Yousef v Royal Australasian College of Surgeons

The first defendant, the Royal Australasian College of Surgeons (RACS), and the second defendant, the Australian Society of Plastic Surgeons Inc (ASPS), together administer a specialist training program in plastic and reconstructive surgery known as the Plastic and Reconstructive Surgical Education and Training Program (the SET Program) pursuant to a collaborative agreement between them dated 23 December 2020.

The selection process for trainees for the SET Program is conducted by the Australian Board of Plastic and Reconstructive Surgery (the Board) in accordance with selection regulations published by the Board each year.

On 23 March 2022, the plaintiff, Dr Justin Yousef, submitted an application for a position in the SET Program commencing in 2023. On 25 July 2022, Dr Yousef was informed that he was “conditionally offered” a training position in the SET Program commencing in that year. The offer was expressed to be conditional “on ASPS receiving your written acceptance by no later than close of business on Monday 9 August 2022”. Acceptance was to occur by signing and returning an appended training agreement. The training agreement contained the following acknowledgement to be given by Dr Yousef:

Dr Yousef signed and returned the training agreement on 26 July 2022.

On 22 August 2022, Dr William Blake, the National Chair of the Board wrote to Dr Yousef stating that it had recently come to the Board’s attention that there appeared to be “errors and/or omissions” in Dr Yousef’s application in that Dr Yousef had not included information of and referees for the following rotations:

Dr Yousef responded on 5 September 2022. It will be necessary to say more about that response shortly. Following further correspondence between the parties, on 17 October 2022, Dr Yousef was notified that “the offer of a place in the SET Program is withdrawn”.

In these proceedings, Dr Yousef seeks a declaration to the effect that the purported withdrawal of the offer of a position in the SET Program was a breach of an agreement by which the defendants had agreed to provide Dr Yousef with a position in the SET program commencing in 2023. Dr Yousef seeks specific performance of that agreement.

The defendants accept the existence of the agreement. However, they submit that, in accordance with its terms, they were entitled to terminate it because Dr Yousef knowingly provided false and/or misleading information in his application. In the alternative, they contend that they are entitled to rescind the agreement for fraudulent misrepresentation. During the hearing, Mr Chatterjee, who appeared for the defendants, accepted that the common law right to rescind for fraudulent misrepresentation added nothing to the one conferred by the agreement. For that reason, the focus of this judgment is on whether the defendants had a contractual right to terminate the agreement because Dr Yousef had knowingly provided false or misleading information in his application form. At the commencement of the hearing, the defendants also sought to amend their defence to plead that they were entitled in equity to rescind the contract for innocent misrepresentation. Leave to make that amendment was refused.

It is agreed between the parties that if the defendants’ defence fails then:

The 2022 Selection Regulations (the Regulations) contained detailed information about how applications for selection into the 2023 SET Program were to be made and would be evaluated. The Regulations explained that the Board would apply three “selection tools” in assessing an applicant’s suitability for the program. Each tool was allocated a proportion of a maximum possible point score of 1000 points which an applicant could achieve in the selection process. The first tool was described as “Structured CV” and carried a weighting of 20 percent of the total possible points (that is, 200). The second tool was described as “Referee Reports”, which was given a weighting of 35 percent of the total possible points (that is, 350). The third was “Interview” which was given a weighting of 45 percent of the total possible points (that is, 450).

Section 5 of the Regulations dealt with curriculum vitae. It set out minimum training requirements (satisfaction of which did not earn points) and criteria by reference to which points were to be awarded. In summary, a maximum of 60 points would be awarded for surgical experience and qualifications, a maximum of 60 points would be awarded for publications and presentations, a maximum of 40 points would be awarded for certain other qualifications and a maximum of 40 points would be awarded for other specialist skills and achievements.

Section 6 of the Regulations dealt with Referees Reports. Clause 6.2 explained that:

Clause 6.3 was in the following terms:

Clause 6.3.2 relevantly provided:

Under the heading “6.4 Referee Report Information” are a number of clauses including the following:

As I have said, Dr Yousef submitted his application on 23 March 2023. He had submitted applications previously, including one for 2022. Those applications had not been successful.

In accordance with the Regulations, Dr Yousef’s application was submitted online using a link that had been sent to him by email. The application form contained a detailed questionnaire. Section 1 sought information in relation to the minimum criteria, which Dr Yousef completed. Section 2, which was headed “Surgical Experience & Qualifications (maximum available score for this section is 60 points, excluding minimum surgical requirements)”, contained the following question and answer given by Dr Yousef:

Section 6 of the application form required candidates to “Attach your completed Selection Referee nominations using the Contact spreadsheet provided”. After providing some instructions on downloading and completing the spreadsheet, the section relevantly stated:

The spreadsheet itself was divided into two sections. The first section was headed:

The second section of the spreadsheet was headed:

At the time Dr Yousef completed the application, he was employed as a surgical registrar at Wollongong Hospital. He commenced in that position on 7 February 2022 and finished on 7 August 2022. Dr Yousef took leave from that position between 21 and 25 February 2022. The position was a part-time one being 0.6 of a full-time equivalent. Prior to working at Wollongong Hospital, Dr Yousef worked full time as a surgical registrar at Royal North Shore Hospital from 2 August 2021 to 6 February 2022. Before that, he had worked as a surgical registrar at Royal Prince Alfred Hospital (RPAH) from 1 February 2021 to 1 August 2021.

There is no information before the Court concerning Dr Yousef’s experience at Wollongong Hospital. In relation to his time at RPAH, Dr Yousef said in his letter dated 5 September 2022:

Dr Yousef also gave the following evidence in cross-examination:

The parties’ submissions principally focussed on what the defendants had to prove to make out the tort of deceit. However, as I have explained, the primary question before the Court is whether the defendants were entitled to terminate the training agreement (or dismiss Dr Yousef, to use the words of the agreement) because Dr Yousef “knowingly provide[d] false and/or misleading information in [his] application”. The words “knowingly provide[d] false and/or misleading information” are to be given their ordinary and natural meaning in the context in which they appear: Provincial Insurance Australia Pty Ltd v Consolidated Wood Products Pty Ltd (1991) 25 NSWLR 541 at 560 per Mahoney JA; Franklins Pty Ltd v Metcash Trading Ltd (2009) 76 NSWLR 603; [2009] NSWCA 407 at [53] per Giles JA.

The natural meaning of those words requires Dr Yousef to have consciously or deliberately provided information of the relevant character. The requirement of consciousness or deliberateness must relate both to the act of providing the information and the fact that the information was false or misleading. There is no basis for importing into the requirement of “knowingly” legal concepts such as constructive knowledge. That concept does not form part of the ordinary meaning of the word “knowingly”.

Information is false if it is objectively not true. Information is misleading if it is apt to lead the person to whom it is addressed into error, or to give that person the wrong idea or impression about a matter. That is the ordinary meaning of the word “misleading” but see also Campbell v Backoffice Investments Pty Ltd (2009) 238 CLR 304; [2009] HCA 25 at [25] where French CJ adopted a similar interpretation in the context of the statutory prohibition on misleading or deceptive conduct. Consequently, in order for the defendants to succeed they must prove that Dr Yousef consciously or deliberately provided information which he knew was not true or which he knew was apt to lead the Board into error or give it the wrong impression.

Although the test requires knowledge on the part of Dr Yousef, the fact that he acted with knowledge may be inferred from the facts of the case, including what is inherently probable in the circumstances. As White J explained in Australian Securities and Investments Commission v ActiveSuper Pty Ltd (in liq) (2015) 235 FCR 181; [2015] FCA 342 at [400] (a case dealing with the question whether a person was knowingly concerned in a statutory contravention):

The defendants need only prove that Dr Yousef had the relevant knowledge on the balance of probabilities. However, in applying that standard, it is necessary to bear in mind the seriousness of the allegations against him: Evidence Act 1995 (NSW), s 140; Briginshaw v Briginshaw (1938) 60 CLR 336; [1938] HCA 34 at 361-2 (Dixon J).

The defendants plead in their amended defence that Dr Yousef’s application was knowingly false or misleading in five respects:

It is not part of the defendants’ case that they relied on any of the false or misleading information in the sense that, had Dr Yousef disclosed the information that it is said was not disclosed, the outcome of his application would have been any different. Their case is that it is the knowingly false or misleading information which entitled them to terminate the agreement. The fact that it was not asserted that the defendants relied on the allegedly false or misleading information may have been relevant to a case of innocent disclosure (which the defendants were not permitted to raise) or to the relief to which Dr Yousef is entitled if he succeeds (which is now the subject of an agreement). However, Dr Yousef (properly) did not contend that the absence of reliance alone prevented the defendants from terminating the agreement. The language conferring the right of termination is clear. The knowing provision of false or misleading information was sufficient to trigger that right.

It is convenient to take the allegations in relation to Wollongong Hospital and RPAH separately.

So far as Wollongong Hospital is concerned, it is important to observe that the defendants’ only complaints in relation to Wollongong Hospital are that Dr Yousef did not identify his rotation at that hospital as his most recent plastic and reconstructive surgical term and therefore did not nominate all the Consultant Plastic Surgeons from that term (including those he had not worked with) and at least one nurse referee from that term. It is not alleged that Dr Yousef incorrectly answered the question in paragraph 2.2.8, which required Dr Yousef to attach evidence of “ALL OF YOUR SURGICAL EXPERIENCE from the past five (5) years” by failing to disclose his term at Wollongong Hospital.

I am not satisfied that the defendants have made out those claims.

Dr Yousef correctly accepts that the questions in the application form and instructions in the spreadsheet must be read together with the Regulations. Indeed, that is what he said he did. Clause 6.3.1 of the Regulations is divided into three rows. The first row required Dr Yousef to list “All Consultant Plastic Surgeons from the most recent (including current) plastic & reconstructive surgical term” and to identify “which consultant plastic surgeons an applicant did and did not work with”. The second row required Dr Yousef to list “No less than three (3) and no more than five (5) consultant surgeons worked with from each surgical term over the last two (2) years”. If Dr Yousef was unable to identify at least three, he was required to give reasons in the spreadsheet. The third row required Dr Yousef to identify at least one nurse (of particular categories) “from each surgical term over the last two (2) years”. As I have explained, the spreadsheet was divided into two sections. The first related to information to be provided in accordance with the first row of cl 6.3.1. The second section related to information to be provided in accordance with the other two rows of cl 6.3.1. Had the matter been left there, the position would have been clear.

However, cl 6.3.2.12 states that “for all referees listed … Referees nominated by an applicant must have worked with the applicant for a minimum of 10 working weeks in the valid period … exclusive of periods of leave but inclusive of up to the Referee valid till date [that is, up to and including 18 April 2022]”. Moreover, paragraph 6.1.37 of the application form relevantly says that “[f]or each rotation from the last two years, you must … [e]nsure the referee is able to assess your performance in a surgical unit and they were a qualified surgeon at that time (i.e. is a valid referee as per Selection Regulation 6.3.2)”. The instructions in the section of the spreadsheet concerned with the most recent rotation (which was to include rotations of 10 weeks, up to 18 April 2022) was to “Provide ALL P&RS Consultants worked with from your most recent plastic & reconstructive surgical term”.

Clause 6.3.2.12 appears to be inconsistent with cl 6.3.1 and the instructions given in the spreadsheet. Clause 6.3.1 requires all Consultant Plastic Surgeons to be named. Similarly, the instructions for completing the spreadsheet required the provision of “ALL P&RS Consultants worked with from your most recent plastic & reconstructive surgical term”, although the spreadsheet itself requires an applicant to identify whether the applicant had worked with the referee or not. However, cl 6.3.2.12, which is said to be a condition that applies “for all referees” states that “[r]eferees nominated by an applicant must have worked with the applicant for a minimum of 10 working weeks … exclusive of periods of leave but inclusive of up to [18 April 2022]”.

The defendants submit that the tension between cl 6.3.1 and the instructions in the spreadsheet on the one hand and cl 6.3.2.12 on the other is best resolved by interpreting cl 6.3.2.12 as applying only where the applicant was given a choice about which referees to nominate – that is, as only applying to the second and third rows of cl 6.3.1 (and the second section of the spreadsheet). In addition, it might be said that the words “worked with from your most recent plastic & reconstructive surgical term” in the spreadsheet must be interpreted as simply identifying the consultants who worked for the relevant unit.

I accept that the defendants’ interpretation of cll 6.3.1 and 6.3.2.12 and the instructions in the spreadsheet best resolves the tensions between the relevant provisions. However, that is not how Dr Yousef says he interpreted them. He says that he interpreted the regulations as requiring him only to disclose referees for whom he had worked for a period of 10 weeks up to 18 April 2022 exclusive of periods of leave. He says that after deducting the leave he had taken in February, up until 18 April 2022 he would only have worked at Wollongong Hospital for 9 working weeks (fewer, if adjusted for the fact that he only worked part time).

I accept Dr Yousef’s evidence. In my opinion, the interpretation he adopted of the relevant provisions was one that was reasonably open. The wording of cll 6.3.1 and 6.3.2 (and 6.3.2.12, in particular) was confusing. It was not cleared up either in the instructions in the online questionnaire or in the instructions given in the spreadsheet. It was reasonable to treat cl 6.3.2.12 as paramount when the introductory words state that it applied “for all referees”, even though that interpretation appeared to be inconsistent with cl 6.3.1. It is not suggested that Dr Yousef had any reason not to disclose his term at Wollongong Hospital apart from what he understood the Regulations required him to do.

The defendants submit that Dr Yousef could not have understood the Regulations in the way he says that he did because when in 2021 he applied for a position in in the 2022 SET Program, he disclosed his term at the Royal North Shore Hospital, even though, at the time he submitted his application, he had not worked at that hospital for 10 weeks. However, the regulations applicable to that application had no equivalent to cl 6.3.2.12. Consequently, there was nothing in those regulations that suggested that Dr Yousef could only nominate referees from placements where he had worked for a period of ten weeks or more.

The defendants make three allegations in relation to the RPAH. First, they contend that Dr Yousef did not disclose in response to question 2.2.8 in the application form that he had worked at that hospital, even though he had worked in the plastic surgery unit of that hospital for a period of six months within the past five years of the date of his application. Second, the defendants contend that, contrary to the requirements of the second row of cl 6.3.1, Dr Yousef did not provide the names of at least three consultant surgeons with whom he had worked at that hospital, even though he had worked at that hospital within the last two years (at the time of his application). Third, the defendants contend that, contrary to the requirements of the third row of cl 6.3.1, Dr Yousef did not provide the name of at least one nurse with whom he had worked at that hospital.

So far as question 2.2.8 is concerned, Dr Yousef submits that the requirement to attach evidence of “ALL OF YOUR SURGICAL EXPERIENCE” must be read together with cll 5.6.4 – 5.6.9 and 5.7.2 – 5.7.3 of the Regulations and the note in the application form that states that “assessors will use evidence submitted for this question to assess minimum eligibility requirements and points for surgical experience”. Clauses 5.6.4 to 5.6.9 set out the minimum requirements for plastic surgery and general surgery rotations. Clauses 5.7.2 and 5.7.3 set out the types of surgical rotation for which points will be awarded. There is nothing in the Regulations which required Dr Yousef to identify all his surgical rotations over the previous five years. The purpose of the question was to determine whether an applicant met the minimum eligibility requirements and to determine points for surgical experience. Consequently, when read together with the Regulations, the application form only required Dr Yousef to identify all his surgical experience on which he relied.

So far as the requirement to identify at least three consultant referees is concerned, Dr Yousef contends that the defendants have failed to establish that he worked for any consultant at RPAH for a period of at least ten weeks. The only consultant identified by the defendants was Dr Phoon, and the evidence is that Dr Yousef did not work with him for ten weeks. That was said to be so because, like many public hospital appointments, Dr Yousef’s appointment at RPAH was part time – 0.7 of a fulltime position. As is common, for the balance of his time, Dr Yousef worked at a private hospital. According to Dr Yousef, Dr Phoon was the on-call consultant for the plastic surgery unit at RPAH for five of the part time working weeks when Dr Yousef was working there (that is, the weeks commencing 22 February 2021, 29 March 2021, 3 May 2021, 7 June 2021 and 5 July 2021). In addition, Dr Yousef says that he was present with Dr Phoon at the plastic surgical unit for about an hour on 4 March 2021, about 5.25 hours on 15 March 2021, most of the day on 26 April 2021, most of the day on 10 May 2021 and about 1.5 hours on 11 May 2021. On any view, that time did not add up to 10 fulltime working weeks.

Dr Yousef also gave evidence that he worked for several other consultants at RPAH. He undertook a similar analysis of the time he spent working with those consultants to conclude that he worked with none of them for a period of ten weeks.

As to the requirement to nominate a nurse from RPAH, Dr Yousef identifies a number of nurses with whom he worked but says that his interaction with most of those nurses was sporadic, partly as a consequence of COVID-19. He does say that he worked with two clinical nurse consultants, Ms Melissa Goman and Ms Katie O’Reilly, both of whom worked part time. He gave the following affidavit evidence in relation to those:

In my opinion, the interpretations that Dr Yousef seeks to give to the questions in the application form and the instructions given in both the application form and the Regulations are not correct and are not ones that Dr Yousef could honestly have thought were correct at the time he completed his application.

The instructions in paragraph 2.2.8 were clear. They were to identify ALL OF YOUR SURGICAL EXPERIENCE from the last five years. The words “ALL OF YOUR SURGICAL EXPERENCE” were capitalised to emphasise their importance. They made it clear that “ALL” meant all. The notes state that one of the purposes of the question was to permit the assessors to determine whether the minimum eligibility requirements had been satisfied and to allocate points for surgical experience. However, there is nothing in the form or the Regulations to suggest that that was the only purpose for which the information was being sought.

Dr Yousef’s submissions in relation to the requirement to nominate at least three consultants and one nurse who had worked with him in each surgical term over the past two years depends on an overly narrow reading of the words “worked with” as used in cl 6.3.2.12 of the Regulations. The purpose of the requirement that referees had worked with a candidate for at least ten weeks was to identify referees who could be expected to have sufficient exposure to the candidate’s work to be able to provide meaningful feedback in relation to the “competencies and workplace markers” (to quote from cl 6.17 of the Regulations) of interest to the Board. That did not mean that they had to spend every working hour of every working day over a ten week period, or the equivalent of that time, with the candidate to be able to express an opinion.

The two clinical nurse consultants identified by Dr Yousef provide an example. It is apparent from Dr Yousef’s evidence that he worked closely with both nurses over a period of five months in the case of one nurse and six in the case of the other. That was clearly enough time for them to form an opinion on Dr Yousef’s personal and professional attributes that were of interest to the Board.

Similarly, the ability to provide feedback did not simply depend on personal interaction between the person and the candidate. Rather, it depended on the person’s ability to observe the candidate’s work, which, in the case of a consultant, for example, could include observation of the results of the candidate’s work and feedback from more senior registrars. Dr Phoon is an example. He swore an affidavit in which he provided an assessment of Dr Yousef’s suitability to join the SET Program. He was not cross-examined on that evidence, and in particular, it was not put to him that he had had insufficient exposure to Dr Yousef over the six months that Dr Yousef worked at RPAH to be able to assess him.

In addition, the interpretation for which Dr Yousef contends is difficult to reconcile with the fact that cl 6.3.2.12 of the Regulations makes it clear that, in calculating the ten-week period, an applicant is required to include the period up to 18 April 2022 – that is, a date after the application was lodged. The evident purpose of the provision is to require a candidate to include his or her then current rotation, which would normally start in early February. An exception is made in cases where the referee (or the candidate) is on leave during part of that period. However, it seems clear that a candidate will not have worked with anyone in that rotation for a period of ten weeks on Dr Yousef’s interpretation of the requirement. Indeed, if the interpretation of cl 6.3.2.12 for which Dr Yousef contends is correct, it seems doubtful that any consultant plastic surgeon working in a public hospital would have sufficient contact with an applicant to be able to meet the requirements of that clause. In the context, the requirement that ta person have “worked with” a candidate for at least ten weeks must be understood as a requirement that the person worked in the same unit as the candidate and was in a position to observe the candidate’s work over a period of at least ten weeks. The consultants and nurses identified by Dr Yousef at RPAH satisfied that requirement.

Dr Yousef submits that even if the interpretation of the Regulations and questions and instructions given in the application form for which he contends are incorrect, the interpretation he adopted of each clause and provision was at least arguable so that it could not be said that he knowingly gave false or misleading information.

I cannot accept that submission. The issue is not to be resolved simply by reference to a careful analysis of each relevant clause and provision. Dr Yousef must have understood that the purpose of the application form was to elicit information relevant to his qualifications, experience, ability and other qualities so that the Board could make an informed decision about his suitability for a position in the SET Program and to do so in a way that was fair to all candidates given the very limited number of places that were available. It must have been obvious to Dr Yousef that the Board would want to know that within the past two years of his application, he had completed a six-month rotation in the plastic surgery unit of RPAH. He also must have known that, in accordance with the selection process set out in section 6.4 of the Regulations, it was likely that the Board would obtain a reference from at least one consultant (and probably more) and nurse at that hospital. Dr Yousef also knew that there was a substantial risk that the reference from one or more consultants would be negative. The only reasonable inference available from those facts is that Dr Yousef did not want to disclose his rotation at RPAH because he was concerned about the possibility of a negative reference which would affect his candidature. To avoid that consequence, he sought to justify the nondisclosure of his rotation at RPAH by adopting an interpretation of the Regulations and the instructions in the application form which he knew would convey a false or misleading impression to the Board – namely, that the only plastic surgical rotations he had completed in the past two years were the ones he disclosed.

It may be, as Dr Yousef said in his letter dated 5 September 2022, that his performance at RPAH and the assessment of those working at that hospital were not a true reflection of his abilities and suitability for the SET Program. But that was a question for the Board to assess based on all the material given to it. Dr Yousef must have appreciated that when he withheld information about his term at RPAH he was depriving the Board of the opportunity to make that assessment and misleading it in the process. Or, to put the point in terms that correspond more closely to the acknowledgment given by Dr Yousef when he signed the training agreement, Dr Yousef must have known that he was being asked to state all his surgical experience in the past five years and to nominate referees at least in respect of completed terms in the past two years and that it was false or misleading in those circumstances not to disclose in the application form his term at RPAH, since the application form falsely or misleadingly suggested that Dr Yousef had not completed any surgical rotations that were relevant to the Board’s assessment apart from those that he disclosed.

It follows that the summons must be dismissed with costs.