Eastern Health sent a letter to breast cancer patients to tell them about a lawsuit regarding botched laboratory tests knowing that the letter was misleading, the acting head of the health authority said on Tuesday.

Louise Jones, acting CEO at Newfoundland and Labrador's largest health authority, told the inquiry looking into the faulty hormone receptor tests that the letter was sent out in August 2007 to comply with a court order.

The inquiry led by Justice Margaret Cameron is looking to how hundreds of breast cancer patients got wrong results on hormone receptor tests.

Eastern Health was ordered by the courts to send a letter to affected patients, informing them that a class action lawsuit had been filed against the authority regarding the faulty tests.

The Newfoundland Supreme Court certified the class action suit, involving hundreds of patients and patient's families affected by the inaccurate testing, in May 2007.

The Eastern Health letter referred to "breast cancer screening" tests, which are different from the hormone receptor tests that were the focus of the class action. Screening tests determine whether a patient has cancer; hormone receptor tests are used to determine the course of treatment a cancer patient should receive.

When worried patients started asking questions, oncologists and surgeons wrote their own letter to administrators at Eastern Health, saying the reference to screening tests was misleading and confusing.

Testifying for a second day on Tuesday, Jones told the inquiry that Eastern Health knew there was a mistake in the wording before the letter was sent, but that the authority's insurance lawyer Dan Boone told administrators they weren't allowed to change it.

"There was nothing that we were going to do or could do about what the wording of that particular court-order had been," she said.

The authority stayed silent about the mistake even after patients started receiving the letter, Jones said.

"What, if anything, did Eastern Health do to try and correct this misinformation that had gone out in this letter?" Inquiry lawyer Sandra Chaytor asked Jones.

"We didn't do anything with the individual patients," Jones said.

"So, they weren't recontacted, you didn't send out another letter, or put any public announcement in the newspaper or anything like that?" Chaytor asked.

"No," Jones said.

The hormone receptor tests of 1,013 patients done between 1997 and 2005 are at issue in the inquiry. Of the 322 who had died by 2007, 108 had received inaccurate test results.