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RE: THE POST OFFICE GROUP LITIGATION
ADVICE ON SETTLEMENT
Background
I have been informed that Post Office is considering the possibility of settling the group
litigation. Included among the Claimants are 61 in number (of a total of 555) who have
been convicted of, or have pleaded guilty to, criminal offences against Post Office.
By way of background, I have been told that, although consideration of settlement is in its
early stages, any settlement will most likely take the form ofa financial payment. Possible
structures for this payment include:
a. The payment being made on a Claimant by Claimant basis, depending on the
individual merits of each claim.
b. It could be a settlement pot that is distributed in accordance with agreed criteria, with
each Claimant’s case being measured against that criteria to determine how much
compensation should be awarded.
c. It might be that a single lump sum payment is made to the group, which is then
distributed among the Claimants as they see fit, but, if that happens, some of that
compensation might end up with a convicted Claimant (albeit without Post Office’s
knowledge or blessing).
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Tam told:
a.
Some or all of the Claimants are likely to seek public apologies or admissions of
wrongdoing from Post Office in addition to financial compensation.
It is likely that a settlement will contain standard non-admission of liability provisions;
There is a risk that any payment will likely be portrayed publicly as a success for the
Claimants, and the media may nonetheless interpret this as an admission of fault by
Post Office.
Post Office does not believe that any of the convictions are unsafe or that compensation
is required in relation to any claim for malicious prosecution or any similar claims
arising from any Claimant’s prosecution (as opposed to a claim arising from their
commercial relationship with Post Office).
However, Post Office wishes to understand the risk to the safety of a conviction that
might be caused by a settlement that directly or indirectly awards some compensation
or other benefit to a convicted Claimant.
The Horizon Issues Trial is still ongoing, and it is estimated that a judgment will not be
delivered until about September.
T understand that in the civil jurisdiction, where there has been a settlement, or even where
there is the possibility of a settlement, Post Office would be under a duty to notify the court
about it, as that might avoid the need for a judgment to be delivered. Post Office has lodged
(or is about to lodge) an appeal against the substantive issues judgment in the Common
Issues Trial.
Tam asked to advise Post Office on the risk to the safety of any conviction if Post Office
enters into a settlement with any or all of the Claimants.
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Discussion
7. Because no structure for any settlement has yet been decided, far less whether in principle
any settlement negotiations should be commenced, this advice is inevitably in the abstract.
The single question is whether settlement risks, or is likely to risk, the safety of past
criminal convictions. The nature of this advice may, I understand, even influence the
decision whether to attempt a settlement.
8. As I pointed out in my 14 April 2019 Advice, in the course of his judgment in the Common
Issues Trial, the judge made clear that the High Court action had “no jurisdiction or
involvement in such criminal matters”.!
9: The conclusions in that Advice are worth repeating. The judge’s factual findings regarding
disputed Branch Trading Statements did not impact on the safety of past convictions,
because (1) they were based on his application and interpretation of the law of contract to
the contracts that existed between Post Office and the Claimants; (2) the judgment and his
factual findings were not binding on the Court of Appeal Criminal Division or even
persuasive authority, and so they did not impact on criminal matters, as the judge observed
himself; (3) each past conviction had been founded on facts specific to that case, and in any
future appeal or on any reference made by the CCRC the safety test would have to be
applied according to the issues, and the evidence heard, in each case and based on any fresh
evidence the Court of Appeal permitted to be adduced before it.”
10. While the Common Issues Trial judgment has in my opinion no bearing on the safety of
convictions, the issues being litigated in the Horizon Issues Trial and in any trials that are
to follow may do so in the sense that they could provide new evidence and potential fresh
1 Common Issues judgment para 10
? Advice 14 April 2019 para 90
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avenues of enquiry supporting an eventual application to appeal or a reference by the
CCRC, as I intimated in my earlier Advice.*
11. It is not for me to advise on the strategy of any settlement and when and in what
circumstances any offer to settle should be made. That must be a matter for Post Office’s
commercial law advisors to advise. I am directing my attention solely at the potential risks
to the safety of criminal convictions in settling (or even attempting to settle) the 61
convicted Claimants’ claims against Post Office.
Admission of wrongdoing and public apology
12. The first point is an obvious one. If Post Office insists on no admission of liability, then
there can be no admission of wrongdoing. Any admission of wrongdoing in relation to any
convicted Claimant, however couched, could risk one or other Claimant attempting to
make an application out of time for permission to appeal to the Court of Appeal on new
grounds arising from the admission and/or the CCRC acting on it, and is to be avoided.
13. By contrast, while a public apology can be carefully crafted, either bearing no hint of
acceptance of fault or bearing a total denial of fault, it might nonetheless be a PR disaster.
That particular risk will have to be for others to advise Post Office. A carefully worded
apology may not realistically impact on the safety of any conviction, but any apology that
goes to any substantive issues in the litigation, however felicitously worded, might be
interpreted as an implication of wrongdoing and is also best avoided so as not to encourage
any individual to seek to find new grounds to launch an appeal and/or the CCRC to
investigate the case further and make a reference.
14. Iam, however, unable to assess the risk to the safety of any conviction in either instance in
the abstract, because I cannot foresee the nature and terms of any admission or apology to
3 Advice 14 April 2019 paras 32-41
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assess its likely impact. My advice is, instinctively, either might present a potential
provocation to the individual Claimant or the CCRC.
Financial compensation
15. Financial compensation presents more difficult problems. At present, I presume any merits-
based settlement is capable of being gauged by what the judge ruled in the Common Issues
judgment (which dealt in the main with contractual issues). As noted above, an early
settlement is likely to prevent any judgment on the technical Horizon issues. It is the
outcome of that judgment (if adverse) that is likely to provide any fresh grounds of appeal
or provide “the technical aspects” of the litigation which the CCRC is awaiting, about
which the judge spoke in the Common Issues judgment and is one outcome I assume that
Post Office is seeking to avoid.*
16. lam therefore assuming that any settlement negotiations begun and/or completed before
the Horizon Issues Trial judgment, and certainly before any claim for malicious
prosecution, or any other action related to the prosecution of the Claimants, is heard and
judgment given, is likely to be advantageous from Post Office’s point of view, because any
settlement is likely (if at all) to be negotiated on the basis of an assessment of the findings
arising from Post Office’s commercial relationship with the Claimants.
17. Any settlement involving financial compensation based on individual merit implies that
consideration would necessarily be given to the individual Claimant’s alleged loss or
damage in contract, in particular the judge’s finding that Post Office’s reliance on Branch
Trading Statements as a settled statement of account at the end of a particular branch
trading period could not be supported where the Claimant sought help from the Helpline.*
* Common Issues judgment para 10
> Common Issues judgment paras 1115-1116
18.
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A Claimant who was convicted of, or pleaded guilty to, criminal offences against Post
Office will have been sentenced, and in many cases subject to compensation or confiscation
orders. Though those orders are geared towards different ends (compensation to the
individual and confiscation to the State) they will have been sought by Post Office as
prosecutor and ordered by the Court. In the case of a compensation order, because Post
Office has proved a calculable financial loss or deficit by reason of the theft, fraud or false
accounting; in the case of confiscation, because the offender has benefited from criminal
conduct.
In the circumstances envisaged here, as I understand it, settlement of a convicted
Claimant’s case on the merits could presumably only reflect his contractual loss and
damage pleaded in the substantive claims made in the litigation, and presumably be
assessed according to the judicial findings made thus far. There is, however, in my view, a
conflict in principle between negotiating a settlement with such a Claimant in the course
of the group litigation and Post Office, as prosecutor, having sought and obtained against
that Claimant a conviction for an offence/s of dishonesty, and a compensation order to
reflect Post Office’s loss, or a confiscation order to reflect the criminal benefit, over and
above the sentence of the Court, in the course of the criminal justice process.
Essentially, they are the same issue: the commercial/contractual relationship between the
Claimant and Post Office, but, in the case of the convicted Claimant, the conviction or the
plea of guilty proves to the criminal standard that the Claimant breached that relationship
(in a non-technical sense) by acting dishonestly.
If Post Office was seen to be enthusiastic to negotiate, and did negotiate, financial
settlements with convicted Claimants, there is a palpable risk that someone (a Claimant,
the CCRC or a member of the public) will argue that the Post Office’s conduct in the
criminal trials of Claimants benefiting from a settlement is incongruous, because it is
nonsensical to settle such cases if Post Office had confidence in the outcome of the case at
trial, and it invites further enquiry and investigation. It is unclear how Post Office can ride
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both horses. There is a real risk it would invite critical scrutiny not only of Post Office’s
prosecution function but also of its prosecutorial decision-making during the pretrial and
trial process.
While it is difficult precisely to define how this would play out, and while I cannot
presently advise that the safety of any convictions would inevitably be put in jeopardy, I
have little doubt that the stark inconsistency of approach would be carefully scrutinised
with a view to examining if any of the trials or pleas of guilty might be reopened before
the Court of Appeal.
Compensation that is structured in such a way that a pool of money was distributed among
all the Claimants (subject to agreed criteria) which required each Claimant’s case to be
measured against those criteria to determine the amount of compensation suffers from
precisely the same problem.
Compensation of a single lump sum distributed among the Claimants implies acceptance
that convicted Claimants will share in the pot, whether or not it has Post Office’s direct
knowledge or blessing but does not avoid the problem.
Legally, the mere fact that Post Office settled the group litigation by financially
compensating any or all the convicted Claimants cannot alone lead to the conclusion that
any conviction is unsafe. Any applicant to the Court of Appeal needs to find substantive
grounds and the CCRC cannot make a reference on a whim; they too need to identify a
proper basis for doing so. But, not only will settlement fly in the face of the prosecution,
and the conviction and sentencing of those offenders, as argued above, but also, overall,
the appearance of compensating those convicted of, or those who pleaded guilty to,
criminal offending against Post Office is unfortunate, and, despite attempts to control or
cosmeticise the optics of the agreement, financial settlement sends out the wrong message:
that despite committing criminal offences against Post Office such people are entitled to
compensation on merit.
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It is naturally impossible for me in the abstract to advise on the precise risk to any
conviction in the absence of seeing and considering substantive grounds or any reference.
But even if a settlement agreement was reached on the basis of no admission of fault by
Post Office, while that might bind the convicted Claimants contractually, it will not prevent
individuals from seeking to find and attempting to pursue an appeal against conviction if
there are grounds to support it (I would think to bind them against it in any settlement
agreement would be held contrary to public policy and struck down); and at all events
nothing will operate to prevent the CCRC continuing to examine the case, and deciding to
pursue a reference to the Court of Appeal under its “exceptional circumstances”
jurisdiction if so advised.®
Foreseeing all the possibilities is impossible, but I do see another subtle yet possibly
significant risk: if the Court of Appeal was ever asked to adjudicate on the matter on behalf
of an individual or by means of a CCRC reference, there is no question in my mind that
the settlement of convicted Claimants’ cases could risk unwelcome and possibly critical
consideration by the Court of Appeal of the settlement itself (or possibly the reasons
underlying it) over and above any grounds of appeal or the substance of any CCRC
reference. The Court could not reopen the agreement, but the Court would be aware (or
made aware) of the settlement and its terms and might seek answers to some difficult
questions about it which could affect its view of any convictions it was being asked to
consider.
I have enquired whether Post Office had in mind any differential approach as between
convicted Claimants and others. I am told that if a settlement materially risked the safety
of their convictions then Post Office might seek a settlement structure that ringfences the
convicted Claimants from the others so that they receive nothing. However, I have also
been told that that could be seen as a divisive step that could fracture the Claimants’ group
between those who wish to settle and those wishing to fight on.
® Section 13 of the Criminal Appeal Act 1995
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While I understand the politics, in my view Post Office cannot avoid the fact that convicted
Claimants represent a very special category who have either pleaded guilty or been
convicted by a Court of offences of dishonesty against Post Office. Settlement with them,
before any Horizon Issue judgment, sends out a message (rightly or wrongly) that Post
Office has/had little or no faith in its civil defence against all the Claimants, including the
convicted ones; also it potentially undermines the view of Post Office’s confidence in those
Claimants’ criminal convictions (as indicated above). It is not only a potential sign of
weakness that would, I think, be a message the CCRC will seize on and scrutinise at
whatever stage any settlement offer is broached or agreed and could influence their
decision-making, but also would have a subliminal effect on the Court of Appeal if they
became seized of any appeal or reference.
In my opinion, there is some risk to including convicted Claimants in any settlement
agreement or package. At this stage, and in the abstract, Iam unable exactly to define or to
quantify the risk. While it has to be a matter for others to advise and decide how far Post
Office should go in progressing a differential approach among the convicted Claimants and
the rest, my advice must be that reaching any settlement agreement with the convicted
Claimants should be a red line for all the reasons given above.
Conclusions
In summary:
a. Any admission of wrongdoing by Post Office to convicted Claimants is to be avoided,
as is any public apology that risks misinterpretation or the implication of an admission
of fault.
b. Although settlement by financial compensation including the convicted Claimants
cannot of itself lead to the conclusion that any conviction is unsafe, I foresee a real risk
of Post Office taking an approach which could be interpreted as incongruous with the
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processes it instituted as prosecutor when seeking conviction and sentence of, and
ancillary compensation or confiscation orders against, convicted Claimants.
There is a real risk such a settlement would invite critical scrutiny not only of Post
Office’s prosecution function, but also of its prosecutorial decision-making during the
pretrial and trial process.
There is also some risk that Post Office settling or seeking to settle the case at any
stage, even prior to delivery of the Horizon Issues judgment, might be viewed as a sign
of weakness or a lack of confidence in both its civil and criminal cases by the convicted
Claimants as well as by the CCRC who may then be encouraged to investigate “the
technical aspects” of the case heard in the Horizon Issues Trial evidence and to seek
to appeal or to make a reference, which will potentially open the settlement agreement
(or the rationale underlying it) to consideration or questioning by the Court of Appeal
as part of any appeal/reference hearing.
There is therefore in my judgment some risk to the safety of convictions of including
convicted Claimants in any settlement agreement or package.
Brian Altman QC
2 Bedford Row
London WC1R 4BU
17 June 2019