by ulterior considerations or acted to achieve ulterior ends. it hardly needs saying that, for allegations as serious as those so freely made by the respondents, more than suspicion is required. If the material referred to gave rise to suspicion, suspicion is not enough. For that reason the basis upon which his Honour made the orders he did substantially, if not entirely, collapse. Mr Trew, however, contended that the failure of the applicant to forward letters by the respondents of explanation and apology, or the failure to conduct an investigation itself, or the furnishing to the Medical Board of its own media release, or the failure to identify the complainants or furnish the complaints, or to make a complaint itself pursuant to s28 of the Medical Practioners Act, or the change in the form of the letter proposed to be sent from that originally drafted demonstrated, in the circumstances referred to, some unidentified ulterior purpose, or, alternatively, was oppressive or unfairly prejudicial to or discriminatory against the respondents calling for the Court to exercise its discretion under s260 of the Corporations Law. The onus was on the respondents to prove their case. In my opinion there is no evidence on the basis of which the Court could find any ulterior purpose or conduct falling within s260. For these reasons I agree with the orders proposed by the Chief Justice. Gleeson CJ: The orders of the Court will be as I previously said. Appeal allowed. Orders of Young J set aside. Respondents to pay costs of appeal and of proceedings at first instance. Respondents, if otherwise so entitled, to have a certificate under the Suitors' Fund Act. BYNES Counsel for the appellant: T Hughes QC/K Connor Solicitors for the appellant: Tress Cocks and Maddox Counsel for the respondent: JL Trew/AS Martin Solicitors for the respondent: Harrington Maguire and Co