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POST OFFICE LTD BOARD SUB COMMITTEE
Initial Complaint Review and Mediation Scheme
1. Purpose
The purpose of this paper is to provide the Board with:
1.1. an update on Scheme progress; and
1.2. a proposition for the way forward to inform a discussion at the subcommittee
meeting on 12 January 2015.
2. Case progress
2.1. There are now [106 cases remaining in the Scheme and Post Office has
completed its investigation of all but two cases. In terms of case progress:
* 16 cases have been resolved prior to consideration by the Working Group.
© Of the 26 cases where the Working Group has made a recommendation on
whether a case should be mediated:
© itrecommended against mediation in two cases;
o Post Office declined to mediate two cases;
© Post Office resolved two cases prior to the actual mediation; and
© ten cases have been mediated; four have been resolved, five closed
without resolution and one is on-going.
2.1. Cases have been ‘resolved’ for a variety of reasons but generally this has
been where Post Office could arguably have done more to assist the
Applicant and Where the Applicant's expectations in terms of resolution was
reasonable and broadly consistent with our assessment of the potential risk —\
and cost of litigation. It has cost c£670k in total to settle the 232 cases which
have been resolved. There are a number of cases in the Scheme where
collection of debt was suspended pending investigation of the case through
the Scheme and the recovery of that debt is factored into mediation.
3. Overall investigation findings
3.1. To date we have found no evidence, nor has any been advanced by either an
Applicant or Second Sight, of either faults with the Horizon system or unsafe
convictions (on the latter point, every case investigated has been scrutinised
by our external criminal lawyers) and no convictions have been appealed.
‘Although there are a small number of cases where Post Office should or could _/
have done more to assist Applicants, such as by etc...etc._., in the majority of _
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\ [clear what the complaints were Le. not Horizon deficiencies
\
{Commented [MU4}: I have 23 down as now resolved }
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_-{ Commented [BC4]: Tom: please add in correct figures —Inc.
resolution of MOSS and withdrawal ofthe de nahlk ase (another
category! -s of Monday
Commented [MD2]: How?I think the Board will want to know
the wider context - what things should we have done which we
didn’t? Important for context and also for telling the story
externally. Also important when we say 22 cases resolved to be very
‘Commented [MU3]; In relation to MD's above comment, we
could include the absurd vs less absurd case studies we prepared for
the meeting with Letwin in an annex?
Commented [MDS]: Very important I think to set out, perhaps.
In an annex, the avenues which criminal case applicants could
pursue (ie. Court of Appeal) and how they might access funds to
support such appeals
‘Commented [MU6]: See above comment about casestudies inc
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cases our investigations have shown that it has been the actions of the
Applicants themselves which have caused or contributed the losses they
suffered in branch, Where Post Office has recovered the losses, it has been
entitled to do so under the terms of the contract. Also, where Post Office
terminated its contract with the sSubpostmaster this is where we were entitled
to do so under the terms of the contract for material breach. In these cases
Post Office cannot and should not accept responsibility or make substantive
compensation payments.
General progress/issues
41.
4.2.
Since last sSummer Post Office has followed the strategy, agreed with the
Board, of operating within the Working Group Terms of Reference whilst
promoting Post Office's own interests (as explicitly allowed under the Terms
of Reference). This approach has, not unexpectedly, resulted in a concerted
attempt by JFSA to apply pressure to Post Office to mediate all cases where
Second Sight so recommend. Having failed to persuade the Chair of the
Working Group that Second Sight’s recommendation in favour of mediation
should be determinate, JFSA has enlisted the support of MPs and the media
in an attempt to pressurise Post Ooffice into mediating all cases.
The General Counsel and Communications and Corporate Affairs Director
have provided regular, ad hoc updates for the Board on significant
developments over recent weeks, but in summary:
i. Following discussions and written exchanges with Post Office;
JamesOffice, James Arbuthnot MP issued a press release and open
letter to the CEO withdrawing his support (along with, purportedly, 140
other MPs) for the Scheme having lost faith in the Post Office and its
commitment to the Scheme. The primary reason was Post Office's
refusal to commit to mediate all cases where Second Sight
recommends mediation. This sparked a limited degree of media
interest which was anticipated and managed so that it did not generate
widespread coverage. A full analysis of the PR position is at Annex 4
ii, JFSA has engaged Edwin Coe LPP to explore legal options should the
mediation scheme not resolve Applicants complaints. Alan Bates
‘subsequently confirmed JFSA’s continuing commitment to the Scheme
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(Commented [MD7]: We will need to use thisinpublclines
Commented [M8]: Are there cases where, given the point
about our doing more to assist applicants, we might have chosen a
Giferent course of action rather than terminating contracts etc.?
Commented [MD9]: Need to clay this further ~ something like
“There is limited evidence of active support for the MP's actions by
that many MPs”
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despite exploring legal options describing its position as “shoping for the
best but planning for the worst”.
iii, The BBC's “The One Show’ featured the Post Office and the Scheme
for two consecutive weeks in what was a clearly co-ordinated
JFSA/James Arbuthnot inspired media campaign.
iv. James Arbuthnot secured a Westminster Hall adjournment debate,
attended by kx MPs, about the Scheme and Post Office's alleged lack of __—{Commented [BC10]: Tom, can you insert? }
‘commitment to it (and therefore resolving Applicants’ complaints). This
debate received no media coverage other than The One Show.
ie (Formatted: Inder Le 35 om, Nobles or numbering)
4.3. There were a number of elements to the media and MPs' accusations about
Post Office. However, the main thrust appears to have moved away from
Horizon itself (except for the suggestion that the fact that nothing has been
found does not mean no fault exists — based on the proposition that 150
subpostmasters cannot be wrong) to centring on allegations of ‘miscarriages
of justice’ and accusations about the subpostmaster contract, which was co [MDA]: I chink every mporeant thatthe Board
described in Parliament — without foundation — as 100000 Lica tapi eer nates
I Iinister has asked us to ‘rebuild confidence’ among MPs, that we
5. Analysis ieviate along this pat: t would be pointless given the view this
small group of MPs have aboutus, and I want the Board tobe very
5.1. Although Post Office is being accused of bad faith the evidence, set out in eer eee wl he NR pecisne er et eanarel
detail at Annex 2, suggests the opposite is true and it is in fact others {om anes }
involved in the Scheme who have acted in bad faith.
5.2. Post Office, in its role as Secretariat, has sought to administer the Scheme as
efficiently and fairly as it possibly can and, in its role as a Party in each
dispute, has at all times acted in good faith, paying particular attention to the
obligations of confidentiality which binds all parties involved in the business of
the Working Group. Despite incurring direct financial costs to date of c£5m,
and diverting other scare resources away from Post Office's strategic
priorities, it has been a frustrating exercise which has failed, in large part, to
meet the expectations of relevant stakeholders or to draw a line under this
issue in a way which might enable Post Office to move forward.
5.3. This is not the product of poor execution or lack of positive effort on the part of
Post Office, but is instead reflective of the erroneous assumption which
underpins the approach of Applicants and their supporters — that is, that Post
Office is responsible, if not through Horizon then in other ways, for the
difficulties they have experienced and/or the losses they have incurred. This
has been exacerbated by the inappropriate and unjustified raising of
expectations by Applicants’ professional advisers, JFSA and MPs over what
the Scheme can, and in their minds should, deliver in terms of significant
compensation payments and/or Post Office support in efforts to have criminal
convictions overtumed.
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5.4. Post Office has, in the process, sustained a degree of feputational damage.
—{ Commented [BC13]: Mel —could you pl check consistency with }
Even if the net volume of media interest has remained relatively low, negative pon
public perception around this issue [certainly exists].\s-pretty-firmly
entrenched Even in circumstances where Post Office might be free of its (eas [MD14}: Too strong. I donot believe publ }
obligations of confidentiality and be in a position to share more balanced ou SL AED
factual information about the Scheme and the cases in it, the lazy but media-
friendly David and Goliath characterisation of this story would likely retain
much of its appeal, particularly for the small number of journalists who have
focused a great deal of attention, and their reputations, on insisting that there
is a conspiracy at work against those in the Scheme.
5.5. Against this backdrop, it would be easy to forget that there are some very real
positives to have emerged from this exercise.
5.6. Now all the cases in the Scheme have been comprehensively re-investigated,
Post Office can be satisfied that the Horizon platform, which is critical to its
entire operation across the network, operates reliably. There is, quite simply,
no evidence whatever of a systemic flaw in the system. This is positive news
for the business.
5.7. Moreover, with the exception of a small number of cases in which Post Office
might have done more to support individual Applicants (whether by being
more timely in providing additional training, in responding to enquiries or other
interventions), the investigations paint a largely favourable picture of Post
Office's engagement with the individuals running its network.
6 Challenges
6.1. In accordance with the Board's mandate, Post Office has adopted an
approach towards the individual complaints in the Scheme in which it accepts
its shortcomings where these have been apparent but defends its interests
robustly in cases where it is clear that it is neither the cause of, nor otherwise
responsible for, the difficulties and/or losses experienced by Applicants. To do
otherwise would, of necessity, have produced yet more negative outcomes in
terms of legal risk, substantial further cost and financial exposure, as well as
promoting opportunism and eroding confidence across the network.
6.2. This approach has been hugely frustrating for JFSA whose Chairman, in the
absence of evidence of a flaw in Horizon, has sought to broaden the scope of
the Scheme, actively solicited media interest and mounted a political
campaign to bring further pressure to bear on Post Office to change tack. In
addition, JFSA has also instructed a firm of solicitors, Edwin Coe LLP, to raise
the temperature still further while ostensibly maintaining support for the
Scheme. The truth is that this apparent support is conditional on the Scheme
producing the results JFSA favours, results which the available evidence
simply does not support. The message is clear: find in our favour or face
litigation. Taken together with JFSA's longstanding lack of meaningful
participation in the business of the Working Group, these developments do
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nothing but undermine the ability of the Scheme to reach an equitable
conclusion in individual cases or as a whole.
6.3. A further challenge for Post Office in all of this is Second Sight's lack of
impartiality and professionalism in the execution performance of their work. To
date, they have determined that only 2 cases are unsuitable for mediation
where any reasonable and objective assessment of the evidence would lead
to significantly higher number. In many cases, Second Sight offer no
suggestion or judgment as to what may have happened in individual cases,
and, ignoring what evidence there is, simply recommend mediation on the
grounds that mediation might offer the parties ‘closure’.
6.4. Evidence has now emerged of Second Sight's potential distortion of their own
findings to support a recommendation that a case be mediated when their
‘own internal analysis demonstrates that the relevant Applicant is wholly
responsible for the losses they incurred. Further, this came to light in a chain
of emails between Second Sight and one of the Applicant's professional
advisers in which Second Sight seek to provide reassurance that their findings
in the case would meet with the professional adviser’s approval. This
represents an inappropriate degree of co-operation, to say the least, between
Second Sight and those with a clear stake in the Scheme.
6.5. _ Lastly, and presumably discouraged by the lack of evidence of a flaw with
Horizon, attempts by Second Sight to broaden the remit of the Scheme
continue: the most recent manifestation of this being through a lengthy list of
questions for Post Office to answer to inform a further draft of their Part Two
briefing report. This is an approach which closely reflects the wishes of
JFSA and MPs.
6.6. However, the biggest challenge is managing what are now blatant attempts by
others to hijack the Scheme. The evidence from recent events suggests that,
should the Scheme not produce a conclusion that Post Office, whether
through Horizon or otherwise, is responsible for the difficulties and losses of
Applicants and that Post Office is responsible for wrongful convictions, it will
continue to be labelled as a sham by JFSA and MPs.
6.7. _ Itis also apparent that the Scheme is being distorted from its initial function —
to examine individual complaints about Horizon and associated issues and
seek, where possible, to resolve these fairly. Although JFSA has confirmed
its commitment to the Scheme, and desire to continue participating in it, the
explicit threat of litigation now leaves Post Office in the position where JFSA
receives detailed information about Post Office and individual cases to which
it would not otherwise be entitled and later be able, potentially, to pass that
information to Edwin Coe to use in litigation. I _—-( Commented [B15]: Aitemative wording? Patrick? J
6.8. As noted in previous advice, there are no circumstances in which Post Office
‘emerges from this process in a positive light, no matter how objectively unfair
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that reality is. Itis for this reason that the Sub Committee is invited to endorse
the approach set out below.
7. Away forward
Immediate steps
3.
4.
9
NO mS
7.2.
January brings a number of important dates and activities in relation to the
Scheme. We have taken and continue to take a number of steps to mitigate
the recent activities of JFSA and the media including:
i. providing a robust response to allegations in the media including writing
to BBC lawyers where appropriate and engaging at senior levels with
programme editors;
ii. writing to individual MPs who have raised cases offering to go through
their constituent's cases, with consent;
iii. compiling a ‘dossier’ addressing the general accusations made against
Post Office in the Westminster Hall debate, specifically about
prosecutions, which the Minister can table in Parliament.
Post Office is due to respond to Second Sights questions to inform their Part
‘Two report on 6 January, to be followed by a meeting on 9 January with a
relevant Post Office staff to discuss the issues raised in more detail. Of
Second Sight’s 110 questions/requests for information, around a third are
either out of scope of the Scheme or are disproportionately wide ‘fishing’
requests with no direct reference to complaints in the Scheme.
The next face to face Working Group meeting is on 14 January.
We understand through social media that there is to be a JFSA meeting on 18
January 2015. We have no specific information about that meeting and can
only speculate about why it has been called but it is reasonable to assume
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‘Commented [MD16]: Am unclear about ths paragraph — what
are we trying to say? think the ‘man on the Clapham omnibus’
narrative remains a strong one —we listened, we investigated, we.
acted. Tre, will never satisty the applients or the conspiracy
theorists but will work more widely.
{Commented [MD17}: Have we now writen to the MPs? )
Commented [MD18]: Why just criminal cases? Should be 2
comprehensive ‘myth buster’ about the claims made in parliament?
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that it will deal with the success (or otherwise) of the recent public campaign
against Post Office and the engagement of Edwin Coe.
FALLS.
We can expect more interest from The One Show — or specifically the
journalist supplying the programme with reports on this issue — in Januar
8 Decision point
1.
2.
8.1.
8.2.
2.
3.
In the circumstances set out in this paper, it is now difficult to see how the
Scheme can continue to function on its current path.
Post Office has little option but to force the issue with members of the
Working Group. The Sub Committee is therefore invited to endorse an
approach whereby Post Office uses the next meeting of the Working Group
on 14 January 2012 as a final attempt to get the Scheme ‘back on track’ by
seeking to gain acceptance of and adherence to:
the Scheme and its processes as originally designed (by all);
the Scheme's proper scope (Horizon and associated issues only);
the need to remove the threat of litigation made plain by JFSA’s
instruction of Edwin Coe LLP (which we consider to be, at this stage,
generally an exercise to exert pressure rather than, at this stage, a real
litigation threat (see Annex 3);
the need to respect obligations of confidentiality and actively to promote
this to individual applicants; and
(crucially) the principle that evidence must drive its recommendations
and conclusions.
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8.1.
8.2.
83.
8.4.
85.
8.6.
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There is no doubt that achieving this is unlikely. There would appear to be
very little to be gained from a JFSA/MP perspective in participating in the
Scheme on these balanced terms since it will not produce the pre-determined
outcomes they seek.
That said, providing this final opportunity to address these issues sensibly is
important since it is a further demonstration of Post Office's genuine attempts
to resolve Applicants’ complaints and may offer us some further protection
against possible attempt to challenge, perhaps by way of Judicial Review, any
‘subsequent decision we may need make about the future of the Scheme. The
risk of a successful challenge of this nature has already been assessed as
being low — recent legal advice suggests that this step will likely reduce it still
further. A full analysis of the Judicial Review risk is at Annex 4.
While it is highly unlikely that JFSA and its supporters will agree to a ‘reset’,
continuing on the same trajectory as presently, in other words seeking to
muddle along as we currently are, is not a realistic option. Post Office has, to
date, been extremely accommodating in relation to Scheme. Regrettably this
approach has not produced the sort of dividend one might normally have
‘expected in terms of any sort of recognition for our efforts: instead, it could be
argued that our goodwill has to a certain extent been exploited.
An attempt to maintain the status quo will entail, inter alia:
i. the continuation of a process conducted in the public eye, with every
unpopular decision of Post Office being questioned and/or challenged in
the media and in Parliament, with obligations of confidentiality
preventing Post Office from making any sort of effective rebuttal;
ii, the completion by Second Sight, likely to coincide with the run-up to the
General Election, of their Part Two report which, judging from their
performance to date and the questions they have put to Post Office to
inform its content, is near certain to place further unsubstantiated
‘charges’ at Post Office's door and broaden, quite unjustifiably, the lines
of enquiry it will be expected to address;
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vi.
a substantial risk of increased scrutiny in Parliament, perhaps through
the Business, Innovation and Skills Select Committee, bringing with it an
inevitable and unwelcome increase in the involvement and concern of
Ministers in respect of this issue, when we need the focus on other
matters of commercial importance to Post Office;
a lengthy process given that there remain 100, cases in the Scheme; the _
process of moving cases through the Working Group, attempting to
challenge recommendations of mediation by Second Sight no matter
how absurd, and scheduling and conducting mediations is certain to
take much of 2015;
pressure to allow new cases in the Scheme, some of which are likely to
be entirely opportunistic (there is already evidence of this happening);
poor results in terms of public perception since mediation can only
resolve those complaints in which the Applicant has both a legitimate
claim and is prepared to settle on reasonable terms. This is a small
number of cases in the Scheme since most include
unrealsisteunrealistic claims for consequential loss, effectively negating
the likelihood of a resolution. Post Office will be accused of bad faith in
respect of each ‘failure’ to reach a resolution which is satisfactory from
an Applicant's point of view and/or that of JFSA and the MPs; and
no meaningful reduction in the risk that Applicants, individually or as a
group, will resort to litigation to pursue their claims against Post Office.
9. Conclusion and recommendation
9.1. In summary, Post Office the situation Post Office now faces creates the
opportunity to alter the Scheme to something more realistic and proportionate
to the issues raised in the complaints. Post Office should make it clear that it
is prepared to stand by the Scheme if, and only if, it operates as originally
intended, with other Parties displaying the same degree of fairness and
responsibility as it has shown. If those terms (which had previously been
agreed to on all sides) are no longer acceptable to JFSA, Post Office should
indicate, explicitly, that it will need to reconsider the future of the Scheme.
9.2. Contingency plans are being developed which:
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‘(Commented [BC19]: check figures with para 2 i}
Commented [MD20]: This section is allfine but we need to
hhave done more to prepare the ground i.e. have some very frank
discussions with MPs including Kevan Jones about their specific
cases~and potentially have 2 discussion ofthis kind with BBC
editors fwe go down this course of action without having prepared
the ground ike this, we risk it blowing into a wider media issue. We
need to cut off or at least restrict the JFSA’s supply of media and
parliamentary outlets
(Commented [MD21]: Previous comment applies }
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would move the governance and management of the Scheme in-house
(ending Second Sight'sS current role and dissolving the Working
Group);
might include the retention of an independent oversight function in the
interests of transparency and public confidence (though not by Second
Sight); [how?] and
provide for negotiations with individual applicants, where it is fair and
reasonable to do so, in order to try to resolve their complaints.
mediation?)
preparing our own report of the Scheme so far and our findings as a
document which could be provided to applicants (as our response to
part two was for mediation) and at the end of the Scheme be published
as a formal report of the Scheme.
9.3. The Subcommittee is invited to note the current position, agree the approach
outlined above.
9.4. Wewill update the Subcommittee towards the end of January and provide a
detailed implementation plan for bringing the Scheme in house should that be
necessary.
8.1.
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(Communications AnalysisI ‘Commented [BC22]: Mel, Ihave extracted from your paper —
would you be able to have a ook and ensure you are happy with
this?
Background/ Overview
1. The communications strategy to date has focussed on providing a measured and
proportionate response to key audiences on the central allegation of faults within the
Horizon system. There have therefore been proactive announcements on Post
Office measures to investigate and address this and about the subsequent findings of
Second Sight’s 2013 published interim report.
2. There was wide media interest and reporting of those findings but with Post Office's
response, including the establishment of the Complaints Review and Mediation
Scheme, media interest has narrowed and the story is only being closely followed
by a handful-very limited number of journalists, although significant developments are
reported slightly more broadly.
3. Since the Scheme began, there have been two short bursts of active media interest —
one from the selective leaking of the confidential P2 report produced by Second Sight
for use in mediation and, more recently, the orchestrated publicity when James
Arbuthnot announced the withdrawal of his support for the scheme and organised a
Westminster Hall debate.
4. Neither of these two events resulted in wide or sustained media coverage and the
damage, although regrettable, was contained as planned under the strategy. One
journalist has, however, adopted the story as a personal campaign (see media
analysis below).
5. Similarly, the story has failed to find any depth of traction with the majority of MPs.
Few MPs have, in reality, continued to follow the progress of their constituency cases
closely. From [144] MPs with cases in the scheme only [x] have been publicly
speaking out or in contact with Post Office at any point. [x] MPs spoke at the debate,
with none of the content yet widely reported. James Arbuthnot made clear that
‘withdrawal of support’ for the scheme was personal to him and that he did not speak
for other MPs about that. Meetings have been offered on three occasions to all MPs
with cases in the Scheme and only x have taken up this offer. [please check with
Jane Hill
6. __ Internally, the issue has been low-key and the periodic media attention has resulted
in very litle increase in enquiries from postmasters or employees through any Post
Office channels. The very few cases expressing concern about Horizon that have
been raised have been quickly addressed and have been found to be based [on user
error or misunderstanding of process]. Internal communications has been intranet-
based and/ or reactive to reflect and maintain the low level of interest. The
Communications plan manages continuing risk of leverage being provided (via the
media or elsewhere) for post masters or employees to seek to avoid their
responsibilities or the law and any attempts by some former postmasters to re-open,
‘on spurious grounds, cases not in the scheme.
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For customers there has also been extremely muted interest. Following television
coverage there is very low-level customer comment on social media and enquiries
about Horizon's integrity/ protesting about Post Office's handling of the cases are in
[single figures).
Other parties in the Scheme
8.
There is evidence of considerable collusion and orchestration of publicity between
the Justice for Subpostmasters Alliance and Second Sight (and with the office of
James Arbuthnot MP). But the JFSA, whilst clearly briefing ‘behind the scenes’, have
remained largely silent on the record and part of our communications plan is to
ensure that their position is properly drawn out publicly regarding the conflict between
their confirmation of support for the scheme yet apparent criticism of it and instruction
of solicitors.
Second Sight remain highly unlikely to go ‘on the record’ to media at this point but
there continues to be evidence of breaches of confidentiality and further ‘off the
record’ briefings to media and/ or other audiences remain highly probable. They have
continued to be positioned by other stakeholders as an independent voice.
Sir Anthony Hooper has not been commenting publicly and is unlikely to do so. He is
not predisposed to support any of the parties regarding communications, although
might continue to be prepared to provide factual information via particular routes, as
he did recently with a letter to [Postal Affairs Minister] Jo Swinson about mediation of
cases. Post Office strategy with Sir Anthony will continue to respect and be
supportive of his position as impartial Chair.
The Minister's current position regarding communications is to remain arm's length
from Post Office's management of the issue and the detail of the Scheme, but
supportive (within those constraints) in terms of ensuring high-level factual
information about the approach is provided appropriately.
The applicants themselves are largely respecting confidentiality and no applicants
have withdrawn from the scheme. There are [x] applicants from the [x] remaining in
the scheme who are providing media interviews, the vast majority of whom [pleaded
guilty to false accounting] and are seeking for their convictions to be overturned,
public apologies and, in some cases, very significant compensation. Their
messaging is changing, as expected given the findings of investigations, from
allegations about Horizon faults to wider Post Office issues — a central argument
being that they were “forced to falsely account (see media assessment below).
Media assessment
13.
Media coverage drives the internal and customer interest for this issue - this interest
remains minimal but any damaging perceptions caused by this coverage will be
addressed with definitive, proactive and carefully targeted communications at the
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relevant moment{s] of our choosing. These communications will support Post Office
taking confident and assertive action to conclude the issue and designed to draw the
strongest possible line to separate myths from reality. This will not be best achieved
by degrees and will not be without criticism or some further damage but it is vital to
demonstrate confidence and to provide clear parameters for any future questioning
‘on the issue. It can be contained to a story of very limited duration and damage
(albeit with some residual web content) if action is swift and encompasses all present
barriers to resolution.
[insert high level key findings from recent overall media! PR analysis ~ shows
modernisation’ transformation continues to dominate]
The majority of mainstream or social media is not closely following the story and their
coverage is dependent on reasonably significant new angles. One journalist has
however increasingly adopted the story as an attempted campaign via his blog and
social media, with recent films on BBC1's tabloid consumer programme, the One
Show, mostly highlighting the criminal cases. The journalist is briefed by others
closely involved in the scheme, as well as James Arbuthnot MP and some applicants
(who appeared) and also relies on third party expert opinion from those with no
detailed knowledge either of Horizon or the investigations and the scheme. There
has been obvious orchestration to try to maximise publicity. Detailed rebuttals to the
programme's senior editors has removed some of the most damaging and untrue
content - about legalities of Post Office investigations processes — and there has also
been measured legal correspondence from Post Office about both fairness of
content and the requirement to disclose any evidence if it exists. The usefulness of
‘one journalist's ‘campaigning approach’ to the issue is that it can have the effect of
down-dialling the story for other media and is more easily isolated and managed as
part of communication plan.
The withdrawal of James Arbuthnot MP's support for the scheme and the subsequent
recent Westminster Hall debate has supplied fresh content for media but it is not yet,
significantly covered outside of the One Show. However, some of the allegations
and issues raised -with no qualification or balance - by a number of MPs are likely to
be returned to in the New Year.
The communications messaging has largely centred on the fact that there is no
evidence of faults with Horizon that have caused the issues complained about. This
has been consistently landed and, because the thorough PO approach regarding
investigations into individual cases has provided increased confidence and certainty
about Horizon, the messaging has been strengthened and is now accepted/
acknowledged to a reasonable degree with most audiences. There remain a few
particular individuals within audiences who will never accept this for a range of
reasons, but they are increasingly isolated.
Communication plans address the predicted changing nature of the allegations,
which focus increasingly on the scheme itself, the criminal cases and postmaster
contracts:
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a) The complaint review and mediation scheme being a “sham”
b) _ Individuals being “forced” to commit the offence of false accounting and to
pleading guilty to it
©) Contracts being unfair and out-dated, passing all risk and responsibility for
losses to postmasters with Post Office having no incentive to investigate
d) “Remote access” - the [main issue] being used in an attempt to continue to
cast some doubt about Horizon’s integrity
19. There are other connected and currently outlying allegations, but the communications
plan manages these distractions and remains focussed on addressing the central,
now very clearly unjustified point attempted i.e. that Post Office is responsible for
some miscarriages of justice and will not admit it/ is covering it up.
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This-would, in-effect, also form the basis for-a letter to Tony/statement for the media setting
nave acted in bad faith.
{what ROL has done in-good faith and where-others-he
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Annex 2
(Good and bad faith I _- {Commented [BC23]: Placeholder for Patrick's draft J
Faith, Good and Badl.. I __-{ Commented [8C24]; Piaceholder for Patrick's draft )
1. Post Office is being accused of bad faith in its approach to the Scheme as never before,
with recent accusations by MPs, in the context of a Parliamentary Debate held on 17
December, of duplicity, malicious prosecutions and deliberate frustration of the Scheme
on its part representing a particularly low point but by no means an isolated one.
2. As noted in the Sub Committee's paper, however, these accusations are devoid of any
legitimate basis and, indeed, the facts underpin a compelling argument that the precise
opposite is true. As reminder, Post Office:
*__has spared no effort and no resource in addressing the concerns first expressed to it
in 2012 by James Arbuthnot MP;
established a Scheme, largely designed by JFSA and Second Sight;
¢ appointed the Working Group's recommendation for the Independent Chair as
suggested to it by JFSA;
«comprehensively re-investigated each and every complaint brought against it;
*_ paid, not only for the administration of the Scheme as a whole, but also for
‘ofessional advisers to assist applicants bring their complaints against POL as
effectively as possible:
* acted in accordance with the Terms of Reference: and
* fulfilled its legally binding obligations of confidentiality agreed by all Parties to the
‘Scheme, not least out of concern for the privacy of Applicants.
3.__In contrast, there is clear evidence that other participants and stakeholders in the
Scheme have paid scant regard to their obligations and/or deliberately sought to
frustrate the Scheme:
Orchestration of Campaign
¢__JFSA's instruction of Edwin Coe LLP, a ‘Today’ programme broadcast, two BBC
‘One Show’ broadcasts and the Westminster Hall Debate are clearly not the product
of coincidence. Instead, POL finds itself on the receiving end of an orchestrated
campaign designed to build a huge amount of pressure to force it to reach decisions
which meet the outcome sought by JFSA and MPs, an outcome which has been pre-
determined without regard for the available evidence. It is now near crystal-clear that
any outcome not involving a finding of fault on the part of Post Office is unacceptable
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to other parties in the Scheme: mediation offers no solution nor part solution in such
circumstances;
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Undermining of the Working Group
*_JFSA has, since [DN: please provide date], refused to play a meaningful part in the
deliberations of the Working Group. Its decision to take no part in any discussion
whatsoever about the merit of cases recommended by Second Sight as being
Suitable for mediation, while asserting its right to do so where Second Sight's
recommendation goes the other way, clearly indicates that it is acting on the basis of
a pre-determined agenda in which the only acceptable finding is one of fault on the
part of the Post Office:
* Quite aside from the self-evident lack of reasonableness of this approach, it also
places the Working Group's Chair in the invidious position of having the determining
say in almost every case and deprives him of a critical element in seeking to reach
an equitable decision. This frustrates, perhaps fatally, any sensible operation of the
‘current arrangements;
Breaches of Confidentiality
*_JFSA have also been in manifest breach of their obligations of confidentiality, having
discussed the working of the Scheme and the detail of individual cases with MPs and
in the media;
2 __Ithas also become clear that applicants and their professional advisers have shared
their case details with various media outlets. In some cases, a highly questionable
picture of the facts supporting their complaints has been painted in their applications
to the Scheme and in representations to their Members of Parliament;
2 This is also true of Second Sight, a clear example being their comment, as reported
by Andrew Bridgen MP during the Westminster Hall Debate on 17 December 2014,
that one would have to be both ‘legally and economically illiterate’ [DN: check quote]
to enter into an SPM contract with Post Office;
Exaggerated Compensation Claims
¢__ Ina majority of cases [DN: is this right 7], and presumably on the basis of the advice
they have received. licants have submitted wholly ina riate and unrealistic
claims for compensation from Post Office. Alan Bates, who leads JFSA, himself has
a claim against Post Office in the sum of £1.3m, despite having suffered no loss
during his time as a Subpostmaster,
¢__Not only are these claims in themselves almost invariably without legal or other
foundation, but they make the prospect of reaching a satisfactory resolution in the
Majority of cases extremely remote, if not impossible.
4. Those involved in the day to day of the Scheme express their reservations about
continuing on the same track in the strongest terms: we can't and won't satisfy those
who arque against us: to continue to seek to do so will represent a waste of funds and,
arguably, run against HM Treasury Guidelines on the establishment and operation of
such Schemes.
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Difficult as it may be to close the Scheme in its current guise, the alternative to so doing
may well be interpreted, with the benefit of hindsight, as prolonging a line of (public)
expenditure unnecessarily. One would expect a Select Committee to use this as one of
its points of reference.
+ Formatted: Lot }
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Annex 3
Assessment of the litigation risk posed by Edwin Coe’s involvement Commented [BC25]: Rod, you were going to do a half/one page
summary of the 8D advice
1. Edwin Coe LLP, self-styled as “the UK's leading class action firm”, states on its
website that JFSA has asked it to "pursue the rights" of Subpostmasters and that
litigation “appears inevitable”. Given this, it appears that JFSA is seeking to pursue
some form of group action against Post Office, presumably to recover compensation.
2. English courts do not have US-style class actions. In England each individual
claimant must ask the Court for a remedy, and the Court uses its case management
powers to manage multiple, similar claims in the most efficient manner.
3. The legal basis and subject matter for this type of action by Subpostmasters is not
currently clear. There are a number of issues that are sufficiently common to many
Subpostmasters that could form the basis for some form of group action, particularly
around the true meaning and effect of the standard Subpostmaster contract.
4. However, each Subpostmaster's claim is dependent on their individual dealings with
Post Office. Itis therefore difficult to envisage a scenario where a single Court
decision would automatically give rise to compensation being paid to many. After
proceedings on a number of core issues, many pieces of satellite litigation about
specific points in particular cases would be necessary before a Court would make
any compensation award.
5. The greatest bar to a group claim is likely to be cost. This type of litigation is costly
and many of the Applicants are in financial difficulties . There are third party funders
in the market who fund this type of litigation in return for a cut of the compensation
awarded. However they will only do so if the legal merits of the claim are good and
the return on their investment high. It is doubtful whether the true value of the
Applicants’ claims, once assessed against legal principles and not the artificially
inflated figures many have put forward, would be sufficient to attract a funder.
6. Edwin Coe does not, however, need to win in Court to be successful. It is possible
that their involvement is part of a strategy involving legal proceedings, media attacks
and political pressure to force Post Office to the negotiating table. Edwin Coe would
only need to find a viable but weak legal claim to go down this route.
7. However having reviewed all the Scheme cases, it is difficult to see an obviously
meritorious claim against Post Office that would have wide application to many
Subpostmasters. In 2011, Shoosmiths gathered together 100+ Subpostmasters and
attempted to run a test case challenging Horizon. Post Office defeated this claim on
procedural grounds and Shoosmiths never tried again. This suggests that a group
action is not an easy proposition and may not be viable.
8. In any event it would take time for Edwin Coe/JFSA to marshal and organise a critical
mass of Applicants into a group action. It would require a legally binding governance
structure in order to make decisions on behalf of the whole group, funding and they
should, in accordance with court rules, send a Letter of Claim to Post Office before
‘commencing Court proceedings. These steps could take 2 - 6 months...
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Annex 4
Judicial Review Advice! ‘Commented [BC26]: Placeholder for Tom Weisselberes vice
Patrick organising
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