Vikram Bhat & Anor, R (on the application of) v NHS Litigation Authority

A general dissolution of a partnership does not automatically terminate a General Medical Services contract where the contract provides that it is made with the partnership as from time to time constituted. Regulation 15 of the National Health Service (General Medical Services Contracts) Regulations 2015 and the corresponding contractual provision preserve the contract when the partnership is dissolved and a new partnership continues the same practice.

Provisions permitting variation from a partnership to a sole practitioner provide an option, not a mandatory condition on which continuation of the contract depends. The commissioner may address a serious adverse impact caused by a change in membership through the specific termination power, but must exercise that power rather than rely on automatic termination.

The claimants, partners in a general medical practice, sought judicial review of a determination by the NHS dispute-resolution adjudicator. The adjudicator had decided that service of a notice dissolving the partnership automatically terminated the General Medical Services contract with NHS England and that an implied fixed-term contract then arose until 31 March 2022.

The practice continued under the same name and at the same premises after Mrs Patel ceased to participate. The central issues were whether the partnership dissolution terminated the contract by operation of law and, consequently, whether an implied fixed-term contract arose.

1. Claim allowed. The adjudicator erred in law by deciding that the General Medical Services contract terminated automatically when the partnership was dissolved.
2. Although partnership law treats a change in partners as a dissolution of the old partnership and creation of a new one, regulation 15 of the National Health Service (General Medical Services Contracts) Regulations 2015 provides that a contract with partners is treated as made with the partnership as from time to time constituted. Schedule 1 of the contract additionally stated that it continued despite the retirement, death or expulsion of partners. The new partnership continued the same practice, under the same name and at the same premises.
3. The distinction between a technical and general dissolution did not justify different contractual consequences. It concerns the consequences of dissolution, rather than whether the dissolution was consensual. There had been no full winding-up of the partnership. In any event, there was no lawful basis for implying requirements of unanimous consent, a written partnership agreement, or a technical rather than general dissolution into regulation 15 or Schedule 1.
4. The provisions allowing a partnership contractor to change its status to that of a sole medical practitioner were optional. Paragraph 59 of Schedule 3 and clause 26.3 provided a mechanism for variation, not an obligation to nominate a former partner on pain of losing the contract. The court followed the reasoning of Soole J. in Jones that the provision was no more than an option.
5. The commissioner had separate powers to terminate following a material change in partnership membership where there was likely to be a serious adverse impact, and following a court-ordered dissolution. Those powers were inconsistent with automatic termination. NHS England had not exercised the relevant power in this case.
6. There was no need to determine whether an implied fixed-term contract arose, because the conclusion on automatic termination resolved the claim.

First-instance judicial review. Bright J. granted permission to apply for judicial review on 9 October 2023. The High Court (Administrative Court) allowed the claim and quashed the adjudicator’s legal conclusion that the contract had terminated automatically. The judgment did not determine the second issue concerning an implied fixed-term contract.