NHS Commissioning Board (Known As NHS England) v Vasant (t/a MK Vasant & Associates) & Ors

A written variation satisfying a contractual requirement for writing and signature may use an expression whose meaning requires extrinsic evidence. Evidence of the parties’ shared linguistic usage may explain an unconventional or technical expression without adding to or altering the written terms. An entire agreement clause does not exclude such evidence.

Entire agreement and no-oral-modification clauses may nevertheless prevent reliance on negotiations, subjective intentions, subsequent conduct or a previous course of dealing to incorporate additional terms. They do not ordinarily prevent terms intrinsic to the agreement, necessary for business efficacy or implied by statute. Where a written variation contemplated later negotiation of the price for continuing services, agreeing that price implemented rather than varied the contract.

Three dentists supplied general dental services under standard-form contracts with a primary care trust, later succeeded by NHS England. They separately supplied intermediate minor oral surgery services under contracts which continued by conduct after their fixed terms expired.

In 2009 the parties signed variation forms changing a reserved clause in each general dental services contract to provide an advanced mandatory service in the form of an intermediate minor oral surgery service. When NHS England later sought to terminate that service under the termination provisions of the earlier service contracts, the dentists maintained that the service had become part of their general dental services contracts.

Murray J, in [2018] EWHC 3002 (QB), held that NHS England could not terminate the arrangements. The central issue on appeal was the contractual effect of the written variation and the permissible use of extrinsic material to determine its meaning.

1. Appeal dismissed. The signed variation form satisfied the contractual requirement that any variation be in writing and signed by the parties. It validly made the intermediate minor oral surgery service a further service under Part 10 of the general dental services contract.
2. The judge had erred in relying upon pre-contractual correspondence, the contracting parties’ oral evidence of subjective intention and their conduct after the variation. Negotiations could not be used to infer the meaning of the concluded written agreement. Subjective intention was irrelevant, and subsequent conduct was inadmissible when interpreting a wholly written contract.
3. The combination of the entire agreement clause and written variation clause meant that the contractual terms consisted only of the original general dental services contract and the compliant written variation. Although the variation could have incorporated provisions of the earlier service contract expressly, it did not do so. A previous course of dealing or common understanding could not identify and incorporate a selected group of its clauses.
4. That conclusion did not prevent extrinsic evidence from explaining the shared meaning of the expression “an Intermediate Minor Oral Surgery (IMOS) service”. Evidence of an unconventional, technical or privately shared linguistic usage explains the language chosen; it does not add to or alter the contractual terms. An entire agreement clause does not exclude admissible evidence used for that purpose.
5. Clause 17 and Appendix 1 of the earlier service contract supplied the parties’ shared description of the IMOS service. Appendix 1 was therefore admissible and vital to explaining the expression in the variation. No other portion of the earlier contract was incorporated, particularly its termination provisions.
6. The reference in Appendix 1 to fees being negotiated did not make the arrangement uncertain. An entire agreement clause does not prevent a term intrinsic to the agreement or necessary for business efficacy, and conventional wording does not exclude the statutory implication of a reasonable charge under section 15 of the Supply of Goods and Services Act 1982. The written variation clause likewise did not exclude necessary or statutory implied terms. In any event, agreeing prices through the negotiation contemplated by Appendix 1 implemented the contract rather than varied it.

Lewison LJ delivered the judgment. Coulson and Longmore LJJ agreed.

1. Court of Appeal (Civil Division): The appeal was dismissed. The signed variation validly brought the intermediate minor oral surgery service within the general dental services contract, although the court differed in part from the judge’s reasoning.
2. High Court, Queen’s Bench Division: Murray J held in [2018] EWHC 3002 (QB) that NHS England was not entitled to terminate the contractual arrangements.