Gill, R (on the application of) v Hearing Aid Council

MR JUSTICE ELIAS: This is an appeal against the determination of the Hearing Aid Council on 5th December 2003, when it found the appellant guilty of four charges of breaches of the Hearing Aid Code of Practice.

The background is as follows. The appellant, Mr Gill, is a registered hearing aid audiologist. He was the managing director and also the principal shareholder of the Harley Street Hearing Aid Centre. The business started up in 1986, it became incorporated, and by 2003 it had four centres of its own and it operated from 30 or so other premises, such as opticians' offices and doctors' surgeries, where audiologists would, from time to time, go and see clients.

There were certain complaints that were made to the Hearing Aid Council from some of the clients. These complaints having been received, the Council became aware that the company was acting in breach of the code of practice. They sought explanations from the appellant about what they perceived to be these breaches, but there was no response. Subsequently, one of the appellant's fellow directors, who was also disciplined in the same set of proceedings, became a witness for the Council and explained some of the practices that had been going on in the company to the Council.

When the proceedings began it is right to say that a number of charges were made against Mr Gill and they alleged not only breaches of the code, but also that in various ways he had acted unethically and improperly. Indeed, I am told that the case was opened, initially, on the basis that he had been involved in some kind of scam. It is right to say, in fairness to Mr Gill, that those charges were not ultimately pursued when the evidence became clearer. It is not suggested that he acted dishonestly or fraudulently or anything of that kind, but, as we shall see, he did act in various ways in breach of the code of practice, and he must have been aware of that fact.

The four charges to which he ultimately pleaded guilty were as follows. First, that at various times between 1st December 1995 and 1st January 2003 he had contravened clause 3 of the code. Clause 3 requires that:

The second charge to which he pleaded guilty was infringing clause 11. That is a clause which requires that before supplying a hearing aid, or before the client has entered into any commitment, dispensers must provide the client with, amongst other matters, information in writing about the make and model of the aid to be supplied.

The third guilty plea related to allegations of breaches of clause 19 of the code, which requires dispensers to give their clients the benefit of any guarantee offered by the manufacturers of the goods.

Finally, there was a plea to breach of clause 21 of the code, which requires the dispensers to deal with reasonable expedition with enquiries made by the registrar in connection with complaints made to the Council about the conduct of a dispenser.

The breaches of clauses 3, 11 and 19 all arose out of a particular practice which was operated within the appellant's organisation. What HHAC did was to substitute their own logo for those of a particular manufacturer. I am told that is something which a number of other larger organisations also do. But the matter went a little further than simply putting the particular logo on a specific model from a particular manufacturer. Apparently what happened was that an audiologist would see a client, discuss options with that client, and then advise as to the appropriate aid to be used. There was a procedure adopted internally whereby a reference would be made to the appropriate aid, but Mr Gill would then select, from a number of possible makes and models, the appropriate hearing aid that would fit into the particular category identified by the audiologist.

The result of that was that the client was not necessarily obtaining the best advice within clause 3. Indeed, a decision of some significance would be taken, not by the person who was dealing directly with the client, but at a stage removed, often as a result of a conversation over the telephone.

The basis of the plea, it must be emphasised, was that there was no intention that he would benefit financially or commercially from this practice, but that he intended, in certain ways, to simplify the client's choice of hearing aid, as well as to promote the brand identity of his company and thereby obtain client loyalty and achieve a more prominent market position. To that extent there was a commercial objective. But, in addition, the practice meant that he was inevitably in breach of clause 11 because there was a failure to identify the make and model of the aid to be supplied. Indeed, as I have indicated, even from the logo put on the model supplied it would not be possible for those in the industry to be able to identify what the particular model and make was.

There were also difficulties with the guarantees arising from this arrangement because instead of giving the guarantee from the particular manufacturer, HHAC provided its own guarantee. It is right to say that, apart from perhaps one or two cases where administratively things went awry, it did seek to replicate in its own guarantee the benefits that would have been given by the guarantee from the manufacturer.

I have heard some submissions from Mr Donne QC, who ably urged all matters on behalf of Mr Gill, that in practice there were no significant difficulties caused to any client as a result of this particular practice. He accepts that legally there might be difficulties - I think, in fact, are difficulties - if, as has happened, HHAC went into liquidation. That leaves the clients without any effective redress against HHAC and obviously with difficulties against the manufacturer.

I am told that in practice the manufacturers will know that they have supplied a particular product to the client, because that will be on the records, and will generally meet their obligations, perhaps always so. But there is no doubt that the client is left in a weaker position as a matter of law, and to the extent that they remain protected, this results from the goodwill of the manufacturers rather than because of any obligation that they may have.

There may also be some difficulties faced by individuals who are not operating in an area where HHAC is and who, in other circumstances, would have been able to make direct communication with the manufacturer. Again, Mr Donne suggests that they could go to another supplier and it would quickly be discovered who the manufacturer was, and, in the way I have indicated, the manufacturer would, out of goodwill, respect the guarantee. But that presupposes that the clients would realise that that was a possibility.

In any event, it must be clear that whatever the practical protection that may still be available to clients of HHAC, their legal position was weakened and the practical solutions could not either be guaranteed. Accordingly, it is clear that there are going to be some genuine concerns that the Council would have about those matters.

The pleas of guilty to these particular charges were made after an initial hearing which had been commenced in September 2003. Evidence had been given at that stage, and it is right to say that following the consideration of that evidence it appears to have become clear that the allegations of dishonesty or fraud or unethical practices were not properly sustainable and, quite rightly, they were not pursued.

There had been an indication from Mr Gill's lawyers that they might be willing to plead to the, if I can put it this way, the non-ethical charges, the breaches of the code, if the complaints about ethical misbehaviour were not pursued. That was not acceptable to the Council at the time, perfectly properly so if they thought, as they plainly did at that stage, that there may be some substance in the allegations of noncompliance with ethical principles.

However, between September and the hearing in December, when there was an admission of guilt in relation to these four charges, there were discussions which ultimately led to the outcome which I have indicated, on the basis of plea which was accepted by the Council.

The determination of the disciplinary body is relatively brief. It does little more than recount that it has considered the mitigation and the factual basis upon which the pleas are tendered. The penalties available are erasure, suspension, financial penalties of up to £5,000 or admonition. They are set out in section 3 of the Hearing Aid Council (Amendment) Act 1989.

If a person's name is erased from the register then they can seek to have it reinstated from one year after the date when it is erased. In this case the penalties imposed were, in relation to the breach of clause 3, 3 months' suspension and £5,000. In relation to the breaches of clause 11 and 21, £5,000, and in relation to the breach of clause 19, £3,000. There was also an award of costs in the sum of £25,000. The challenge is to these penalties.

The principal concern is with the suspension of 3 months. Mr Donne made, essentially, three points in relation to this. First, he indicated that his client had been led to believe, as a result of a conversation between his client and the registrar, that there would be no suspension. Apparently it had been indicated to him that there had not been suspension for infringements of this clause in the past.

There is a dispute as to whether that was said or not. Mr Donne has indeed, in any event, fully accepted that it would not be open to the registrar to have fettered the discretion of the Council as to what the appropriate penalty would be, and I am sure the registrar would not have said such a thing. But in conversations of this kind it may well be that there was some kind of misunderstanding as to exactly what the registrar was indicating. No doubt he was trying to be helpful in the course of discussions with the appellant. In any event, I am told that there are examples of cases where individuals have been erased from the registrar for breach of clause 3.

Secondly, and perhaps more importantly, Mr Donne submits that given the basis of plea, it was inappropriate to impose this suspension. The original charge had alleged that the practice was being carried out for a financial benefit, and that was not the basis of the plea. It was accepted that Mr Gill had not prioritised, to use a rather ugly word, the client's interests, but there was no financial dishonesty involved.

Thirdly, Mr Donne submits that there is an inconsistency in the approach of the Council. They had been told that the appellant wished to remain in practice. Indeed, he is now in practice through a separate company. I note in passing that he has undertaken to meet obligations to prior customers, in relation to the servicing and dealing with difficulties arising from their aids, through the new company, and that is very much to his credit. But he says that the Council realised that he wished to stay in practice and that that has been frustrated by the imposition of this 3 months' suspension.

In fact Mr Gill has started a company with four other audiologists and other staff, but his involvement is very important, both because of his experience and because in fact he generates something like 30 per cent of the turnover of the company. Without him, even for 3 months, it is said, the business is going to be in dire financial straits.

I must bear in mind two matters in particular when considering the penalty imposed in this case. The first is that I am not here to substitute my view for that of the Council. I have to decide whether or not the penalty they impose can be said to be wrong.

Equally importantly, I have to recognise that those involved in running the Council will have a far closer and more realistic and experienced knowledge of the way in which this business operates than I will ever have. That is not to say that in an appropriate case the courts cannot interfere, but it is to say that they must do so with care and circumspection where a body of professional men are considering what is the appropriate penalty to be imposed on one of their peers for breaches of the professional rules.

In this case I am not satisfied that the sentence could be said to be improper. I am told by Ms Clover, and I accept, that this was a very significant disciplinary investigation as far as the Council was concerned. It must be recognised that the breaches had been going on for a considerable length of time. It must also be recognised that it would have been plain that the code was being infringed. Whether that was consciously recognised or not I do not know, but it would have been clear to anyone reading the code that the practice being adopted could not be said to be consistent with the requirements in the code.

Moreover, an acceptance that there has not been the best advice provided to clients is an acceptance of a professional breach of some importance. It is not, as I have emphasised, put in terms of a breach of ethical obligations, and the motives, no doubt, were perfectly good motives. But, nonetheless, it seems to me that the Council were fully entitled to treat this as a matter of some gravity and to reflect that in the sentence which they passed in this case.

The suspension period could have been longer or shorter. It may be that another committee would have chosen not to suspend, I know not, but I cannot say that the decision taken in this case was wrong and ought to be the subject of any interference by this court. It must also be borne in mind, in relation to this, that the appellant was the moving force behind the company that had adopted this policy over such a period of time.

Equally, in relation to the financial penalties, the contention here is that it cannot be appropriate to fix the maximum penalty in relation to breaches of clauses 3, 11 and 21. The argument is that by analogy with the criminal law, where somebody pleads guilty, even if it is relatively late in the day, there will always be some credit given for that and some reduction in the penalty that would otherwise be imposed. I accept that that is almost always the case, but it seems to me there are certain factors here that one has to bear in mind.

First, as I have said, in relation to clauses 11 and 21 there can be no doubt that there were infringements. The infringement in relation to clause 21 was a matter of some importance because if there is no response to communications from the Council then it is very difficult for them, effectively, to carry out their job at all. There appears to have been a failure to communicate for some time in this matter. As I have indicated, it was only, ultimately, the actions of a fellow director that put the Council in the picture. So that this was a deliberate breach of the rule and there could be no proper answer to it.

Similarly, in relation to clause 11, there was a breach of the obligation to provide the details of the make and the model and it was not just a matter that if one knew the code, as it were, adopted by the company, one could immediately identify the make and model. The problem was that even with that information it would still not be possible to identify which particular make or model had been utilised. Moreover, it was open to the Council to impose suspension in relation to these other clauses as well.

So, to that extent, it is a little misleading to talk about this being the maximum penalty. It is the maximum fine, but not necessarily the maximum penalty. The indication that the Council did not simply automatically impose the maximum is demonstrated by the fact that the fine in relation to the breach of clause 19 was smaller.

For these reasons, therefore, and as I say, bearing in mind that it is not my job to decide what the penalty should be, but only to decide whether it can be said that the Council got it wrong, I do not think it can properly be said that the Council got it wrong.

I hope that Mr Gill's business is successful in the future, but it cannot be right that because the Council gave some indication that they were wanting him to continue in business and were aware that that was his wish, that they could, in any way, fetter their obligation to impose what they felt was the proper penalty to impose, in the public interest, in this case. I do not think there is an inconsistency in accepting his wishes for the future and wishing him well in respect of them, but at the same time recognising that he had to pay the penalty for what were clear and plain breaches of the code.

MS CLOVER: My Lord, there is an application for costs on behalf of the respondent for today's matter. I do not have a precise breakdown, but the global figure is £3,500.

MR JUSTICE ELIAS: That sounds relatively reasonable in all the circumstances. Do you oppose that?

MR DONNE: Just forgive me for a moment, I was not given notice of the figure.

MS CLOVER: I am told that is a figure exclusive of VAT, so the total figure is £4,250.

MR JUSTICE ELIAS: Is VAT awarded? I can never remember whether it does or not.

MR DONNE: Yes, we accept that figure, my Lord.

MR JUSTICE ELIAS: I think that is without VAT.

MS CLOVER: It has gone up.

MR JUSTICE ELIAS: I can never remember whether VAT has to be included in my --

MR DONNE: If there is any difficulty --

MR JUSTICE ELIAS: Can I say £3,500 and if the usual rule is that VAT is added on to that then it will be added on and if not it will not. (Discussion with clerk) I am told it does need to include VAT so I am afraid that that is the £4,000 and whatever --

MS CLOVER: It was £4,250 in that case.

MR JUSTICE ELIAS: Thank you both very much.