The hospital boss at the centre of Britain's worst infection outbreak was awarded more than £190,000 damages today after winning her battle over severance payment at the Court of Appeal.
Rose Gibb, former chief executive of the Maidstone and Tunbridge Wells NHS Trust in Kent, went to court after the Government withheld the payment she was offered in return for her resignation following the outbreak in which 90 people died.
In April last year, the High Court dismissed her claim to enforce the terms of the package, but she was later given permission to take her case to the Court of Appeal.
Three judges heard her appeal in March and today delivered a ruling ordering the Trust to pay her £190,284 damages plus the costs of the court hearings.
Lord Justice Sedley said: "It seems that the making of a public sacrifice to deflect press and public obloquy, which is what happened to the appellant, remains an accepted expedient of public administration."
The judge, together with Lords Justices Laws and Rimer, had been told by Anthony White QC, representing her, that the case raised important issues relating to the impact of the doctrine of ultra-vires - whether a body acts beyond its powers - on compromise agreements terminating public sector employment.
Ms Gibb left her £150,000-a-year post in October 2007, days before a highly critical report was published on the spread of Clostridium difficile (C diff) on overcrowded and dirty wards.
Because she left by mutual agreement, she was in line for a £250,000 severance package consisting of £174,573 compensation and £75,427 notice pay.
The payment was blocked after the Department of Health's intervention, although she eventually received the notice money.
The appeal revolved around whether the High Court got it wrong in finding that the Trust was acting beyond its powers in agreeing to the severance deal, and that the Trust was not "unjustly enriched" by avoiding paying her compensation for unfair dismissal as the failure to pursue such a claim lay at her door.
The damages award was for the amount of the severance package plus interest of £15,000.
Former Bucks Fizz singer Cheryl Baker, whose mother-in-law Doreen Ford died at Maidstone Hospital in Kent in 2008 at the age of 77 after contracting C.diff, reacted furiously to the news.
She called on Ms Gibb to hand over the money to the families whose loved ones died at hospitals run by the Trust while she was its chief executive.
And Ms Baker said she would be happy to join other families in contesting the decision, describing it as an "outrage" to all who lost friends and relatives through the outbreak.
Ms Baker said: "I'm disgusted at the legal system that she should be allowed that money. She should be put in prison for what she did because she was indirectly responsible for those deaths.
"It was because of her that the cleaning wasn't done properly. I think it's absolutely disgusting.
"If she had any common sense, she would hand that money over to those who lost loved ones, like my father-in-law who is now £400 a month worse off because of the death of his wife.
"It's like rubbing our noses in it. All she cares about is lining her own pocket. I lose faith in the British justice system when decisions like this are made."
She said she would associate herself with any campaign to contest the decision. She said: "I'd be happy to be a part of that and I'm sure there are lots of other people who would be too."
Speaking of how the loss of her mother-in-law is still keenly felt, she went on: "She lived with us so she was a big part of our family.
"My children have been robbed of their grandmother and I think it's an outrage that this woman has walked away with this money.
"Where is the justice?"
Lord Justice Sedley said High Court judge Mr Justice Treacy had got it wrong by letting himself be drawn into acting more as auditor than judge.
"On the scale of severance payments, not only in the private sector but in parts of the public sector, £240,000 was not on its face outlandish compensation for the arbitrary termination of a career which it was unlikely Ms Gibb would be able to resume or resurrect."
He added: "The effect of unwarranted departmental interference has thus been to trap the Trust between a rock and a hard place and to expose it, in its attempt to escape, to heavy legal costs.
"Central government (which, it seems, will be picking up the bill) might have done better to recognise that the Trust, in reaching the agreement, had been making the best of a bad job; and perhaps better still to recognise that the bad job had been the decision, which the Department does not appear to have cavilled at, to sacrifice on the altar of public relations a senior official who had done nothing wrong."
He ended his ruling: "Perhaps those reponsible will now reflect that, since such blame as the report allocated was subsequently accepted by the Trust's board - all of whom resigned following publication of the report - there had been no good reason to dismiss the CEO; and that all this money, both compensation and costs, could have been spent on improving hygiene and patient care in the Trust's hospitals."
Lord Justice Laws, giving the background to the case, said Ms Gibb was appointed chief executive officer in 2003 and in 2006 there were outbreaks of C.difficile at hospitals managed by the Trust.
In the wake of "widespread anger and anxiety", the Healthcare Commission investigated the outbreaks and measures to respond to them and produced a report highly critical of the Trust's leadership.
There was a recommendation that the Trust's board should review the leadership in the light of significant failings to ensure it was able to discharge its responsibilities to an acceptable standard.
The Trust ordered its legal advisers to report on allegations against Ms Gibb but no adverse findings were discovered and a decision was made not to remove her by the Trust's Remuneration Committee.
But at a meeting of the committee in September 2007, it was decided to end Ms Gibb's contract by a negotiated settlement before the publication of the Healthcare Commission report in October.
The £250,000 package was agreed on condition that Ms Gibb did not take any action or make a claim against the Trust.
But the Trust was then instructed by the Director-General of NHS Finance, Performance and Operations to withhold the payment.
The High Court had found that the payment was "irrationally generous and thus ultra vires".
Lord Justice Laws said the compensation was not "irrational generosity" taking into account what might have happened if Ms Gibb had been sacked and she had made a claim for unfair dismissal.
Glenn Douglas, the current chief executive of Maidstone and Tunbridge Wells NHS Trust, said: "The Trust has received the Court of Appeal's decision and is obviously disappointed that the High Court ruling has been overturned.
"We will be consulting with our lawyers to discuss our options.
"We would like to again take this opportunity to express our deep regret for what happened during the two C.difficile outbreaks which occurred while Ms Gibb was chief executive of this Trust.
"Under new management and with new procedures and strict infection control measures, we now have among the lowest C.difficile rates in the country in our hospitals.
"Our priority is, and will continue to be, to provide safe, high- quality care for our patients."
The Managers in Partnership union, which backed Ms Gibb, said the NHS handled her case "incompetently" and that it should never have reached court.
MiP chief executive Jon Restell said: "Rose and the union are not celebrating the outcome of the appeal because there are no winners.
"This case should never have come to court. It only did so because the NHS handled things so incompetently.
"The court has found that ministers in the last government and senior officials were more concerned with spin and public relations than open and mature accountability.
"As a result, the public was misled about the root causes of what went wrong.
"Rose never shunned her responsibilities and she left the Trust against her wishes. She would have remained in post to answer public concerns personally.
"She would have been able to inform and explain matters to the public in an open way. There would have been no need for a compensation payment.
"Instead the NHS acted in a way that both failed to address the concerns of the public and also distressed relatives.
"As the court itself has found, the public money wasted in defending this case, in compensation and legal costs, could have been spent on hygiene and patient care.
"MiP urges the new Government to fix the broken system of accountability in the NHS.
"This judgment makes clear that the Department of Health and employers must respect the employment rights of senior NHS managers and must use open, fair and robust procedures to hold them to account.
"Ministers now have a chance to ensure we avoid similar cases in the future."
Jon Restell, chief executive of healthcare managers union MiP, commented: "Rose and the union are not celebrating the outcome of the appeal, because there are no winners. This case should never have come to court. It only did so because the NHS handled things so incompetently.
"The court has found that ministers in the last government and senior officials were more concerned with spin and public relations than open and mature accountability. As a result, the public was misled about the root causes of what went wrong.
"Rose never shunned her responsibilities and she left the Trust against her wishes. She would have remained in post to answer public concerns personally. She would have been able to inform and explain matters to the public in an open way. There would have been no need for a compensation payment.
"Instead the NHS acted in a way that both failed to address the concerns of the public and also distressed relatives."
He added: "This judgment makes clear that the Department of Health and employers must respect the employment rights of senior NHS managers and must use open, fair and robust procedures to hold them to account. Ministers now have a chance to ensure we avoid similar cases in the future."
Ms Gibb, under the original severance agreement, had promised not to comment on the case, he said.Reuse content