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Associates: What you need to know about vicarious liability

A recent High Court case on vicarious liability in dentistry and what impacts it could have on you, particularly if you have an NHS contract in England or Wales.

James Goldman
James Goldman Associate Director of Advisory Services, BDA

There has recently been another court decision ruling that a practice owner was vicariously liable for the dental treatment of his associate. There have now been a few, well-publicised cases where practice owners have had to pay substantial sums as a result of poor dental work by their associates without having insurance to cover those losses.

In this recent case, the patient appears deliberately to have chosen to bring a claim against the practice owner rather than the associates (who all had professional indemnity insurance). At present it only applies to NHS practices in England and Wales, as the judge did not feel she had to decide whether that non-delegable duty applied to purely private patients. Some commentators have incorrectly claimed that this decision can be extrapolated to all treatment in every practice and every practice owner-associate relationship. This isn’t true. However, dentists in Northern Ireland and Scotland, while not immediately impacted by this decision, should be aware of the precedent which it may set for cases taken in their jurisdictions.

This decision is likely to impact associates. So, here’s what you need to know about vicarious liability:

Cover for vicarious liability

Many practice owners will not have cover for claims of vicarious liability: that is claims resulting from their associates’ negligent treatment rather than their own dental work. It is possible for practice owners to obtain protection for claims of vicarious liability. Indeed, when we put our BDA Indemnity package together, we build in vicarious liability protection as we knew it was going to be an issue. However, this is a relatively recent and new offering.

Your practice owner may want to check that you have your own professional indemnity cover, and to see evidence of it. That is not unreasonable. Some practice owners have had difficulties when their associates have not had appropriate cover.

You should look very carefully at any such indemnity clauses.

Your associate agreement

It is reasonable for a practice owner to require an associate to agree in the associate agreement to pay for losses caused by the associate through negligent treatment or bad conduct. Such terms are often in what lawyers call “indemnity clauses.” However, you should look very carefully at any such indemnity clauses.

You need to know whether you may be liable even if you are not at fault, or whether you are agreeing to pay the practice owner much more than they would normally have to pay for negligent treatment. We have seen some indemnity clauses in associate agreements that are unfair on associates.

An associate agreement can say that the practice owner has authority to instruct the associate’s indemnity provider to deal with a claim if the associate is not contactable. However, it cannot ensure your practice owner avoids vicarious liability for your clinical work. The best way for practice owners to avoid these liabilities is to work well with their associates as set out above, and to have insurance.

Clinical audits should not impinge on your self-employed status.

Clinical audits

We would expect practice owners to conduct regular clinical audits of your work. If done well, it should be an opportunity for you and your practice owners to see what is going well and whether there are areas you can do even better. These should be helpful and constructive.

Clinical audits should not impinge on your self-employed status. You still have clinical freedom. To that end, associates do not have to listen to practice owners who make suggestions following a clinical audit. But failure to heed sensible warnings about performance is not always best in the long-term. Indeed, a practice owner who is concerned that an associate has clinical issues and who will not listen may give notice to terminate the associate agreement. In a bad case, if the practice owner has serious concerns and does not feel the associate is taking steps to improve, they may even report the associate to the GDC.

Most cases of clinical negligence could probably have been avoided had a complaint been dealt with well.

Dealing with complaints

Most cases of clinical negligence that go to court could probably have been avoided had a complaint been dealt with well. You may find that your practice owner takes a greater interest in any complaints about your work. As associates are self-employed and responsible for their work, practice owners should not take all control on complaint handling from associates.

It is best that the practice owner and associate work together to respond to a complaint and ensure the patient is happy with the way their complaint has been handled. Our advice team provide advice on complaints handling which may help you.

Have questions?

Our advice teams are happy to help associates with questions on their associate agreements. Find out how we can support you by getting in touch with us today: [email protected].