116.—(1) If there is a dispute between the Local Health Board and the contractor in relation to a contract sanction that the Local Health Board is proposing to impose, the Local Health Board shall not, subject to sub-paragraph (4), impose the proposed contract sanction except in the circumstances specified in sub-paragraph (2)(a) or (b).
(2) If the contractor refers the dispute relating to the contract sanction to the NHS dispute resolution procedure within 28 days beginning on the date on which the Local Health Board served notice on the contractor in accordance with paragraph 115(4) (or such longer period as may be agreed in writing with the Local Health Board), and notifies the Local Health Board in writing that it has done so, the Local Health Board shall not impose the contract sanction unless —
(a)there has been a determination of the dispute pursuant to paragraph 100 and that determination permits the Local Health Board to impose the contract sanction; or
(b)the contractor ceases to pursue the NHS dispute resolution procedure,
whichever is the sooner.
(3) If the contractor does not invoke the NHS dispute resolution procedure within the time specified in sub-paragraph (2), the Local Health Board shall be entitled to impose the contract sanction forthwith.
(4) If the Local Health Board is satisfied that it is necessary to impose the contract sanction before the NHS dispute resolution procedure is concluded in order to —
(a)protect the safety of the contractor’s patients; or
(b)protect itself from material financial loss,
the Local Health Board shall be entitled to impose the contract sanction forthwith, pending the outcome of that procedure.