POL00025513
POL00025513
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Treatment of Debt: Postmaster Litigation Steering Group Paper — 7 June 2016
Background and Input Sought
1. Anumber of the litigation claimants have outstanding debt due to POL from their time as a
Postmaster / Counter Clerk. Other non-claimant Postmasters are now using the Freeths
litigation to challenge POL debt recovery action.
2. The Steering Group is invited to agree a principle for the treatment of debt owed by
Postmasters as follows:
a) Claimant — Deal with through litigation:
= If time barred, plead Limitation Act defence; and
® File protective proceedings if time period is nearing expiry.
b) Non-Claimant — Deal with through BAU processes:
® This may push some more Postmasters to join the Freeths litigation (e.g. Dr
Climo); and
" New letters of claim and claim forms need to be developed to pre-empt
“Horizon” challenges.
History
3. Adecision was taken, in the early stages of the Complaint Review & Mediation Scheme (“the
Scheme”), not to pursue Applicants for their debt whilst their case in the Scheme remained
‘live’.
4. As the Scheme came towards a close’, a process by which to recover debt, varied according to
the route an Applicant’s case took, was agreed. This is set out as Annex 7.
5. However, as this process was being implemented, legal proceedings were issued against POL by
Freeths on behalf of 91 claimants, 70 of whom were Applicants to the Scheme. The FSC
considers that the potentially recoverable debts from these claimants total £680,000.
6. The Freeths litigation (and “Horizon” more generally) is also being raised by Postmasters in
response to BAU agent debt collection action.
7. Including Agents and Former Agents who are not one of the 91 named claimants, 6 categories
of debtor exist, as set in the following table.
1 The Scheme formally closed on 29 February 2016.
POL00025513
POL00025513
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Category Claimants / I Annex
Applicants I No.
Claimant’s claim against POL WAS Time Barred prior to 11 April 6 1
2016”
Claimant & Scheme
Applicant Claimant’s claim against POL WAS NOT Time Barred prior to 11 April 10 2
2016
Claimant's claim against POL WAS Time Barred prior to 11 April 6 3
2016
Claimant but non Scheme
Applicant Claimant’s claim against POL WAS NOT Time Barred prior to 11 15 4
April 2016
Non Claimant but was a Scheme Applicant 12 5
Non Claimant & non Scheme Applicant NA 6
Post Office Limited
6 June 2016
? Based on Last Day of Service.
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POL00025513
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Annex 1 - Category 1 Debtors:
Claimant & Scheme Applicant — Claimant’s claim against POL WAS Time Barred prior to 11 April
2016
8. 70 of the 91 named claimants were Applicants to the scheme.
9. Of this 70, 16 have ‘live’ debt? — one of which is Ms O’Dell. POL had until 5 May to ‘serve’ its
claim on Ms O’Dell.
10. On 4 May, it was agreed that the claim issued in relation to the debt owed to POL by Ms O'Dell
would not be ‘served’ on her. This decision was taken, principally, because the advice from
Bond Dickinson was that by doing so may, despite her claim now being ‘Time Barred, entitle Ms
O'Dell to bring a Counterclaim in the same terms as the Group Claim.
11. In effect, POL effectively took the decision that being able to argue Ms O'Dell could not form
part of the class action against it, was worth surrendering the chance of being able to pursue
the debt she owed to it - £9,600.
12. 5 of the remaining 15 claims against POL, like Ms O’Dell’s, also became time barred prior to the
11 April 2016 (when the claim against POL was issued at the High Court). These cases are set
out in the following table.
Case I Scheme Route Name LDOS Debt I Conviction Notes Possible Next steps
MO06 I Not Resolved: I Terence 29.11.07 I £11,846 I No Litigation None - Statute of
Though Walters ongoing. The time I Limitation to be used as
Mediated a defence a mechanism
limit to bring a
claim (six years
from audit) was
due to expire and I Bp to advise how, if at
a claim was all, the claim issued in
issued (via Bond 2013 alters this
Dickinson) to
preserve the
possibility of
recovering the
outstanding debt.
The claim is
for removing as a
claimant.
currently on hold.
it became clear
through
3 e.g. potentially recoverable; as according to FSC’s most recent Spread sheet shared with Mark Underwood
on Monday 9 May.
POL00025513
POL00025513
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mediation that
the Applicant
does not have any
assets
M045 I Not Resolved: I Nirmala 03.12.09 I £13,073 I No None - Statute of
Though Fatania Limitation to be used as
Mediated a defence a mechanism
for removing as a
claimant.
M046 I Not Resolved: I Siobhan 19.01.08 I £13,283 I Yes Litigation None - Statute of
Recommended I Sayer ongoing. The time I Limitation to be used as
for Deferred limit to bring a a defence a mechanism
Mediation but ee for removing as a
claim (six years
POL Refused . claimant.
from audit) was
due to expire and I Bp to advise how, if at
a claim was all, the claim issued
issued to preserve I alters this
the possibility of
recovering the
outstanding debt.
M064 I Failed to Mohammed I 28.02.08 I £55,579 I No Debtor currently I None - continue to
engage with Saleem paying £125 per receive payments.
CEDR before month Statute of Limitation to
4/09/2015 be used as a defence a
mechanism for
removing as a claimant.
M105 I NOT Katherine 19.01.07 I £10,587 I No POL issued a civil None - Statute of
RESOLVED: Mcalerney . : Limitation to be used as
Though claim which was defen mechanism
M oie d settled for £5,000 f ce cea echanis
ediate and POL was for removing as a
- claimant.
given a charge
against the
Applicant's BD to advise whether
properties charge should be
° enforced and whether,
if at all, it alters the
above
POL00025513
POL00025513
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Annex 2: Category 2 Debtors:
Claimant & Scheme Applicant — Claimant’s claim against POL WAS NOT Time Barred prior to 11 April
2016
13. 10 of the 16 claimant’s claims against POL, who were Applicants to the Scheme, were not Time
Barred prior to 11 April 2016. These are included in the following table.
Case Scheme Route Name LDos Outstanding I Conviction Notes Possible Next steps
Debt
™mo25 Cases referred I DarrenKing I 01.03.13 I £30,619 No Becomes Time Review this case following
to CEDR for Barred: the outcome of Class action?
mediation who 28.02.2019
withdrew from
the Scheme Restraint Order
dated 10 June
2013 granted to
prevent Applicant
selling his home.
Discharged 19
March 2014 —
decision taken
not to prosecute.
M028 NOT Pamela 08.06.10 I £33,519 No Becomes Time Advice sought from SG
RESOLVED: Stubbs Barred:
Though 06.06.2016 Protective proceedings
Mediated issued. POL has 4 months to
‘serve’ if it wishes to pursue
M037 Cases referred I Steve Current I £17,969 No Becomes Time Review this case following
to CEDR for Phillips Barred: the outcome of Class action?
mediation who 28.11.2020
withdrew from (Current agent - changes
the Scheme the Applicant's approach?)
branch has
converted into a
Main branch and
the agreement
included a full
and final
settlement clause
relating to claims
against POL.
MosO NEW SCHEME: I Della 24.01.12 I £17,587 Yes (WITH I WITH CCRC Review this case following
NOT Robinson CCRC) the outcome of its review by
RESOLVED. PO Becomes Time the CCRC & Class action ?
no to Barred:
mediation 22.01.2018
MoS6 NOT Kym Wyllie I 10.09.10 I £38,518 No Becomes Time Advice sought from SG
RESOLVED: Barred:
Though 08.09.2016
Mediated
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Mo60 NEW SCHEME: I Graham 28.05.10 I £45,850 Yes Becomes Time Advice sought from SG.
NOT Howard Barred:
RESOLVED. PO 26.05.2016 Protective proceedings
no to issued. POL has 4 months to
mediation the Applicant has I ‘serve’ if it wishes to pursue
signed a letter of
undertaking
promising to
repay it out of
the proceeds of a
sale of her
business
premises
M073 NEW SCHEME: I John 14.10.11 I £22,312 Yes Becomes Time Advice sought from SG
NOT Dickson Barred:
RESOLVED. PO 12.10.2017
no to
mediation
M102 Applicant Haji Abbas 19.04.13 I £73,118 No Becomes Time Review this case following
MISSING. Choudry Barred: the outcome of Class action?
Closed unless 18.04.2019
Applicant is
Found
M119 NEW SCHEME: I Marion 22.09.11 I £42,954 No Becomes Time Advice sought from SG
NOT Drydale Barred:
RESOLVED. PO 20.09.2017
no to
mediation Son sentenced to
eight months in
prison suspended
for two years
along with 200
hours of unpaid
work. POL
awarded £5k in
compensation
and £1k in costs
to be paid at
£120 per week
M141 Cases referred I Mansell 27.09.13 I £2,239 No Becomes Time Review this case following
to CEDR for Rees Barred: the outcome of Class action?
mediation who 26.09.2019
withdrew from
the Scheme Deteriorating
Health
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POL00025513
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Annex 3: Category 3 Debtors:
Claimant but non Scheme Applicant - Claimant’s claim against POL WAS Time Barred prior to 11
April 2016
14. 21 of the 91 named claimants were not Applicants to the Scheme. 6 of these claimants’ claims
against POL are now Time Barred. These are detailed in the following table
Name LDOS Outstanding I Conviction Notes Possible Next steps
Debt
Oyetu 05.09.2005 I £0 With CCRC None. Statute of Limitation to be used as a defence a
Adedayo so mechanism for removing as a claimant.
assumption
is Yes
Ghazala 01.03.2003 I TBC No Due to the time None. Statute of Limitation to be used as a defence a
Chisty period Post mechanism for removing as a claimant.
Office no longer
hold any records.
The Applicant
has however
submitted a CQR
type document
Harish Joshi I 13.05.2006 I TBC Yes None. Statute of Limitation to be used as a defence a
mechanism for removing as a claimant.
Anish Kavi 01.07.2008 I £0 TBC None. Statute of Limitation to be used as a defence a
mechanism for removing as a claimant.
Ralph Oliver I 08.08.2005 I £0 No Report produced I None. Statute of Limitation to be used as a defence a
by Kath & Shirley I mechanism for removing as a claimant.
Mohammed I 12.08.2009 I £0 TBC None. Statute of Limitation to be used as a defence a
Sabir mechanism for removing as a claimant.
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Annex 4: Category 4 Debtors:
POL00025513
POL00025513
Claimant but non Scheme Applicant - Claimant’s claim against POL WAS NOT Time Barred prior to
11 April 2016
15. 21 of the 91 named claimants were not Applicants to the Scheme. Up to 15 of these claimants’
claims against POL would not be Time Barred. These are detailed in the following table
Name
LDOS
Outstanding
Debt
Conviction
Notes
Possible Next steps
Shazia Azam
Current
£15,425
No
Advice sought from SG
Jasvinder Barang
20.04.2012
£0
Yes
None — No outstanding debt
Sharon Brown
27.11.2012
£36,645
TBC
Suspended &
then resigned to
avoid
termination
Advice sought from SG
Gary Brown
12.03.2014
£32,582
TBC
Resigned to avoid
termination
Advice sought from SG
Pauline Coyle
Current
£0
TBC
None — No outstanding debt
Frank Holt
Current
£32,372
No
Precautionary
Suspended.
The branch is
operated by the
agents daughter
who had been
increasing the
overnight cash
holdings to cover
the shortage.
Police have
investigated and
the case is sitting
with the PF office
awaiting a
decision on
whether to
prosecute.
Apparently there
is evidence of
money going into
the daughters
account.
Report semi
produced by Kath
& Shirley
Advice sought from SG
BD to advise how the current case with
the Procurator Fiscal is affected, if at all
Gillian Howard (wife of
(M060)
02.02.2016
£0
TBC
Wife of M060
None — No outstanding debt
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POL00025513
POL00025513
Karen Judd 19.03.2013 I £0 No Resigned to avoid I None — No outstanding debt
termination.
Investigation
carried out by
Kath & Shirley
Antony Khan TBC TBC TBC No record of this I Advice sought from SG
claimant can be
found
Wendy Martin Current £0 No Report produced I None —No outstanding debt
by Kath & Shirley
I anonymity order I 25.06.2010 I £0 TBC None — No outstanding debt
Shahnaz Rashid Current £35,562 No Currently ‘Advice sought from SG
suspended - case
with appeal
manager
Carol Riddell (wife of 12.10.2011 I £0 TBC Wife of M063 None — No outstanding debt
M063)
Elizabeth Stockdale Current £20,776 TBC Advice sought from SG
Greg Suszenia Current £76,941 TBC Currently Advice sought from SG
suspended
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Annex 5: Category 5 Debtors:
Non Claimant but was a Scheme Applicant
16. 80 Applicants to the Scheme are not named claimants in the Group Claim.
17. Of these 80, only 12 have ‘live’ debt. These are set out in the table below.
18. The debt owed to POL by these 12 Applicants to the Scheme should be progressed as detailed
(and previously agreed) in the process map set out in Annex 7.
Case Name Scheme Route I Outstanding I Category Notes
debt in Process
Map
‘M004 I KeithJones I NOTRESOLVED: I £24,214 2c Current Agent
Though Mediated
M020 I Margaret I Casesreferredto I £18,940 2c Settled by Consent Order. Post Office issued legal
Bateman CEDR for proceedings (via Bond Dickinson) to recover the losses
mediation who
and a settlement was reached whereby the Applicant
withdrew from
would repay £10,000 plus £8,654.38 costs. The
the Scheme , :
settlement agreement includes a clause that if the
Applicant misses a payment then Post Office could sue
for the full amount of £18k. Claim stayed by consent
order
M054 I Tracey NOT RESOLVED: I £2,975 2c Currently recovery via Security @ £1.00 a week
Merrit Though Mediated
M065 I Lynette NEW SCHEME: £10,814 2c
Hutchings I NOT RESOLVED.
PO no to
mediation
076 I Pauline NOTRESOLVED: I £7,073 1c Debtor currently paying £40.00 a month by DD
Coates Not approved by
WG for Mediation
M080 I Tracey NEW SCHEME: £8,923 2c Judgment secured. Judgment was obtained and secured
Etheridge NOT RESOLVED. through a charging order over the Applicant's property.
PO no to The wording of a charging order made against the
mediation Applicant's property states that the Judgment debt
includes:
i. £11,209.81;
ii, A further £264 of legal costs; and
iii. "Any further interest becoming due".
M109 I Grant Allen I NEW SCHEME: £18,354 2c
NOT RESOLVED.
PO no to
mediation
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Case Name Scheme Route Outstanding I Category Notes
debt in Process
Map
M110 I Rita Threlfall I Casesreferredto I £34,851 2c
CEDR for
mediation who
withdrew from
the Scheme
M115 I Jane Roberts I Applicant £2,940 2C
MISSING. Closed
unless Applicant
is Found
M121 I Kutianawala I Resolved at £124,156 2A Civil recovery proceedings were pursued in 2012 to
mediation recover the shortfall, which including interest and other
costs totalled £156,128.05 as at 18/04/2012. The
Applicant chose not to defend the civil claim and Post
Office obtained a judgment in default which was
enforced by securing a charge against the Applicant’s
marital home. No steps have as yet been taken to affect a
sale of the Applicant’s home. Repayment in exchange for
a reduction in the debt due was agreed to by the
Applicant in context of the mediation scheme but has not
been honoured.
M138 I John Moir NEW SCHEME: £25,528 2c Judgment secured. Judgment was secured following a
NOT RESOLVED. summary judgment application. The judgment dated
PO no to 20/03/2012 ordered the Applicant to pay £42,402.80
mediation . .
consisting of:
- The debt in the sum of £28,969.29;
- Interest in sum of £3,649.41;
- Plus costs of £9,784.10.
Enforcement action has previously been undertaken and
a charging order has been secured against the Applicant's
residential property. In addition enforcement through
High Court Enforcement Officers (Court Bailiffs) has
recovered £3,441.15.
M146 I Ahmed El Resolved at £27,288 2A Debtor is currently adhering to the terms of the
Kasaby mediation Settlement Agreement
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Annex ategory 6 Debtors:
Non Claimant & non Scheme Applicant
19. Pre-established BAU processes should be followed in respect of collecting monies due to Post
office by debtors that fall into this category
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Annex 7
CASE DEBT RECOVERY UNDER SPARROW
¥
4: View that there.
is no recoverable
¥
‘case is resolved
Inform Finance Service
‘Centre (FSC) that the I
Note: Current planning states that all case mediations
will be Completed by 01 February 2016 at which point
aii cases would have been categorised as set out
‘below with the exception of the one CCRC case under
2p. indications are that the CCRC wil report back on.
early 2017
this case.
bt
(112 cases) agree that debt is
4c: Closed Share Bond Diekinson I I
unresolved case tegorisation with II
(69 cases) I I: ESSEee
I FSC disagree thet debt is
Unrecoverable
Bond Dickinson T
I high level case
‘assessment
ae)
2a: Closed Inform Finance Service
resolved case ‘Centre (FSC) that the
(@ cases) case is resolved
ves
2b: Closed unresolved ORC refert0.
SeRe case I -», Delay pursultunti CORC Couto
(1 case) la pr Appeal?
2: View that debt Ce
is recoverable
(38.60
i No.
Pan cn 2c: Closed unvesolved inate steps 1 & 2 of _-Roalysi
nfm Sparro nion-CORC case ‘standars legal approach supports a>
ntorement (18 casos) to debt recovery cout claim?
> > Case closes
2d: Active case
a4
YES»