GP ordered to repay corporate for breach of contract

A GP has been ordered by the District Court of NSW to repay more than $264,000, plus costs, to corporate operator Independent Practitioner Network (IPN) after quitting just 11 months into a five-year contract.

Sydney GP Dr Deepak Malhotra, who received an upfront payment of $300,000 on joining IPN in 2007, failed to prove his claim that IPN had misrepresented the amount of money he would earn through his employment (Medical Observer, 4 September).

After representing himself in court, Dr Malhotra was ordered to repay the pro-rata amount at 12% interest per annum compounded daily, plus court costs. The total amount payable was still being determined, with the two parties negotiating court costs and the interest period as MO went to press.

A counter-claim for $750,000 by Dr Malhotra for lost income due to sub-standard working conditions at IPN’s Liverpool Family Medical Centre was partly upheld with the court awarding $9320, plus costs, in his favour.

In giving his reasons, Judge Charteris said Dr Malhotra’s evidence was unreliable in part due to his poor health, indicating dialysis treatment three days per week required by the GP for a renal condition had adversely affected his memory.

Speaking to MO outside the court, Dr Malhotra said the verdict served as a warning for other GPs considering entering a corporate contract.

“You need to get a lawyer to read the contract,” he said. “Or don’t enter into a contract at all.”

IPN head of corporate development Scott Beattie said he was pleased with the outcome, revealing IPN had offered to settle with Dr Malhotra out of court for less money than was eventually awarded.

He said that, given the large upfront payments IPN made, the company had always encouraged doctors to seek legal advice before signing a contract.