N5227

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

OS (JR) NO 669 OF 2012

DR AMOS LANO
Plaintiff

V

DR MARU GARO, TEAM LEADER
First Defendant

PASCOE KASE, SECRETARY, DEPARTMENT OF HEALTH
Second Defendant

HON MICHAEL MALABAG MP,
MINISTER FOR HEALTH & HIV/AIDS
Third Defendant

THE INDEPENDENT STATE OF PAPUA NEW GUINEA
Fourth Defendant

Waigani: Cannings J
2013:24, 26 April, 29 May

JUDICIAL REVIEW – suspension of acting Chief Executive Officer of public hospital – whether Minister has power of suspension in absence of management board – Public Hospitals Act 1994 – Regulatory Statutory Authorities (Appointment to Certain Offices) Act 2004.

The plaintiff had for four years been acting Chief Executive Officer of a public hospital. He sought judicial review of the decision of the Minister for Health & HIV/AIDS to suspend him indefinitely. The ground of review relied on was that the Minister exceeded his jurisdiction in that he had no power to suspend the plaintiff, only the Board of the hospital could do that. The Board, however, had no members. The defendants argued that by necessity it was proper and lawful for the Minister to assume the powers of the Board.

Held:

(1)	The Public Hospitals Act 1994 provides that for each hospital declared under the Act to be a public hospital there shall be a Chief Executive Officer whose manner of appointment, suspension and dismissal is as specified in the Regulatory Statutory Authorities (Appointment to Certain Offices) Act 2004.

(2)	The manner of suspension prescribed by Section 8 of the Regulatory Statutory Authorities (Appointment to Certain Offices) Act is that the hospital Board causes an investigation into the CEO's conduct and advises the Minister to recommend to the National Executive Council that the CEO be suspended which then if it approves the recommendation of the Minister advises the Head of State to suspend the CEO.

(3)	That procedure was not followed here as there was no Board to initiate the process and the Minister acted unilaterally by not making any recommendation to the National Executive Council.

(4)	In an emergency, which was a case of administrative necessity, the Minister might be able to lawfully avoid the statutory procedures and act unilaterally as he did here but the present case could not be described as an emergency or a case of administrative necessity as the appointment of board members had lapsed a number of years ago and the Minister was responsible for their appointment.

(5)	The fact that the plaintiff held the position of CEO in an acting capacity did not relieve the Minister of the obligation to follow the law.

(6)	The Minister exceeded his jurisdiction and his suspension of the plaintiff was declared unlawful and was quashed.

Case cited

The following cases are cited in the judgment:

John Napi v Kundiawa General Hospital Board (2006) N3047
SCR No 1 of 1982; Re Phillip Bouraga [1982] PNGLR 178
Sister Orpah Tuga v Sasa Zibe (2011) N4261
Waguo Goiye v Dr Clement Malau (2011) N4377

JUDICIAL REVIEW

This was a review by the National Court of the decision of the Minister for Health & HIV/AIDS to suspend the acting Chief Executive Officer of a public hospital.

Counsel

D S Koeget for the plaintiff
M Koimo for the defendants

1.	Cannings J: The plaintiff Dr Amos Lano applies for judicial review of the decision of the Minister for Health & HIV/AIDS Hon Michael Malabag OBE MP to suspend him indefinitely as acting Chief Executive Officer (CEO) of Daru Public Hospital. The plaintiff relies on one ground of review: that the Minister exceeded his jurisdiction as he had no power to suspend him, only the hospital board could do that. The board, however, had no members. The defendants argued that by necessity it was proper and lawful for the Minister to assume the powers of the board and act accordingly.

HOW IS THE CEO OF A PUBLIC HOSPITAL SUSPENDED?

2.	Daru Public Hospital has been declared a public hospital for the purposes of the Public Hospitals Act 1994 so it must under Section 4(2) "be administered and maintained in accordance with this Act". It must have a CEO by virtue of Section 22(2) of the Public Hospitals Act, which states:

There shall be a Chief Executive Officer for each public hospital whose manner of appointment, suspension and dismissal is as specified in the Regulatory Statutory Authorities (Appointment to Certain Offices) Act 2004.

3.	In normal circumstances the CEO of a public hospital can only be suspended by following the procedure prescribed by Section 8 of the Regulatory Statutory Authorities (Appointment to Certain Offices) Act 2004:

•	the hospital Board causes an investigation into the CEO's conduct;

•	the Board advises the Minister to recommend to the National Executive Council that the CEO be suspended;

•	the Minister makes the recommendation to the National Executive Council;

•	if it approves the recommendation the National Executive Council advises the Head of State (in practice, the Governor-General) to suspend the CEO;

•	the Governor-General suspends the CEO.

WAS THE MINISTER'S DECISION JUSTIFIED BY SPECIAL CIRCUMSTANCES?

4.	Normal circumstances did not exist in the present case as there was no board in place and the plaintiff was not holding office in a substantive capacity. Does that justify the breach of procedure that occurred? Mr Koimo for the defendants submitted that it provides ample justification for the Minister's actions which were taken in good faith in response to a petition from staff at the hospital urging him to act quickly in the interests of the patients who were suffering due to maladministration by the plaintiff. Mr Koimo conceded that if Daru Public Hospital did have a Board the Minister would have acted unlawfully by unilaterally suspending the plaintiff. But there was no board so it was in the public interest and proper for the Minister, being politically responsible for all public hospitals, to assume the powers of the board.

5.	I reject that submission, though not absolutely and not because it is a completely unreasonable proposition. I think it is reasonable to read the Public Hospitals Act and the Regulatory Statutory Authorities (Appointment to Certain Offices) Act together and arrive at the conclusion that in an emergency situation, in the case of administrative necessity, it would be proper for the Minister to assume the role of the Board if for some extraordinary and justifiable reason a Board had ceased or refused to function.

6.	However that was not the case here. The evidence shows that Daru Public Hospital has not had a Board in place for more than four years. The appointments of all previous Board members have been revoked or lapsed in some other way. No good reason has been advanced to the court for not appointing a new Board and it can only be presumed that this state of affairs has come about due to administrative neglect. 'Who is responsible for the appointment of the board?' is the question that must be asked. The answer is provided by Section 10 of the Public Hospitals Act. The nine members of each board are appointed by the Governor-General on the advice of the National Executive Council acting on the nomination by the Minister. Put simply the Minister is responsible for the appointment of the Board. In this case he cannot use the fact that there was no Board in place as an excuse for assuming the powers of the Board as he is the person responsible for there being no board. This is not the sort of emergency or case of administrative necessity that would warrant the Minister assuming the powers of the Board.

7.	What about the fact that the plaintiff was not the substantive holder of the office? He was only an acting CEO and had acted in the position for four years. Again it seems extraordinary that such a state of affairs existed for so long but those are the facts so does that mean the procedure in Section 8 (suspension of a chief executive officer) of the Regulatory Statutory Authorities (Appointment to Certain Offices) Act could be bypassed?

8.	This is difficult to immediately answer with exactitude as an important document is missing from the evidence: the plaintiff's instrument of appointment. It should show who appointed him (it should have been the Governor-General in accordance with the merit-based appointment procedure in Part II of the Regulatory Statutory Authorities (Appointment to Certain Offices) Act and the term of his appointment. I am going to presume on the basis of the best evidence available that the plaintiff was properly appointed on an acting basis for an indefinite period, in which case the presumption arises that the procedure set out in the Act for suspension of the substantive holder of the office applies equally to the person who holds office in an acting capacity: the Board must initiate the process by investigating the conduct of the acting CEO, the Board then advises the Minister who recommends to the NEC who advises the Governor-General who suspends the acting CEO.

9.	I must say that this seems to be an unnecessarily elaborate procedure but in the present case it was necessary as a matter of law that it be followed. I therefore uphold the plaintiff's ground of review and find that the Minister exceeded his jurisdiction by unilaterally suspending the plaintiff without following the procedure in Section 8 of the Regulatory Statutory Authorities (Appointment to Certain Offices) Act.

COMMENTS

10.	The Minister exceeded his jurisdiction and it follows that his suspension of the plaintiff will be declared unlawful and quashed. I will make the appropriate declarations and orders but before doing so I need to comment on a number of matters. I reiterate that it is extraordinary that for four years Daru Public Hospital has had no substantive CEO and no Board. Under the Public Hospitals Act the CEO and the Board of a public hospital each have critical roles and are required to work with each other in administering and maintaining the hospital. The National Court has referred to the importance of these offices and bodies in a number of cases, eg John Napi v Kundiawa General Hospital Board (2006) N3047 (Davani J), Sister Orpah Tuga v Sasa Zibe (2011) N4261 (Makail J) and Waguo Goiye v Dr Clement Malau (2011) N4377 (Makail J). The functions of the CEO are prescribed by Section 23, which states:

(1)	The Chief Executive Officer of a public hospital appointed under Section 22(2)—

(a)	is the Chief Executive of the public hospital for which he is appointed; and

(b)	shall manage and direct the affairs of that public hospital; and

(c)	in relation to the management of that public hospital and the direction of its affairs, shall act in accordance with the policies determined by the Board of that public hospital.

(2)	The Chief Executive Officer of a public hospital has such other functions as the Board of that public hospital may from time to time determine.

11.	The Board has a wide range of powers and functions spelt out in Sections 7 and 8, which state:

7.	Functions of Boards.

(1)	Subject to the National Health Administration Act 1997, a Board has, in respect of the public hospital for which it is established, the following functions—

(a)	to administer and maintain the public hospital and its facilities for the care and treatment of the local people; and

(b)	to engage in and assist local authorities in the provision of community health education and public health information services to local communities; and

(c)	to provide or assist in the provision of facilities for, or in connection with, education, instruction or practical training of its professional staff and other employees; and

(d)	to disseminate information and knowledge in the field of public health for the benefit of the public; and

(e)	to provide facilities for teaching, instruction, research or post-graduate studies in medicine, dentistry, obstetrics, paediatrics, surgery, ophthalmology, pathology, psychiatry, radiology, oncology and other related fields as the Board may consider fit; and

(f)	to encourage research and experimentation into any areas of health services, medical activities or paramedical activities; and

(g)	to administer and expend money appropriated by the State for the purposes of the public hospital; and

(h)	to consult and co-operate with appropriate authorities and with other organizations, associations and persons on matters related to its activities; and

(ha)	to supervise, assist and monitor curative services provided by lower level health facilities and to support their operations; and

(i)	generally to do such supplementary, incidental or consequential acts and things as are necessary and convenient for carrying out or giving effect to its functions.

(2)	The Board of a public hospital may perform any of its functions in co-operation with the Provincial Government of the province in which the public hospital is situated or with any body established by that Provincial Government for the purpose of encouraging the provision of health services in the province.

8.	Powers of Boards.

Subject to the National Health Administration Act 1997, a Board has, in respect of the public hospital for which it is established, power to do all things necessary or convenient to be done for or in connection with the performance of its functions, and, in particular, may—

(a)	enter into contracts; and

(b)	occupy, use, control or otherwise deal with land or buildings owned or held by the State and made available for the purposes of the public hospital; and

(c)	in consultation with the Department responsible for health matters, recommend to the Minister the amount of fees and charges payable for the provision of medical services and the use of medical and hospital facilities of the public hospital; and

(d)	raise funds and resources, including all monies referred to in Section 31, as the Board may consider necessary for the purposes of the public hospital; and

(e)	in consultation with the Department responsible for health matters, recommend to the Minister the terms on which patients may be admitted to and all other matters affecting patients in, the public hospital; and

(f)	with the written approval of the Minister, make grants or lend money or like benefits; and

(g)	engage persons to perform services for the public hospital; and

(h)	accept gifts, bequests and demises made to the public hospital, whether on trust or otherwise, and act as trustee of money or other property vested in the public hospital on trust; and

(i)	generally do anything incidental to any of its functions.

12.	Without a substantive CEO or a Board it is little wonder that Daru Public Hospital has become dysfunctional. This state of affairs needs to be remedied quickly. I make the same comment in relation to any other public hospital which is lacking a substantive CEO or Board: the situation throughout the country requires urgent review. The National Health Administration Act 1997 calls for implementation of a National Health Plan and administration of health services in accordance with the principles of decentralisation contained in the Organic Law on Provincial Governments and Local-level Governments. It would seem impossible to implement the objectives of that Act if CEOs of public hospitals are allowed to occupy their positions on an acting basis for lengthy and indefinite periods and hospital boards are allowed to become defunct.

13.	As to the actions of the Minister in this case there is little doubt he acted in good faith, doing what he thought was necessary to urgently fix a problem. Unfortunately in doing so he breached the law and exercised powers that he did not have. The Minister for Health and HIV/AIDS has political responsibility for administration of public hospitals in accordance with a determination of such responsibilities by the Prime Minister under Section 148 (functions etc of ministers) of the Constitution, which states:

(1)	Ministers (including the Prime Minister) have such titles, portfolios and responsibilities as are determined from time to time by the Prime Minister.

(2)	Except as provided by a Constitutional Law or an Act of the Parliament, all departments, sections, branches and functions of government must be the political responsibility of a Minister, and the Prime Minister is politically responsible for any of them that are not specifically allocated under this section.

(3)	Subsection (2) does not confer on a Minister any power of direction or control.

14.	Section 148(3) is an important constraint on the exercise of power by any Minister. As explained by the Supreme Court (Kidu CJ, Kapi J, Pratt J) in the leading case SCR No 1 of 1982; Re Phillip Bouraga [1982] PNGLR 178 political responsibility by itself does not allow a Minister to direct or control a Department (in the present case the Department of Health) or any branch of government (such as a public hospital). A Minister's power of direction or control must have its source in a written law. In the present case there is no written law that allows the Minister for Health & HIV/AIDS to suspend or appoint the CEO of a public hospital in an acting or substantive capacity.

15.	As I remarked earlier the procedure for appointment, suspension and dismissal of the CEO of a public hospital seems very convoluted. Perhaps it needs to be simplified. Perhaps these powers should be given to the Minister. Unless and until they are, however, the law must be followed.

ORDER

(1)	The application for judicial review is granted.

(2)	The decision of the third defendant dated 31 October 2012 to suspend the plaintiff as Acting Chief Executive Officer of Daru General Hospital and to appoint another person in his place is declared to have been made in excess of jurisdiction and is quashed.

(3)	This order will take effect, at which time the plaintiff is entitled to resume duty and the person appointed in his place will cease to hold office as Acting Chief Executive Officer, at 12 noon on 5 June 2013.

(4)	The defendants will pay the plaintiff's costs of these proceedings on a party-party basis which shall if not agreed be taxed.

Judgment accordingly.
____________________________

Koeget Lawyers : Lawyers for the for the plaintiff
Solicitor General : Lawyers for the defendants