"There should be but one test for dishonesty in all civil proceedings, whatever their nature"Mostyn J's recent judgment in Kirschner v General Dental Council may not have delivered the clarity or
"There should be but one test for dishonesty in all civil proceedings, whatever their nature"
Mostyn J's recent judgment in Kirschner v General Dental Council may not have delivered the clarity or consolidation of the legal test(s) for dishonesty which the regulatory and disciplinary legal world had been anticipating but could yet represent a contribution towards it. Mostyn J described the divergent approaches between disciplinary proceedings, which employ the Ghosh/ Twinsectra[1] test almost by default, and "mainstream civil proceedings" (again, to borrow his phrase), which use the test established in Barlow Clowes[2], as an "unhappy state of affairs" and provided a pronounced opinion on the test which should be adopted in regulatory cases. This topic has been touched upon in several cases in the last year, and I will not repeat their dicta here: Mostyn J's judgment delivered a thorough history of these and you can, in addition, review our series of blog posts on these developments here: 1, 2, 3, and 4.
The appeal
The appellant dentist in this case appealed a finding of dishonesty by the GDC's Professional Conduct Committee ("PCC") and its decision to suspend her from practice for one year. The PCC found the appellant guilty of dishonestly claiming payments under her NHS dental contract of £48 for treatment of each of three child patients, a total of £144, when the NHS' terms would not have justified her splitting and inflating the costs of treatments in such a way. The PCC adopted what Mostyn J defined as the "Twinsectra/ Ghosh" test in order to establish dishonesty, which requires that, on the balance of probabilities a defendant:
The PCC did not adopt the adaptation advanced by Longmore J in Hussain v GMC[3], in which he suggested that the first limb of the Twinsectra/ Ghosh test be modified to refer to the standards not of reasonable and honest people, but of reasonable and honest practitioners. The PCC did not have the benefit of the recent decision in PSA v HCPC (David)[4], which sought to make clear that the standard of proof for both limbs should be the civil standard.
Barlow Clowes
In Mostyn J's opinion, disciplinary proceedings should adopt the test for dishonesty established by the Privy Council in Barlow Clowes, and, by extension leave Ghosh and its other adaptations to the criminal courts. His reasoning was, in summary, that the Barlow Clowes test had "overreached or superseded" Twinsectra/ Ghosh (as outlined above) by way of the Court of Appeal's judgment in Abou-Rahmah[5] in 2006 and, most recently, the Privy Council's in Central Bank of Ecuador v Conticorp in 2015, which both approved Barlow Clowes. Mostyn J commented, in respect of the latter case, that the Privy Council is "the Supreme Court in all but name, and if it propounds a legal test then we should [unless certain circumstances apply] faithfully follow it". Successive judgments had, he considered, mistaken or ignored the authority of these three cases.
Under the Barlow Clowes test, as Mostyn J clarified, the "only relevant mental state of a defendant accused of dishonesty in civil proceedings is his or her knowledge [of their actions]"; it then falls for the tribunal to consider whether the defendant, possessing this knowledge and having acted accordingly, was dishonest by the standards of the fair and reasonable person (and not of a particular cohort or profession, as suggested in Hussain v GMC).
It would be unnecessary for a disciplinary tribunal adopting Barlow Clowes to find that a defendant accused of dishonesty was actually aware that what they were doing was wrong, so it arguably represents a lower threshold than Twinsectra/ Ghosh. A tribunal could still find that the defendant knew that what they were doing was dishonest, however, as this would be "highly relevant" to its consideration of sanctions.
Mostyn J's judgment
Mostyn J conceded that it was not for him in this case to hold that Twinsectra/ Ghosh should not have been adopted by the PCC. Despite his misgivings with the adoption of Twinsectra/ Ghosh and Hussain, he was effectively bound to follow them here. He added, however, and this will likely be uncontroversial amongst legal commentators, that "the position needs to be conclusively clarified by the higher appellate courts or by legislation".
The only question which Mostyn J had to decide was whether the factual findings met the standards of Twinsectra/ Ghosh so as to justify the PCC's judgment of dishonesty. He concluded that they did not. The PCC held, for example, that the appellant had "persuaded herself" that splitting the treatment claims in the way she did was acceptable but yet, apparently, was dishonest by the standards of a reasonable person. Mostyn J allowed the appeal and quashed the findings of dishonesty on the basis that the PCC's decision in this respect was "an oxymoron". The case was remitted to the PCC to reconsider sanction.
The case does not change or modify the correct legal test for dishonesty in regulatory proceedings. It remains that modified by Hussain and David. The judgment has, however, amplified the calls for the test to be codified between disciplinary and (other) civil proceedings.
[1] R v Ghosh [1982] QB 1053, adapted by the House of Lords in Twinsectra Limited v Yardley and others [2002] UKHL 12
[2] Barlow Clowes International Ltd v Eurotrust International Ltd [2005] UKPC 37, recently approved by Central Bank of Ecuador & Ors v Conticorp SA & Ors (Bahamas) [2015] UKPC 11
[3] [2014] EWCA Civ 2246
[4]Professional Standards Authority for Health and Social Care v Health and Care Profession Council, Elizabeth Abosede David [2014] EWHC 4657 (Admin)
[5] Abou-Rahmah & Anor v Al-Haji Abdul Kadir Abacha & Ors [2006] EWCA Civ 1492
Mostyn J's recent judgment in Kirschner v General Dental Council may not have delivered the clarity or consolidation of the legal test(s) for dishonesty which the regulatory and disciplinary legal world had been anticipating but could yet represent a contribution towards it. Mostyn J described the divergent approaches between disciplinary proceedings, which employ the Ghosh/ Twinsectra[1] test almost by default, and "mainstream civil proceedings" (again, to borrow his phrase), which use the test established in Barlow Clowes[2], as an "unhappy state of affairs" and provided a pronounced opinion on the test which should be adopted in regulatory cases. This topic has been touched upon in several cases in the last year, and I will not repeat their dicta here: Mostyn J's judgment delivered a thorough history of these and you can, in addition, review our series of blog posts on these developments here: 1, 2, 3, and 4.
The appeal
The appellant dentist in this case appealed a finding of dishonesty by the GDC's Professional Conduct Committee ("PCC") and its decision to suspend her from practice for one year. The PCC found the appellant guilty of dishonestly claiming payments under her NHS dental contract of £48 for treatment of each of three child patients, a total of £144, when the NHS' terms would not have justified her splitting and inflating the costs of treatments in such a way. The PCC adopted what Mostyn J defined as the "Twinsectra/ Ghosh" test in order to establish dishonesty, which requires that, on the balance of probabilities a defendant:
- acted dishonestly by the standards of the reasonable and honest person (the objective limb); and, if they did,
- realised that their actions were, by those standards, dishonest (the subjective limb).
The PCC did not adopt the adaptation advanced by Longmore J in Hussain v GMC[3], in which he suggested that the first limb of the Twinsectra/ Ghosh test be modified to refer to the standards not of reasonable and honest people, but of reasonable and honest practitioners. The PCC did not have the benefit of the recent decision in PSA v HCPC (David)[4], which sought to make clear that the standard of proof for both limbs should be the civil standard.
Barlow Clowes
In Mostyn J's opinion, disciplinary proceedings should adopt the test for dishonesty established by the Privy Council in Barlow Clowes, and, by extension leave Ghosh and its other adaptations to the criminal courts. His reasoning was, in summary, that the Barlow Clowes test had "overreached or superseded" Twinsectra/ Ghosh (as outlined above) by way of the Court of Appeal's judgment in Abou-Rahmah[5] in 2006 and, most recently, the Privy Council's in Central Bank of Ecuador v Conticorp in 2015, which both approved Barlow Clowes. Mostyn J commented, in respect of the latter case, that the Privy Council is "the Supreme Court in all but name, and if it propounds a legal test then we should [unless certain circumstances apply] faithfully follow it". Successive judgments had, he considered, mistaken or ignored the authority of these three cases.
Under the Barlow Clowes test, as Mostyn J clarified, the "only relevant mental state of a defendant accused of dishonesty in civil proceedings is his or her knowledge [of their actions]"; it then falls for the tribunal to consider whether the defendant, possessing this knowledge and having acted accordingly, was dishonest by the standards of the fair and reasonable person (and not of a particular cohort or profession, as suggested in Hussain v GMC).
It would be unnecessary for a disciplinary tribunal adopting Barlow Clowes to find that a defendant accused of dishonesty was actually aware that what they were doing was wrong, so it arguably represents a lower threshold than Twinsectra/ Ghosh. A tribunal could still find that the defendant knew that what they were doing was dishonest, however, as this would be "highly relevant" to its consideration of sanctions.
Mostyn J's judgment
Mostyn J conceded that it was not for him in this case to hold that Twinsectra/ Ghosh should not have been adopted by the PCC. Despite his misgivings with the adoption of Twinsectra/ Ghosh and Hussain, he was effectively bound to follow them here. He added, however, and this will likely be uncontroversial amongst legal commentators, that "the position needs to be conclusively clarified by the higher appellate courts or by legislation".
The only question which Mostyn J had to decide was whether the factual findings met the standards of Twinsectra/ Ghosh so as to justify the PCC's judgment of dishonesty. He concluded that they did not. The PCC held, for example, that the appellant had "persuaded herself" that splitting the treatment claims in the way she did was acceptable but yet, apparently, was dishonest by the standards of a reasonable person. Mostyn J allowed the appeal and quashed the findings of dishonesty on the basis that the PCC's decision in this respect was "an oxymoron". The case was remitted to the PCC to reconsider sanction.
The case does not change or modify the correct legal test for dishonesty in regulatory proceedings. It remains that modified by Hussain and David. The judgment has, however, amplified the calls for the test to be codified between disciplinary and (other) civil proceedings.
[1] R v Ghosh [1982] QB 1053, adapted by the House of Lords in Twinsectra Limited v Yardley and others [2002] UKHL 12
[2] Barlow Clowes International Ltd v Eurotrust International Ltd [2005] UKPC 37, recently approved by Central Bank of Ecuador & Ors v Conticorp SA & Ors (Bahamas) [2015] UKPC 11
[3] [2014] EWCA Civ 2246
[4]Professional Standards Authority for Health and Social Care v Health and Care Profession Council, Elizabeth Abosede David [2014] EWHC 4657 (Admin)
[5] Abou-Rahmah & Anor v Al-Haji Abdul Kadir Abacha & Ors [2006] EWCA Civ 1492