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Dr. Robert Desjardins, president of the New Brunswick Medical Society, says doctors need a respected agreement to negotiate a future agreement. (Jacques Poitras/CBC)

A judge says she will rule soon in a legal dispute between the New Brunswick Medical Society and the Alward government over billing fees.

Court of Queen's Bench Justice Judy Clendening heard arguments in the case in Fredericton on Wednesday.

The medical society, which represents 1,600 doctors in New Brunswick, is asking her to rule its 2009 fee agreement with the provincial government is binding.

The provincial government doesn't dispute the existing agreement is still in place, but argues it has the power to set the overall medicare budget and contends the judge has no role in the matter.

Wednesday's hearing was prompted by Health Minister Ted Flemming asking the medical society to start a new negotiating process on billing fees — one that would accept the government's demand for a cap on the medicare budget for three years.

The medical society balked, pointing out it has a signed agreement that doesn't expire until 2014.

Flemming insisted on a deal, according to the medical society's lawyer David Young. Otherwise, the minister said the government would explore "all avenues," Young told the court.

He said the medical society tried to salvage talks, but learned on March 12 the government had gone ahead and imposed the cap.

Finance Minister Blaine Higgs announced in the budget funding for doctors who bill medicare for each service would be cut by $18.8 million and capped at $425 million for two years.

Need 'respected agreement'

"Déjà vu, it's back to 2009," said Young, referring to a previous fee dispute with the former Liberal government when the government declared an earlier agreement "null and void."

That dispute was eventually settled out of court. But because Flemming would not commit to honouring the 2009 settlement agreement, the medical society filed the application, asking the court to rule the existing agreement is binding and enforceable.

"We need to have a respected agreement to make a stable ground on which we can negotiate a future agreement," medical society president Dr. Robert Desjardins told reporters outside the courtroom.

"If this one is not respected, what is the point of negotiating in the future?"

Flemming has since offered to put aside the cap for a year and resume negotiations.

But the medical society says it doesn't trust him.

Government lawyer Rick Williams told the court the government agrees the existing deal is valid and the government hasn't breached that.

No doctor has been deprived of what he or she is entitled to bill under medicare, said Williams.

But the government must be free to set the overall budget for medicare, including a cap, he said.

Williams noted the cap may never take effect if doctors don't bill up to that amount.

Clendening reserved her decision, but said it won't take her long to issue a written ruling.