Court Of Appeal Finds Entire Agreement Clause Did Not Preclude Terms Of Superseded Contract Being Admissible To Explain Meaning Of Unconventional Term

The Court of Appeal has held that the parties agreed a binding variation to incorporate additional services (Intermediate Minor Oral Surgery, or IMOS, services) into a standard form contract for the provision of dental services, so that an earlier contract for the provision of the IMOS services was superseded. That meant that the agreement for the IMOS services could not be terminated without fault by the dentists; the ability to terminate on one month's notice under the IMOS contract no longer applied: NHS Commissioning Board v Vasant and others [2019] EWCA Civ 1245.

The variation was in writing and signed by both parties, as required by a so-called “no oral modification” clause in the standard form contract. Although the variation was in very brief terms, which did not (in themselves) explain the nature of the services to be provided under the varied contract, the court rejected an argument that it failed for uncertainty.

While the terms of the IMOS contract could not be said to be incorporated into the standard form contract, as they were not expressly incorporated by reference and the standard form contract contained an entire agreement clause, they were admissible as extrinsic evidence for the purpose of explaining the meaning of the relevant expression in the standard form contract.

The decision shows that, even where an earlier contract is superseded and no longer applies, it may be admissible to explain the meaning of an unconventional, or technical, expression in the subsequent agreement. The obvious message for those drafting contracts, however, is that it will almost certainly be preferable to ensure that the meaning of all terms is clear on the face of a contract rather than having to look to extrinsic evidence for that purpose.

Background

The defendants were dentists who provided general dental services to the claimant (the NHS, as successor to Croydon Primary Care Trust) under a General Dental Services Contract (the “GDS contract”) entered into in 2006. This was a lengthy standard form contract which specified the mandatory services each dentist had to provide. Part 10 of the contract, headed “Further Services”, contained a number of clauses which merely stated “Reserved” to indicate that those clauses had no application to the contract.

The GDS contract contained awritten variation clause, stating that no amendment or variation would have effect unless it was in writing and signed by both parties, as well as anentire...