Natural Justice And Professional Services Reviews

On 19 December 2025 the Supreme Court of Queensland held that previous Director of the Professional Services Review Agency (PSR), Professor Julie Quinlivan, committed misfeasance in public office¹ when she failed to consider the submissions of a person under review before referring them to a PSR Committee under section 93 of the Health Insurance Act 1973 (Cth).

In issue

• This judgment of Justice Treston of the Supreme Court of Queensland, delivered on 19 December 2025, concerns allegations of misfeasance in public office against the then Director of the Professional Services Review Agency (PSRA), Professor Julie Quinlivan (the Director).
• It arises out of the Director's referral of the first plaintiff, Dr David Kitchen, to a Committee investigation without properly considering his submissions on matters relevant to that investigation, as required under section 89C(2) of the Health Insurance Act 1973 (Cth) (the Act).
• As Her Honour observes, this is not a commonly litigated tort given the requirement to establish that the public officer knowingly acted in excess of their power or with reckless indifference to its invalidity and the harm it would cause.

Background

Review of Medicare services

Dr Kitchen was an ophthalmologist practising in regional Queensland who, in 2017, became the subject of a review of his Medicare billing practices.

The concerns raised by the Department of Health related to MBS items for specialist consultations and ophthalmology procedures. One of the Director's key concerns was that patients were seen and booked for surgery before being consulted by Dr Kitchen.

In June 2017, Dr Kitchen received a letter from the Department of Health informing him that he was required to attend an interview pursuant to the Practitioner Review Program. At this interview, an unintentional error was brought to Dr Kitchen's attention in relation to incorrectly billing patients. In September 2017, he submitted a Voluntary Acknowledgment of Incorrect Payments and later repaid circa $66,000 in benefits to the Department of Health.

Following that repayment, the Director of the PSRA was asked by the Chief Executive Medicare to investigate Dr Kitchen's provision of Medicare services between 1 February 2016 and 31 January 2017. Consistent with usual processes, Dr Kitchen produced requested patient records to the PSRA, and he (and his solicitors and practice manager) met with the Director on 31 July 2018 at his rooms in Rockhampton. Dr Kitchen reported that the Director had snickered and laughed at him during the meeting and commented to the effect that 'well that will be one for the committee'.

On 16 August 2018, Dr Kitchen received a letter from the PSRA which attached the Director's Report. The letter set out reasons why the Director had not made a decision to take no further action, and invited Dr Kitchen to make submissions within one month about the action(s) which the Director should take. On 29 and 30 October 2018, Dr Kitchen submitted a detailed 96-page response with 205 annexures to address the concerns raised in the Report.

Amongst other things Dr Kitchen submitted that:

• all histories, testing and clinical documentation were taken by qualified, trained and competent clinical assistants, and that he always checked reviewed and confirmed this information and made changes when required
• he always performed his own examinations, and
• he covered all individual risks as part of his consent process and the detail that was put into his cataract 'work ups' would be unparalleled by his peers.

Dr Kitchen's submissions were supported by information contained in the 205 annexures.

In terms of an outcome, Dr Kitchen submitted that if the Director decided not to take no further action, then a negotiated agreement should be entered.

Under section 89C(2) of the Act, the Director must consider the practitioner's submissions when deciding whether to take no further action, enter into an agreement, or make a referral to a committee for further investigation.

On 14 November 2018, the Director advised Dr Kitchen that she had exercised the power conferred on her by section 93 of the Act to establish a committee to further investigate his Medicare servicing (the Referral).

Federal Court Proceedings

On 1 February 2019, Dr Kitchen's solicitors wrote to the PSRA advising that he would be applying to the Federal Court for judicial review of the Referral decision. These proceedings were commenced on 13 November 2019.

The proceedings were initially defended and the Committee investigations continued. Dr Kitchen was required to attend numerous hearings before the Committee throughout 2019.

An application for an injunction to stop the Committee hearings was refused, and when Dr Kitchen then failed to appear at a Committee hearing the following day, the Director disqualified him from access to the Medicare scheme.

Following disclosure being made in the Federal Court proceedings, it was established that Dr Kitchen's submissions were emailed to the Director on 6 November 2018 at 4:05pm along with a summary prepared by a PSR case officer, and that the Director responded 17 minutes later to an internal employee saying, 'I'm establishing a Committee for this matter'.

In February 2021, the Director consented to a declaration that in making the referral she 'did not take into account' the 2018 submissions, and hence the Referral was void and of no effect. The Director was ordered to pay Dr Kitchen's costs.

The Supreme Court proceedings

The plaintiffs, Dr Kitchen and his practice, CQ Eye Pty Ltd, subsequently brought proceedings in the Supreme Court of Queensland contending that the Director had committed the tort of misfeasance in public office as she knew that she had not considered his submissions before making the Referral.

The Director gave evidence that before the submissions had been emailed to her, she recalled reading the submissions which had been printed for her.

Her Honour noted the lack of corroborative evidence and found that the evidence which the Director sought to give regarding the extent to which she says she had read Dr Kitchen's submission was inadmissible, due to the declaration made in the Federal Court that the Director 'did not take into account the applicant's submission'.

The Court found that it was highly unlikely that there was sufficient time for the Director to give proper, genuine and realistic consideration to Dr Kitchen's submissions before making the Referral. In doing so, the Director 'either, knowingly acted in excess of her power or acted with reckless indifference or deliberate blindness to the invalidity or lack of power... and to the harm that was likely to ensue'.

There was held to be an absence of any honest attempt to perform the functions of her public office, which constituted an abuse of process. Accordingly, Her Honour held that the Director committed misfeasance in public office when she made the Referral.

The Court awarded tortious damages to Dr Kitchen and his practice to compensate for the loss and damage arising from the misfeasance, which totalled $1,986,300.66. These included:

• $1,347,500 for loss of income (including interest) due to cancelled consults, cancelled clinics and surgery sessions arising out of involvement with the Federal Court proceedings and the Committee hearings
• $80,730.43 for expenses incurred during the committee investigation and Federal Court proceedings
• $408,070.23 for legal costs
• $50,000 for general damages for humiliation, embarrassment, and damage to professional reputation, and
• $100,000 for exemplary damages due to the Director's high-handed and reckless conduct.

Implications for you

Medicare audits and investigations conducted by the Practitioner Review Program and PSRA can have significant outcomes for healthcare professionals, including repayment of Medicare benefits, disqualification from the MBS, PBS and/or CDBS, as well as considerable stress and time away from work.

The best advice to avoid becoming involved in such a process remains preventative; health professionals should have systems in place to ensure that they achieve compliance with Medicare requirements including accurate billing and prescribing, and robust contemporaneous documentation, to avoid triggering an audit or investigation.

If healthcare professionals do come under investigation, then the submissions and information which they disclose, and the co-operation which they provide is critical, and they should be aware of their rights and the responsibilities of the reviewer, including their right to natural justice and the expectation that their responses will be genuinely considered.

Where there has been no, or no genuine consideration of submissions and information provided by them in an audit or investigation, then decisions made by the Director (or others) may be impugned, and the issue of compensation raised.

Kitchen v Quinlivan (No 3) [2025] QSC 351

Footnote

¹ Misfeasance in public office is an intentional tort recognised by the common law. It applies to holders of a public office who exercise their power in an invalid or unlawful way with either an intention to cause harm or reckless indifference to the likelihood of harm. The exercise of power must also cause loss.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.