Krebs v NHS Commissioning Board

A dispute that is fundamentally contractual remains a private-law dispute even where one party is a public body. The public character of the contracting party, or the fact that the contract concerns public services, does not by itself justify public-law remedies.

Express contractual obligations must be complied with despite a general obligation to act reasonably and in good faith. Where a contractor deliberately refuses a contractual assessment requirement, valid remedial and termination provisions may be enforced. Any proportionality or rationality review, if available, is fact-sensitive and does not displace the contract. Contractual rights relied on as possessions under Article 1 of Protocol No. 1 must be assessed together with the contractual burdens and conditions.

The claimant, a dentist providing NHS dental services, challenged the termination of his contract by the NHS Commissioning Board, following the abolition of the relevant primary care trust. The defendant had required him to co-operate with an assessment by the National Clinical Assessment Service after concerns about his clinical performance, record keeping and treatment claims.

The claimant refused to co-operate. The defendant served a remedial notice and later a termination notice under the contract. The claimant sought relief on private-law, public-law and Convention grounds, contending that termination was contractually invalid, disproportionate or irrational, and infringed his rights under Article 1 of Protocol No. 1.

1. Private contractual claim. The claimant’s obligation to co-operate with an assessment was an express term of the contract. The general obligation to act reasonably and in good faith did not relieve him from complying with that express term. The remedial notice and termination provisions were valid and contractually effective.
2. The defendant’s later letter holding termination in suspension was a pragmatic indulgence intended to preserve the status quo while the threatened injunction was avoided. It did not create an additional obligation of proportionality or general reasonableness, nor did it remove the defendant’s accrued contractual right to terminate on reasonable notice.
3. Public law. Applying R v East Berkshire Health Authority ex p Walsh [1985] QB 152 and Hampshire County Council v Supportways Community Services Ltd [2006] EWCA Civ 1035, the claim was fundamentally contractual. The defendant’s status as a public body and the public nature of the services did not transform the dispute into one attracting public-law remedies. There were no allegations of fraud, improper motive or other very unusual circumstances.
4. Even if public-law concepts were relevant, the termination was neither irrational nor disproportionate. Relevant considerations included the claimant’s repeated refusal to comply with clear contractual requirements, his disengagement from the assessment process, the defendant’s substantial indulgence, and the potential risk to patients.
5. Article 1 of Protocol No. 1. Contractual rights must be viewed as part of the contract as a whole. The claimant could not rely on the benefits of the contract while disregarding its burdens. His deliberate breach of a reasonable, non-penal assessment requirement meant that termination did not deprive him of a greater possession than he had acquired.

The claim was dismissed and judgment was entered for the defendant.