IN THE HIGH COURT OF JUSTICE Claim No: HQ05X02706
QUEEN’S BENCH D) IN
BETWEEN:
POST OFFICE LIMITED
Claimant
-and-
LEE CASTLETON
Defendant
CLAIMANT’S SKELETON
ON TRIAL TO BE HEARD
FROM MONDAY 4" DECEMBER 2006
Introduction
1, This is the skeleton argument of the Claimant (“C”) on the trial of the trial of this action
listed to start on 4" December 2006. It is not known whether and if so when D, who
appears in person, will lodge any skeleton on his behalf. A short chronology and list of
abbreviations and names is attached to this document.
Background
2. In June 2003 D was appointed as sub-postmaster of the Marine Drive Branch at 14 South
Marine Drive, Bridlington, Yorkshire (referred to as Marine Drive) under C’s
standard Post Office contract.
3. Under the terms of that contract, D was C’s agent and was responsible for the safekeeping
of its property and was obliged to account for such. He was also obliged to produce
accounts and operate the branch in accordance with standard requirements.
4. The Marine Drive Branch was located within a retail shop and operated a computerised
stock accounting system called Horizon that was connected to C’s central computer
system. All transactions on the Marine Drive Branch computer were logged onto C’s
central computer and D was obliged to check his own entries on the computer both daily
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and weekly. At the end of each business week (a Wednesday) D was obliged to prepare
and sign a document entitled “Cash Account (Final)” and send it to C.
5. D traded for several months without significant incident. However between January and
March 2004 D recorded substantial losses in the Cash Accounts (Final) signed by him and
submitted those to C. In the last Cash Account (Final) prepared and signed by him, being
for week 51,’ the week ending Wednesday 17" March 2004, D vouched an accumulated
loss of £22,963.24 in the amounts due to C.
6. On 23" March 2004 C attended at the Marine Drive Branch and an audit was carried out.
That audit revealed that by that date there was a shortage of £25,758.75 cash.”
7. Whilst the audit was being completed on 23" March 2004 the sub post office remained
closed, but the terminal for National Lottery sales in the main part of Marine Drive was
still open and sales to a value of £176 were made, whilst prizes to a value of £75.80 were
paid out,’ giving a net balance received by D or his agents of £100.20 for which he has
failed to account.
8. In the circumstances of these large unexplained shortages D was suspended by his retail
line manager, Catherine Oglesby, on 23" March 2004.
9. D requested a hearing with Catherine Oglesby in which he alleged that the shortages were
occasioned by faults with the Horizon computer system, however he was unable to
substantiate these allegations and he was subsequently dismissed.
10. He appealed that decision to John Jones and there was a hearing on 1 July 2004 at which
D again alleged that the shortages were occasioned by faults with the Horizon computer
system, however again he was unable to substantiate these allegations and his appeal was
dismissed.
' C's business runs by reference to numbered weeks, with the year ending in 2004 having week 52
ending on 24" March 2004.
? As proved in paragraph 7 of the witness statement of Helen Rose.
> Aa proved in paragraphs 12 and 13 of the Witness Statement of Michael Johnson.
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The Claim
11. C claims £25,858.95 being monies received by the Defendant (“D”) as agent for C but for
which he has failed to account. The Amended Claim appears at Bundle I tab 2.
12. D’s unparticularised defence is apparently that the losses are not real but are occasioned
by problems with C’s computerized accounting system. The Amended Defence and
Counterclaim appears at Bundle I tab 3.
13. C pleads an Amended Reply and Defence to Counterclaim which appears at Bundle 1 tab
4.
The Counterclaim
14. Since D alleges there were no “real” losses, he says his subsequent dismissal by C as a
sub-postmaster was wrongful and (by recent amendment) he claims damages of £11,250
(reduced from £250,000).
The Issues
15. There are 3 main issues:
(i) Does D owe C the amount of £25,758.75 found owing at the conclusion of the
audit;
Gi) Does D owe C the amount of £100.20, being the balance of the receipts and
payments from the National Lottery terminal at the Marine Drive Branch for
business transacted on 23 March 2004;
(iii) Did C wrongfully dismiss D, or was D in breach of contract such as to entitle C to
terminate the agreement, or did C terminate the contract lawfully in any event?
Issue (i)
16. D admits both that there was an apparent shortfall in the account of the Marine Drive Post
Office at 23 March 2004 (£25,758.75) and that the audit conducted by C’s staff
confirmed that there was a balance of £25,758.75 owing to C.* On these facts, C is
entitled to judgment in the amount of £25,758.75.
4 See paragraph 2 of his Amended Defence and Counterclaim.
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17. D does not challenge specifically any of the figures in that audit, nor does he say how any
calculation of the amount owing to C is said to be wrong or in what respect. He further
admits that he personally produced, signed off on and submitted to the Claimant the Cash
Accounts (Final),°
18. Despite this, D says (baldly) that “any apparent shortfall is entirely the product of
problems with the Horizon computer and accounting system used by [C].” He goes on to
say that “he will be able to demonstrate through a manual reconciliation of the figures
contained within the daily balance snapshot documents created by [D] during the course
of his tenure as sub-postmaster at Marine Drive Post Office”. Save to this extent, C does
not know how D intends to make his case on this point on the evidence, if he is to be
permitted to make any positive case.
19. Whilst these allegations are unparticularised, if they are to be allowed to be maintained
then the burden of proof falls on D for these reasons:
@) First, as a matter of law, “he who asserts must prove” is a well remembered
maxim;
(ii) Secondly, there is binding authority for the proposition that an agent who
produces accounts for a principal which contain statements that money has been
received is bound by those accounts unless he can show that the statements in the
accounts were made unintentionally and by mistake (see Bayley J in Shaw & Ors
—y- Picton (1825) 4 B & C 715, at 729 - 730,° alluded to in similar terms in the
speech of Lord Shaw and others in Camillo Tank Steamship Co Limited v
Alexandria Engineering Works (1921) 38 Times LR 134, at 146 — 146).
20. If (which is denied) D is able to show that the accounts should be re-opened, then C
claims an entitlement to a formal account,® for the purposes of which account the Court
might wish to consider whether to adjourn the matter to a Master of the Chancery
Division.
* See paragraph 3 of his Amended Defence and Counterclaim.
® This case is still cited as good authority in the leading texts on accounts.
” 2 authorities are cited, Shaw as a specific dicta setting out the precise ambit of the test, and Camillo
Tank in order to demonstrate the context of that dicta within the existence of the wider principle.
5 See paragraph 6 of the Amended Reply and Defence to Counterclaim.
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Issue (ii)
21. C’s claim in relation to the amount of £100.20 owed in relation to the sale of National
Lottery tickets is pleaded in paragraph 11 of the Particulars of Claim. D’s defence, set
out in paragraphs 2 and 7D, is that he does not admit the facts, that he had no way of
making the sales and he is not responsible for anything that took place on or after the day
of his suspension. It is admitted by D (in paragraph 7F) that C has demanded this sum as
part of C’s overall claim but that D has not paid it.
22. The facts that C intends to prove are that on 23™ March 2004, whilst the sub-post office
was closed whilst C’s audit was being conducted, D or his assistants made sales of £176
and disbursed prizes of £75.80 from the National Lottery terminal in the main part of his
shop, but that D never accounted to C for that balance.
23. C will rely on the evidence of Catherine Oglesby, and in particular her sketch of the
premises showing the National Lottery terminal in the main part of D’s shop, paragraph
11 of the evidence of Ruth Simpson to the effect that sales could be made when the sub-
post office was shut, and paragraphs 12 and 13 of that of Michael Johnson proving the
National Lottery records.
24. Set against a bare non-admission, C’s version will be proved on the balance of
probability.
Issue (
25. D counterclaims that his contract as a sub-postmaster was wrongfully terminated as (on
his case) the shortfalls were the product of C’s Horizon computer system.”
26. C’s case in defence is that it was entitled to terminate D’s contract on the basis of the
shortfalls, alternatively on the basis that he was in breach of clause 3 of section 22 of his
contract, in that (on D’s case) the figures produced by him were inaccurate.'°
27. Cis entitled to defeat the counterclaim on either basis.
Burden of Proof and Order of Cases
28. In these circumstances D bears the burden of proof on the majority of issues and should
make any case and lead any evidence first, with C to answer that case once it is closed.
° Amended Counterclaim paragraph 9.
'° Amended Reply and Defence to Counterclaim paragraph 11.
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29. However, since D appears in person, C proposes (subject to the Court) to open the trial so
as to ensure that Court time is used efficiently.
Authorities
30. I certify that the requirements of paragraph 8 of the Practice Direction (Citation of
Authorities) [2001] I WLR 1001 have been complied with in respect of each authority
cited.
Conclusion
31. C will invite the Court to give judgment on the claim in the full amount and to dismiss the
counterclaim.
RICHARD MORGAN
Maitland Chambers,
7 Stone Buildings,
Lincoln’s Inn,
London WC2A 3SZ
Claim No: HQ05X02706
IN THE HIGH COURT OF JUSTICE
QUEEN’S BENCH DIVISION
BETWEEN:
POST OFFICE LIMITED
Claimant
-and-
LEE CASTLETON
Defendant
CLAIMANT’S SKELETON
ON TRIAL TO BE HEARD
FROM MONDAY 4" DECEMBER
2006
Bond Pearce
Ballard House
West Hoe Road
Plymouth
PLI 3AE
Solicitors for the Claimant
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