UK: Dental Brief - June 2014

Last Updated: 2 June 2014
Article by Jenin Khanam

Oasis increases its portfolio

In addition to the acquisition Smiles for Dental in April 2014 Oasis has now acquired Apex Dental Care. The acquisition of Apex's 31 practices has now added to Oasis' growing dental practice network to over 310 in just 6 weeks. Ben Chiang CEO of Apex Dental stated "by combining Apex's dental practice with Oasis the group will be well placed to continue improving the breadth and quality of our services to patients with the benefit of an expanded network and an even stronger clinical support team".

The meaning of "examination"

In the recent case of Dusza and Sobhani v Powys Teaching Local Health Board the High Court considered what is meant by 'examination' under the Standard General Dental Service Contract ("GDS contract").

The Claimants had applied for judicial review of the Defendant Health Board's decision that the dentist should repay sums that they received in respect of treatment provided to patients.

The Court found that the word "examination" in a GDS contract meant a full mouth examination and not just an examination of the particular point in the mouth under which a patient might complain.

A failure to record the carrying out of a full mouth examination did not mean that the dentists were not entitled to payment for the course of treatment provided under the GDS contract.

Valilas v Januzaj

In the recent case of Valilas v Januzaj, the Court of Appeal had to determine a dispute between Mr Valilas ("Mr V") and Mr Januzaj ("Mr J") and decide on the meaning of an agreement under which Mr J allowed Mr V to use the premises, equipment and support staff to provide dental services. In return, Mr V was to perform a certain number of UDAs and pay Mr J in advance half of what he was paid under the NHS contract, owned by Mr V. If there was shortfall in UDAs a clawback would be requested and Mr V and Mr J would refund their respective share of the shortfall back to the NHS.

The relationship between the parties became strained and Mr J indicated that he would terminate the contract if matters weren't resolved. Mr V fell behind with his UDAs and informed Mr J that he would stop making monthly payments as Mr V was not confident that Mr J would pay his share of the clawback if the contract ended. Mr V proposed that he would pay Mr J 50% of the payment received for the UDAs Mr V had performed and Mr V would then solely be responsible for any clawback at the end of the year. Mr J refused and objected to the non-payment. After 3 months of non payment Mr J excluded Mr V from the practice and ended the contract.

The Court of Appeal concluded that the failure by Mr V to make monthly payments on time was not a condition that allowed Mr J to end the contract and exclude Mr V, because under the contract the time for payment was not fundamental. The Court decided that breaches by Mr V could not be classed as depriving Mr J of substantial benefit of the whole of the contract.

If Mr J and Mr V had a written contract that said time was of the essence, Mr J would have been able to protect his position in the event of a future dispute. As Sam Goldwyn once said: "An oral contract isn't worth the paper it's written on"!

Capital Allowances on Property Transactions

From 30th April 2014 a buyer will only be able to claim capital allowance on a purchase if a seller has "pooled" its expenditure on fixtures and fittings for capital allowances purposes for the duration in which the seller has owned the property. The pooling requirement will not be an issue where the seller has been claiming his allowances which he has been entitled to and records have been kept. However, buyers will need to take particular care if the seller has not claimed allowances. Buyers may therefore want to investigate whether sellers have claimed all allowances that could have been claimed. Buyers will therefore need to find out about a seller's capital allowance position as soon as possible in order to take any necessary steps to secure capital allowance claims for the future.

Where a lease is involved the allowance will remain with the landlord unless an election is made and the allowance is to be passed to the tenant. Tenants however should be able to claim capital allowances in respect of expenditure which they have incurred on qualifying allowances as part of their fit out.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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Jenin Khanam
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