Krebs v NHS Commissioning Board

A contractual requirement that a public body act reasonably and as a responsible public body may import standards familiar from public law. In this contract, reasonableness bore its ordinary contractual meaning rather than the restricted Wednesbury meaning.

A contracting party cannot use public law remedies to improve a failed contractual claim. Where termination complies with the contract and is reasonable and proportionate, the claimant is confined to any available private law remedies.

A contractual right to future income is not, without evidence of relevant goodwill or another established possession, protected by article 1 of Protocol 1 to the European Convention on Human Rights.

A dentist contracted with a primary care trust to provide NHS dental services. The contract required him to co-operate with an assessment by the National Clinical Assessment Service and permitted termination following an unremedied breach. After he declined to co-operate, the trust served a remedial notice and then a termination notice.

Turner J dismissed the dentist’s challenge in [2013] EWHC 3474 (Admin). The dentist appealed, contending that the termination had been cancelled or required a fresh notice, that the NHS body had acted unreasonably and disproportionately, that public law remedies were available, and that termination infringed article 1 of Protocol 1 to the European Convention on Human Rights.

1. Appeal dismissed. The letter by which the trust agreed not to act temporarily upon the original termination did not cancel the termination. At most, it postponed implementation. Even if the termination had been cancelled, the underlying remedial notice remained effective. The letter of 30 April 2013 therefore operated, if necessary, as a fresh termination notice and gave the contractually required notice period.

2. Per Longmore LJ, with whom Kitchin LJ agreed, clause 10 deliberately introduced into the contract concepts familiar from public law. Contractual reasonableness was not confined to Wednesbury irrationality. Clause 11 could mitigate the consequences of clause 10 by preserving the dentist’s duty to comply with express contractual requirements, but it could not reduce clause 10 to a dead letter. The precise relationship between the clauses was not necessary to decide because the termination was reasonable on any relevant approach.

3. The NHS body acted reasonably and proportionately. The dentist had repeatedly declined to comply with clear contractual requirements, disengaged from legitimate processes, imposed unjustified conditions and reversed an earlier willingness to undergo assessment. The body had shown considerable indulgence, explained its position carefully and acted in the context of potential risks to patient welfare. The dentist’s eventual acceptance of assessment did not make termination unreasonable.

4. The dentist was confined to his contractual remedies. Judicial review and related public law remedies could not be used to obtain an outcome equivalent to enforcement of a contractual right after the contractual claim failed. Considerations of proportionality did not alter the result.

5. Article 1 of Protocol 1 to the European Convention on Human Rights was not infringed. No evidential basis established relevant goodwill as a possession. A contractual right to future income, particularly under a contract terminable on 28 days’ notice, did not suffice.

1. Court of Appeal (Civil Division): The appeal was dismissed in [2014] EWCA Civ 1540, although the court did not agree with every part of the judge’s reasoning.
2. High Court, Queen’s Bench Division: Turner J found for the NHS Commissioning Board and rejected the dentist’s contractual, public law and human rights challenges in [2013] EWHC 3474 (Admin).