Regulatory team advises mental health provider in judicial review success
Mills & Reeve has acted for Cygnet Health Care in a judicial review against the Care Quality Commission, the regulator of health and social care in England.
Cygnet is a leading provider of mental health services for young people and adults with mental health needs, acquired brain injuries, eating disorders, autism and learning disabilities within the UK.
Cygnet challenged the legality of CQC’s inspection reports and enforcement action taken by the CQC against various Cygnet sites on the basis of apparent bias resulting from an inspector’s historic connection to Cygnet’s hospitals. It was also found during the litigation that the CQC had not been properly applying its own conflicts of interest policy on a systemic level, including in this case. This was contrary to what the CQC had said previously.
The hearing took place on 4 and 5 December 2024 and judgment was handed down on 21 January 2025 and found in favour of Cygnet.
The judge declared that the:
- “Impugned Decisions” were tainted by the apparent bias of the inspector.
- CQC were wrong to decide the “Impugned Decisions” were not tainted by apparent bias.
- CQC were wrong not to reconsider the “Impugned Decisions”. The CQC was also ordered to reconsider one of the “Impugned Decisions”.
The “Impugned Decisions” have been declared to be affected by the apparent bias of the inspector.
Of note, the judge criticised the CQC and commented in his judgment:
“The Conflicts Policy was not followed in full. The potential for conflict arising from the use of a service by an inspector was one which CQC identified and thought about. It was of such obvious relevance that the decision to allow inspection by a former service-user was to be taken at a senior level, but it was not. It is the role of those in senior leadership to deploy long experience, overview and insight which might not be evident to those who do not have that level of responsibility. For those who should have referred the matter to senior leadership to have failed to do so is indicative of the Conflicts Policy not being taken as seriously as it should have been. Equally, the failure of senior leaders to ask and check whether the correct decision-making process was being implemented also indicates that senior leadership was not taking sufficient interest in potential conflicts. For an organisation which is entirely focussed on assessing compliance with methods, procedures and policies, these are striking features of the case.”
Mills & Reeve partner Amanda Narkiewicz headed up the team advising Cygnet with support from principal associate Samuel Lindsay on the judicial review challenge. Patrick Green KC and Jack Castle of Henderson Chambers acted as Counsel.
Amanda said: “This is a significant decision and underscores the importance of fairness in the regulatory process and serves as a reminder of the vital role that robust conflict management plays in managing trust and accountability within our regulatory system. It also illustrates the high bar for regulators when it comes to ensuring independence and objectivity of process.
We hope that CQC will heed the judge’s comments on its failure to adhere to the Conflicts Policy. All providers will want to be reassured that CQC have taken the necessary steps to ensure that this cannot happen again.”
A spokesperson for Cygnet said: “We welcome the judge’s findings and appreciate the comprehensive examination and scrutiny of the facts that have led to this outcome.
In this case, the judge found that the CQC’s Conflicts of Interest Policy was not followed by CQC’s Judith Edwards and Jane Ray (then, Inspection Manager and Head of Hospital Inspection respectively), but what’s more important is that this case revealed that CQC’s Conflicts Policy has not been followed in other cases, that “senior leadership was not taking sufficient interest in potential conflicts” and the Conflicts Policy “was not being taken as seriously as it should have been” by the CQC generally. The judge described these as “striking features of the case."
Whilst it remains concerning that this case had to be brought to court for resolution the judgment affirms the importance of the regulator ensuring its inspectors and senior leaders maintain the highest standards of accountability, honesty and transparency in the regulatory process - standards that, regrettably, were not upheld in this instance.
A robust Conflicts of Interest Policy must be effectively applied to ensure that everyone involved in health and social care can have confidence in the integrity of the regulator’s assurance systems and staff.
We remain committed to working with the regulator to consistently strive for the highest standards of care and we hope that this judgment will now bring closure to the matter for Cygnet.”
Our content explained
Every piece of content we create is correct on the date it’s published but please don’t rely on it as legal advice. If you’d like to speak to us about your own legal requirements, please contact one of our expert lawyers.