Court resolution on contract matters

Contract signing

Court resolution on contract matters

On Dec. 4, 2017, Doctors Nova Scotia (DNS) filed Notices of Application with the Nova Scotia Supreme Court to settle two contract issues with the provincial government. Attempts over the previous 14 months to resolve these contract issues outside of the courts have failed.

Update: DNS legal action delayed by government

On May 16, 2018, legal representatives for Doctors Nova Scotia (DNS) and the provincial government appeared in court before Justice Michael Wood to argue the government’s motion to have two of the three outstanding legal matters consolidated and proceed by way of a full trial. The two matters at hand were the association’s claim that the government is in breach of the Master Agreement by refusing to pay the $4 million in benefits funding owed to DNS and by using unapproved Alternative Payment Plan (APP) contracts.

After hearing both sides, Justice Wood found in the Attorney General’s favour. The two matters will now become one and will proceed by way of a full trial.

Doctors Nova Scotia is disappointed with the decision because it will result in years of unnecessary delay in resolving these simple contract matters. As the association has said from the beginning, having unresolved legal matters does not serve the best interests of doctors or Nova Scotians.

This situation creates an uncertain environment for physicians, both those currently practising in the province as well as potential new physician recruits to Nova Scotia. That is why the association sought help from the court to resolve these issues and had hoped to have a court bring resolution expeditiously.

The government’s successful motion to have the matters consolidated and proceed by full trial will result in significant delay and prolong the uncertainty in Nova Scotia’s physician recruitment environment. Doctors Nova Scotia continues to believe the government's position is ill-considered and will continue to pursue resolution in order to protect the interests of physicians in this province.

Rather than these two legal matters proceeding efficiently by way of an Application in Chambers (affidavits) as set out by DNS, it is anticipated these matters will not come to trial for several years.

Doctors Nova Scotia has a separate court appearance on June 21 to address the association’s claim that the government is also in breach of the association's legislated role as sole bargaining agent by negotiating the terms of APP contracts directly with physicians. The association expects a decision on this matter by the end of the summer.

In early January, the provincial government applied to the Nova Scotia Supreme Court to consolidate the matters and proceed by full trial. The court will set dates to hear the government’s application on January 15, 2018. Doctors Nova Scotia views the government’s action as unfortunate - it will cause a significant, unnecessary delay to resolving the matters and prolongs uncertainty in the physician recruiting environment. 

Government breaches contract

Under dispute are the government’s use of unapproved contracts for Alternative Payment Plan (APP) physicians and monies owed to DNS for the physicians’ health and dental plan and other benefits.

The provincial government has breached its contract with physicians. Despite the association’s attempts to resolve the issues outside of the courts, government officials have not been willing. At a time when Nova Scotia is struggling to recruit physicians and keep the ones it already has, government’s refusal to honour its contractual commitments sends a poor message to the province’s doctors. Taking legal action should demonstrate to physicians already practising in the province – and to those who might consider coming – that DNS is committed to standing up for physicians’ interests.

Contact DNS before you sign contracts

In order to protect physicians’ interests, DNS is advising all physicians to contact DNS before signing any contracts and/or deliverables with the NSHA or with government. Doctors Nova Scotia’s Physician Advisory Team will work quickly to mitigate any risk and ensure there is no disruption in care or physician payments.

Public support of doctors

Public polling suggests that Nova Scotians strongly support Doctors Nova Scotia’s position. In a telephone poll conducted by Corporate Research Associates in October:

  • 83% of Nova Scotians support DNS asking the courts to settle the issue of Government not following previously agreed-upon contract terms for Nova Scotia’s doctors.
  • 86% of Nova Scotians support DNS asking the courts to settle the issue of government withholding monies owed to the association for physicians’ health benefits. 
  • According to polling, support for physicians stems from the public feeling the agreements should be honoured and the disputes settled to address the need for more doctors in the province. In the case of physicians’ health benefits, support also stems from perceptions of doctors deserving the benefits and needing to be fairly compensated.

The bottom line

Doctors Nova Scotia aims to resolve these contract issues in order to clear the air with the provincial government so that all parties can move on to solve some of the health-care system’s more significant challenges, as outlined in the association’s recent report Healing Nova Scotia: Recommendations for a Thriving Physician Workforce. 

These contract issues are a distraction from the real work needed to strengthen Nova Scotia’s health-care system. Proceeding with the lawsuit allows physicians to focus on what’s really important: their patients.

In-depth: Unapproved APP contract templates

In the 14 months leading up to DNS filing Notices of Application with the Nova Scotia Supreme Court, the government had unilaterally deviated (and continues to deviate) from the previously negotiated APP contract templates. In some cases, the government started to send unsanctioned contracts to physicians for signature. In other cases, the government started to ask physicians to sign a deliverables document without an accompanying contract.

Government took this approach without DNS’s approval or knowledge and, worse, without the knowledge of the physicians who were asked to sign the unsanctioned contracts and deliverables documents.

Both the unsanctioned contracts and the deliverables-only approach expose physicians to unnecessary risk. Physicians could see some of their Master Agreement negotiated benefits refused – such as programs supporting professional liability insurance or continuing medical education, or the 1.5% annual medical services unit rate increase for 2018/19. It is also unclear what process is available to these physicians in the event that they are not in agreement with the government or the Nova Scotia Health Authority (NSHA) about the contract. Where there is no contract at all, government and the NSHA are also exposed to unnecessary risk (for example, neither the accountability mechanisms nor the notice/termination requirements are clear).

The government refuses to revert to the approved contracts. Doctors Nova Scotia has made every attempt to resolve this, without success.

In-depth: Government withholds $4 million of funding 

Government owes 12 months of funding, equaling more than $4 million, to DNS for physicians’ health benefits. These funds are used to support physicians’ health and dental plan, parental leave and the professional support program. Despite its contractual commitment to make monthly benefits payments as part of the 2015 Master Agreement, the government refused to do so for the first 12 months of that agreement. It now owes DNS more than $4 million.

Without these payments from the government, DNS has had to deplete the contingency fund that enables the association to maintain these important health programs for doctors. 

Why would the government take this approach? It has taken exception to the association legally retaining a contingency fund for the benefits programs DNS administers under its contracts with government.

As part of good governance and a prudent fiscal management strategy, the DNS Board of Directors had built up a contingency fund to ensure that physicians’ benefits are protected from changes in the political and health-care environments. Doctors Nova Scotia has had to use the contingency fund twice in the past two years to maintain these programs for doctors, when government stopped flowing funds. In the first instance, government repaid the contingency fund.

Doctors Nova Scotia served government with notices of intended action on Oct. 3, 2017, which provided the two months’ notice required before these Notices of Application could be filed with the court. The government did not take that opportunity to resolve the issues outside of the court.

In order to protect physicians’ interests, DNS is advising all physicians to contact the Physician Advisory Team before signing contracts and/or deliverables with the NSHA or with government. The team will work quickly to mitigate any risk and ensure there is no disruption in care or physician payments.


Kim Oakley
Compensation manager, physician advisory team lead
1-800-563-3427 ext. 4924
Brent Andrews
Physician advisor (Zone 1-Western)
902-225-8577 (cell)
1-800-563-3427 ext. 4901
Derek Stewart
Physician advisor (Zones 2-Northern and 3-Eastern)
902-565-4568 (cell)
1-800-563-3427 ext. 4931

Next steps