The increased exposure to principal dentists when it comes to vicarious liability highlights the need to consider more than just their own indemnity when it comes to protecting themselves in a world of changing litigation risks.
This week news broke that a principal dentist, Dr Croad, who had retired from clinical practise over 20 years ago was found to be liable for compensation awards and claimants’ legal costs despite having sold his practice 7 years prior.
The alleged negligence pertained to treatment provided by two self-employed associates working in his practice before he sold it. Unbelievably, Dr Croad did not have any indemnity in place which would cover defence costs or compensation following the activities of his associates at the practice. This meant he had no choice other than to fund this case out of his own pocket to the tune of around £100k to compensate the patient.
Many of the principal dentists that we provide either Indemnity to or Practice Insurance to are understandably anxious to know more about the risks they face as an owner of a dental practice following this case.
Breakingbury v Croad 2021
This recent court judgement represents a step in the direction of a process which has slowly been moving along for a little while – to hold practice owners as ultimately liable for all care provided within their practice, including treatments provided by their self-employed associates.
- 2000 – Dr Croad retires from clinical practise
- 2000 – 2012 Dr Croad retains ownership of the practice
- 2008 – 2012 – Treatment provided to patient by two self-employed associates
- 2012 – Dr Croad sells the practice
- 2019 – Claim is first reported to Dr Croad
- 2021 – Court holds Dr Croad as liable for the activities of the two self-employed associates for treatment provided between 2008 – 2012
The judge based his decision not specifically on the claim relating to the treatment, but the issue of whether a “non-delegable duty of care” existed between the practice owner and the patient and whether the practice is vicariously liable for the errors and omissions of the treating dentist(s).
This recent judgement potentially has huge implications for principal dentists and may create a precedent that triggers profound change in this industry when it comes to appropriate indemnity cover.
The term ‘vicarious liability’ means that a business can be held responsible for the negligent errors and omissions of individuals working within their organisation. This is something many policyholders at All Med Pro will be all too aware of as we recommend this to our principal dentists when they hold their personal indemnity or practice insurance with us.
Most traditional employer-employee relationships would almost always lead to the entity being held vicariously liable for the acts and it is almost certain the court will find the practice owner vicariously liable for the negligent acts and omissions of employed dentists, hygienists or dental nurses.
In recent years we have started to see an increase in practice owners being held vicariously liable for the self-employed associates. The dentists in this case were deemed to be in a position akin to employment.
Frequently Asked Questions
- I have been a principal dentist for several years but have never purchased Vicarious Liability cover. Is it possible to have cover backdated? It may be possible to provide backdated cover, depending on which provider you are with. This cover is called “Retroactive Cover” and is designed to cover all acts and omissions which arise after this date. At All Med Pro, we have been able to provide a retroactive cover of over 20 years in certain cases.
- I have just bought my first practice, can I still be held liable for treatment provided before the purchase? In the event you purchase a limited company from the seller then the liabilities will carry forward to you as the new owner. In this situation, you could be held liable for acts and omissions that pre-date your ownership. All Med Pro supports many dental practice buyers by providing Vicarious Liability cover and we have also been able to provide backdated retroactive cover to support the historic period where required.
- How do I protect myself after I sell my practice? Cover for claims arising retrospectively after the sale of the practice can be catered for in two ways. There are typically two types of Indemnity cover available; Claims Occurrence or Claims Made. In the event you hold Claims Occurrence cover, you will automatically benefit from unlimited retrospective cover for treatment provided during the policy period, that arise after the sale of the practice. In the event that you have a Claims Made policy, you will need to check that your policy provides Run-Off cover or an Extended Reporting / Notification Period for treatment provided during the policy period which leads to a claim arising after the sale of the practice. Not all Claims Made policies provide this cover. All Med Pro are well placed to provide impartial advice to policyholders around the benefits of both of these covers as we are one of the few Insurance providers that can offer both Claims Made and Claims Occurrence cover to dentists.
For dentists looking for advice around Vicarious Liability cover and how we can help please call us on 0203 757 6950 or book an appointment with one of our experienced advisors today.
For dentists that find themselves suffering with anxiety as a result of this court case you can contact ConfiDental on 0333 987 5158.