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Post Office Limited Recs “a Wis ~
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TRANSPORT
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Legally privileged and confidential ia rivics pai ya
8 October 2013 ei a
uum Vos
REAL S Compl itive ahasliye SA
en i np ISIONS, ere
OUTCOMES Owe’ §
es
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Privilege — a reminder
Legal privilege = vital to success
Do not discuss any legal advice or anything to do with SPMR
settlements with:
e Anyone outside Post Office
¢ JFSA
¢ Second Sight
¢ Subpostmasters
« BIS/MPs
¢ Your teams unless absolutely necessary
Never use legal advice or information about SPMR settlements for any
purpose other than in relation to the Scheme.
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Settlement process
1. Objectives
2. Scheme policy
3. Settlement process
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Objectives of the Scheme
Listen to SPMRs concerns
Explain Post Office's position
Offer solutions where possible
Compensate if loss has been unfairly suffered
Ensure that all convictions are fair
Demonstrate that Post Office is being transparent
Ensure that Post Office's decisions are defensible
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Objectives of today
Begin to establish principles of settlement including:
¢ When will a remedy be offered?
« What types of remedy will be available?
* How much compensation may be paid?
Deliverable: Settlement Policy
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Settlement policy — why?
1. Many different types of case — need for consistency
2. Need to comply with criminal procedures
3. Control size of scheme / scope of settlement
4. Allow Post Office to prepare for difficult cases / decisions
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Settlement factors
Number
of
claims
Value of Risk Settlement
claims a. discount cost
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Recommended settlement process
Principles of settlement
(Post Office)
Fix pool of cases
(Applicants)
Determine value of claims
(Second Sight)
Q1 2014
Set settlement 4p
parameters
(Post Office)
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Settlement principles
1. Settlement options
2. Compensation principles
3. Settlement thresholds
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1. Settlement options
Settlement In-post SPMR I Ex-SPMR Ex-SPMR Ex-SPMR
No Convicted Convicted
Conviction I (unsafe) (safe)
Explanation of issue v v v v
Apology v v v x
Compensation vO vo v x
Costs v v v x
Commitment to change v v v x
Branch improvements vo x x x
Support criminal appeal x x v x
Support reversal of x v v x
bankruptcy
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2. Compensation principles
Possible head of loss Specific factors that may reduce
compensation for particular heads of
loss
Depends on level of loss see
losses that were not due to feauttelciaren
POL.
Merve ett etettie ef) Depends on SPMR's remuneration Loss probably capped at 3 month's
tocontracttermination. {22 ' remuneration as POL always has a right to
terminate on 3 months' notice.
Loss of retail business. Depends on value of individual Difficult to claim because POL could
business always terminate on 3 months' notice and
so loss of branch and subsequent loss of —
wider retail business was always at risk.
WS TESS eS eye ) Difficult to value in cash terms. These types of loss are generally
~ irrecoverable at law for most claims.
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2. Compensation principles
Possible head of loss Specific factors that may reduce
compensation for particular heads of
loss
OS SRST TESA Eee ir Depends on nature of legal support Typically only reasonable and
the mediation scheme. but SPMRs can exceed more than _ proportionate legal costs are recoverable.
the POL contribution level for legal
support. :
Costs / expenses in other Depends on nature of legal support Typically only reasonable and
legal proceedings. provided to SPMR. proportionate legal costs are recoverable.
Pore rile 7 geeiitiI Depends on nature of sentence-— — Wrongful convictions are usually
prosecution / conviction usually comprises a combination of compensated by the state rather than the
loss of earnings and reputation prosecutor. :
losses
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. Compensation principles
Limitation — claims over 6 years old are generally irrecoverable at law.
Should settlements be offered on old claims?
Causation — At law, SPMRs need to show that their complaints have
actually caused, or at least materially contributed to, the losses
claimed. This is more difficult for claims relating to, say, a lack of
training and support. Should Post Office insist on evidence of
causation?
Remoteness - Peculiar or excessive losses that are unforeseeable to
POL may not recoverable at law. Should POL compensate these types
of losses?
Mitigation — At law, SPMRs are obliged to take reasonable steps to
reduce their losses. Should POL be looking for evidence of mitigation
before offering a settlement?
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3. Settlement thresholds
Nature of complaint Recommended threshold of
proof before offering a remedy
Horizon inaccurately records Very clear proof of a technical POL should be slow to concede that
data / transactions. defect in Horizon. Horizon has any technical faults. To
: : do so, could open the floodgates to a
Horizon has a technical . large number of claims. It willbe
problem that caused branch : almost impossible to reverse this
losses. : position if conceded.
Horizon suffered
communication and power
failures that caused losses ina
branch.
Defective hardware in the Clear proof that a specific branch Hardware failures should be localised
branch (pin pads, terminals, had defective equipment to a particular branch so less risk of a
etc.). flood of claims by making a
concession.
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3. Settlement thresholds
Nature of complaint Recommended threshold of
proof before offering a remedy
Horizon is too complex. SPMR identifies a specific Issue should be confined to a specific
problem transaction that did not problem so allows that problem to be
Operating processes are have a clear or established discretely defined and remedied
unclear. operating practice. : without undermining all transaction
processes.
Lack of support for SPMR. SPMR shows that they have Issue is confined to the specific
sought support and that the circumstances of an SPMR so less
Helplines were unhelpful. support did not (1) solve the risk of negative consequences when
issue and/or (2) POL failed to offering a remedy.
follow its established practices.
Poor / inadequate training on General complaints about POL's POL should be slow to concede that
Horizon system standard training are not — its general training is defective as
: sufficient. SPMR needs to — defective training could impact on a
identify special circumstances large number of branches. To do so,
that made training inadequate. could open the floodgates to a large
number of claim.
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3. Settlement thresholds
Nature of complaint Recommended threshold of
proof before offering a remedy
PMR unable to investigate General complaints about a lack Issue should be confined to a specific
of visibility of historic transactions problem so allows that problem to be
are not sufficient. SPMR needs discretely defined and remedied
Slide alte ule rey eles") to show a problem with the audit without undermining all transaction
Ele(teltelcmieclirrlettelale-veelget-maaa trail of a specific product / processes.
transaction.
mele Vinee eee) fers) Clear evidence that POL failed to Any remedy in response to a claim
geerenifen Wile) ets eres: look into specific issues (not that a criminal investigation /
SPMR. general complaints) raised by the prosecution is unsound should be
SPMR or failed to follow its approved by POL's criminal legal
normal investigation processes. team. Offering any remedy may
undermine a conviction and so any
remedy in this situation needs to be
considered with great care.
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eee ANE
GG
Solichont * ae te ee
Post Office Limited Recs “a Wis ~
Witte. Bea se ms
TRANSPORT
TRUC
Legally privileged and confidential ia rivics pai ya
8 October 2013 ei a
uum Vos
REAL S Compl itive ahasliye SA
en i np ISIONS, ere
OUTCOMES Owe’ §
es
POL-0036578