Case Review (Misfeasance in public office): Kitchen v Quinlivan (No 3)

PLAINTIFF: Dr David Kitchen, ophthalmologist, and his practice CQ Eye Pty Ltd

DEFENDANT: Julie Quinlivan, Director of Professional Services Review Agency (PSR). The PSR agency administers the PSR Scheme to investigate Medicare-referred cases of possible inappropriate practice relating to Medicare, the CDBS and the PBS. Most commonly, the PSR agency investigates doctors suspected of "inappropriate practice" – billing Medicare incorrectly or excessively.

CLAIM: Misfeasance in public office. Misfeasance in public office is an intentional common law tort occurring when a public officer abuses their authority, causing foreseeable loss, with either malice or reckless indifference. It requires proving the officer acted in bad faith, knowing they lacked power or were harming the plaintiff.

ISSUE: A government official reviewing a doctor's Medicare billing receives the doctor's 96-page written response (plus 833 pages of annexures) at 3:48pm. At 4:05pm – just 17 minutes later – she emails saying she's decided to refer him for investigation. She later claims she'd already read everything over the weekend before receiving it. The doctor sues, arguing she never read his submission and destroyed his career through reckless disregard. Can he prove she lied?

The short answer: Yes. $1,986,300.66 awarded in damages.

Summary

Dr David Kitchen was a successful ophthalmologist in Central Queensland. In 2018, Medicare suspected he was billing inappropriately and the Professional Services Review (PSR) agency started investigating.

On 29-30 October 2018, Dr Kitchen's lawyers sent his detailed written response to the PSR:

• 96-page main submission
• 207 written annexures (833 pages)
• 2 video file annexures
• Total: 929 pages

The submission addressed every concern Medicare raised about his billing practices.

A PSR staff member emailed the PSR Director (Quinlivan) a summary of Dr Kitchen's 929 page submission, and just 17 minutes later Director Quinlivan replied: "I have decided to refer [Dr Kitchen] to a committee".

That's just 17 minutes to read, consider, and decide on a substantial submission that would destroy a doctor's career.

Why a PSR referral is devastating

If the PSR committee finds "inappropriate practice" the Director can fully disqualify the doctor from Medicare billing. In Australia, this effectively ends your medical career because:

• 85%+ of patients use Medicare
• Without Medicare billing, patients must pay full price out of pocket
• No one can afford to pay thousands per consultation/surgery
• Your practice becomes economically unviable overnight

Even while under investigation (before any finding), doctors face:

• Years of hearings and legal battles
• Hundreds of thousands in legal costs
• Cancelled appointments to attend committee hearings
• Professional reputation destroyed
• Patients leaving because their doctor is "under investigation"
• Massive stress affecting clinical work

What actually happened to Dr Kitchen

After the PSR investigation, the Director fully disqualified him from billing Medicare – his ophthalmology practice effectively shut down. He only got this reversed after years of Federal Court litigation.

The Director's Story:

Quinlivan claimed:

• She'd been given printed copies of the submission the previous weekend
• She read all 96 pages and most of the 207 annexures at home over the weekend
• She made handwritten notes and highlighting throughout
• By the time she got the email, she'd already made her decision
• The 17 minutes was just a coincidence

The Doctor's Nightmare:

The referral triggered:

• Years of PSR investigations and committee hearings
• Committee hearings in Brisbane (Dr Kitchen lived in Rockhampton – constant travel)
• Full disqualification from Medicare billing – his practice effectively shut down
• Massive legal costs (over $1 million)
• Cancelled appointments and surgeries over years
• Professional humiliation
• Damage to his reputation
• Patients leaving his practice

The Federal Court Case:

Dr Kitchen sued in Federal Court for judicial review following the referral. Critically, the Director consented to a court declaration that she "did not take into account" Dr Kitchen's submission contrary to her legal duty under s 89C of the Health Insurance Act 1973 (C'wlth).

This admission became crucial evidence in the later damages case.

The Misfeasance Trial

Following the Federal court case, Dr Kitchen then sued for misfeasance in public office – a serious tort requiring proof that Quinlivan either:

1. Intended to harm him (targeted malice), OR
2. Knowingly acted beyond her power with reckless indifference to the harm she'd cause

Why the Court Didn't Believe Her:

The judge systematically demolished Quinlivan's story:

1. The 17-Minute Timeline:

• No human can meaningfully read and consider 96 pages in 17 minutes
• Even if she'd read it before, 17 minutes isn't enough to refresh memory and make such a serious decision

2. No Documentary Trail:

• No printing records (she claimed IT systems were replaced and records lost)
• No one could confirm the documents were printed
• She called no IT staff, no finance staff to corroborate the server replacement story

3. The "Lost" Working File:

• Claimed she made handwritten notes and highlighting throughout the submission
• These documents conveniently "disappeared" – allegedly taken by some unnamed employee who shredded them
• Never produced despite being critical evidence

4. No Witnesses:

• Claimed "specialist printing and collating officers" printed documents for her
• Never called any of them to testify
• No case manager confirmed printing it

5. Contradicted by PSR's Own Practices:

• PSR staff emails showed standard practice: junior staff prepare summary, Director reads summary
• Email from staff member: "We could show Julie these documents on the R drive when it comes time for her to review them" – suggesting she hadn't seen them yet
• No evidence this case was treated differently

6. Jones v Dunkel Inference:

• The court drew adverse inferences from Quinlivan's failure to call witnesses who could have corroborated her story
• If the evidence existed, why not call these people?

7. The Federal Court Declaration:

• She'd already admitted in Federal Court she "did not take into account" the submission
• Now claiming she did read it was trying to have it both ways

Court's Decision – Misfeasance Proven

The judge found Quinlivan committed misfeasance in public office through reckless indifference:

What She Did:

• Received a 929-page submission
• Made a career-destroying decision 17 minutes later
• Either didn't read it at all, or didn't genuinely consider it
• Showed reckless indifference to whether she had the power to act
• Showed reckless indifference to the devastating harm she'd cause

The Legal Standard:

The judge explained: Misfeasance in public office requires proving the official acted with "reckless indifference or deliberate blindness" to:

1. Their lack of power to do what they did, AND
2. The likely injury their action would cause

Quinlivan met both elements. She had no power to refer Dr Kitchen without genuinely considering his submission. She was recklessly indifferent to whether she had that power and to the destruction it would cause his career.

Damages were awarded to Dr Kitchen as follows:

• General Damages: $50,000
• Exemplary Damages: $100,000
• Loss of Income: $1,347,500 (including interest)
• Expenses: $80,730
• Legal Costs: $408,070
• Total: $1,986,300.66

KEY LESSONS:

1. Timing Matters: When someone claims they carefully considered voluminous material but the timeline shows only minutes between receiving and deciding, courts will be extremely sceptical.
2. Missing Documents Are Fatal: Claiming critical documents existed but mysteriously disappeared without calling witnesses to explain it will destroy credibility.
3. Jones v Dunkel Cuts Deep: Failing to call obvious witnesses who could corroborate your story leads courts to infer their evidence wouldn't help you.
4. Prior Admissions Bind You: If you've already admitted something in earlier court proceedings (here, not taking the submission into account), you can't contradict it later.
5. Misfeasance Requires Bad Faith: Not just negligence – requires proof of reckless indifference or knowing misconduct. The 17-minute timeline + missing documents + no witnesses = reckless indifference proven.
6. Power Must Be Exercised Properly: Public officials with power over professionals' careers must exercise that power "cautiously, thoughtfully and sparingly." Quinlivan did none of those things.
7. Commonwealth Can Be Hit Hard: The nearly $2 million award (including $100k exemplary damages) sends a message: abuse of government power has serious financial consequences.

Dr Kitchen spent years of his life and over $1 million in legal costs fighting to clear his name. While he won $1.98 million in damages, he can't recover the hundreds of hours of early mornings, late nights, and weekends wasted responding to an investigation that should never have happened.

Quinlivan's 17-minute decision destroyed a doctor's career and cost the Commonwealth nearly $2 million dollars. All because she couldn't be bothered to actually read what he'd written before pulling the trigger.

When exercising power over someone's livelihood, actually read their response before destroying their career. If you claim you did but can't prove it, a court may award millions in damages for misfeasance in public office.

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

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