Dishonesty After Kirschner: Is the Ghosh Test on its way out?

The Ghosh test remains the test for dishonesty in professional discipline proceedings despite the dissatisfaction with it expressed by Mostyn J in May, giving judgment in the case of Kirschner v GDC [2015] EWHC 1377 (Admin).

The dentist was charged with a very large number of failings, some of which alleged dishonesty. Of the dishonesty allegations, some were not found proved. Those that were proved related to dishonestly claiming payments under her NHS dental contract for treating three patients, benefiting in the sum of £144. She was suspended. She appealed against the finding of dishonesty and the sanction.

Mostyn J discussed at length the test for dishonesty. He found it unsatisfactory that the legal test for dishonesty in disciplinary proceedings should be different from that in mainstream civil proceedings. He commented that it was no justification that a finding of dishonesty in disciplinary proceedings has serious consequences for a professional, as a similar finding in a civil court can lead to heavy damages.

The line of reasoning that a finding in a professional discipline case is more analogous to one in ordinary civil proceedings than in a criminal trial is perhaps a little unconvincing to those who act regularly in these sorts of cases. Although a disciplinary tribunal cannot of course impose imprisonment, a professional accused of dishonesty is at risk of loss of his or her career, with its impact on income, the professional’s family, retirement planning, and possible consequences of unemployment and penury. A finding of dishonesty in professional disciplinary proceedings is serious precisely because it is a moral judgment; findings of misconduct and impairment are not inevitable but are difficult to avoid because of the line of reasoning that dishonesty implies a character flaw, a deep-seated attitudinal failing that makes the professional unsuitable for continued practice.

It is crucial that such a damning finding is made only when the panel are satisfied that the professional realised that what he was doing was dishonest. Happily, despite an extensive examination of the authorities on dishonesty from Ghosh onwards, Mostyn J was unable to conclude that the test in both types of proceedings is the same.

He referred to a number of authorities including Twinsectra Limited v Yardley and Others [2002] UKHL 12, [2002] 2 AC 164, in which the House of Lords adopted a mixed or combined test of objectivity and subjectivity in line with the criminal direction propounded in the well known case of R v Ghosh [1982] QB 1053. At paragraph 20 Lord Hoffmann stated that the principles “require a dishonest state of mind, that is to say, consciousness that one is transgressing ordinary standards of honest behaviour”. That view was support by Lord Hutton [at 35] who pointed out that for a professional a finding of dishonesty is “particularly grave” and should not be made unless he or she had realised that honest men would regard what was done as dishonest.

He went on to consider Barlow Clowes International Ltd v Eurotrust International Ltd [2005] UKPC 37, [2006] 1 WLR 1476, in which the Privy Council held that the Twinsectra test only meant that “his knowledge of the transaction had to be such as to render his participation contrary to normally acceptable standards of honest conduct. It did not require that he should have had reflections about what those normally acceptable standards were.”

The judgment then analyses a string of later cases in which the standard Twinsectra test was used, rather than the Barlow Clowes version, ending with Hussein v GMC [2014] EWCA Civ 2246 in which the Ghosh/Twinsectra test was modified to “reasonable and honest doctors [not people]”. The authorities commented on included Bryant v Law Society [2009] 1 WLR 163 where, despite the decision in Barlow Clowes, the Court declared itself bound by Bultitude v The Law Society [2004] EWCA Civ 1853 to apply the standard Twinsectra test.

One further concession to the civil standard was noted. In Professional Standards Authority for Health and Social Care v Health and Care Professions Council and Elizabeth Abosede David [2014] EWHC 4657 (Admin) Popplewell J accepted that there were two different tests available but in the absence of argument to the contrary proceeded on the basis that the Twinsectra/Ghosh test was the appropriate one to be applied, albeit further modified to make clear that the civil standard of proof applied to both of its limbs.

Mostyn J pronounced himself very unhappy about all of this. He stated, “In my opinion there should be but one test for dishonesty in all civil proceedings, whatever their nature. That test should be as propounded by the Privy Council in Barlow Clowes…” However, he held that he was bound by the decisions in Bryant and Hussein, and that the test is:

“The tribunal should first determine whether on the balance of probabilities, a defendant acted dishonestly by the standards of ordinary and honest members of that profession; and, if it finds that he or she did so, must go on to determine whether it is more likely than not that the defendant realised that what he or she was doing was by those standards, dishonest.”

Mostyn J went on to find that the dentist had not acted dishonestly. Her evidence was that she had claimed as she did because she had been told (incorrectly) that she was entitled to do so. The PCC did not make any finding that this evidence was false. Mostyn J said:

“were it to have done so it would have been incumbent on it to have spelt this out with the utmost clarity. If a defendant is to be fixed with a finding that he or she has given deliberately false evidence then it is elementary that he or she must be told with pitiless clarity why and how”.”

The PCC’s reasoning that the dentist had simultaneously persuaded herself that the claims were acceptable whilst also knowing that she was not entitled to make them was ‘internally inconsistent and incoherent’. In the absence of a finding that the dentist had given false evidence about her knowledge of the claiming procedure or that she had been given incorrect information but subsequently discovered the true position, no finding of dishonesty was possible.

Mostyn J therefore allowed the appeal, quashed the findings of dishonesty, and remitted the case to the PCC to reconsider sanction.

It remains to be seen what will happen when the issue of dishonesty next makes its way to the Court of Appeal or even the Supreme Court, but for now all FTP panels are bound to apply the Ghosh test in disciplinary cases.

A version of this article was delivered at the 2 Hare Court Professional Discipline seminar on 10 June 2015.