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WOMBLE
BOND
DICKINSON
Bates & others v Post Office Limited
{DRAFT} Recusal Note
Introduction
Post Office is actively investigating its legal options for responding to the Common Issues trial judgment
(CIT Judgment). The orthodox response to an adverse judgment is an appeal on legal and / or
procedural grounds. It is recommend that Post Office pursues both these appeal routes.
Amore immediate and potent option is to consider whether Mr Justice Fraser's findings are so unfair as
to warrant recusing him on grounds of bias. We set out below the grounds for, and effect of, a recusal.
Advice has also been sought from the Rt Hon Lord Neuberger, who was until 2017 the President of the
Supreme Court, being the most senior Judge in the UK. His advice is summarised below.
Basis for seeking a recusal
The test for recusal is ‘whether the fair-minded and informed observer, having considered the facts,
would conclude there is a real possibility that the[Judge] was biased’.
In the words of Lord Neuberger, Post Office's concern is that 'the Judge made findings of fact [...] in such
a way as to betray a prejudice against the PO which justify the PO objecting to his continuing to hear
these proceedings."
Arecusal application is also consistent with, and lends support to, anywider appeal that Post Office may
wish to make.
Effect of recusal
If successful, the application for recusal would remove Mr Justice Fraser and he would be replaced with a
new Judge who had overall conduct of the Post Office Group Litigation.
If the application for recusal is successful it is likely (although not certain) that parts (at least) of the
findings made in the CIT Judgment would be struck down. We anticipate that the CIT Judgment would
remain binding until considered by the Court of Appeal, who should be able to make their own
determination on the issues. A further plausible outcome of the recusal application (if successful)
together with an appeal of CIT Judgment could be a full re-trial of the CIT—-Effectively, effectively starting
again before a new Judge._We consider this unlikely as what the Court should have done at the CIT is to
determine issues of law (i.e. interpretation of the contracts and determining anyterms to be implied) and
the Court of Appeal is in as good a position as the trial judge to do this.
Depending on when the recusal application is heard, it mayalso cause the ongoing Horizon Issues trial to
be suspended and / or re-tried bya new Judge.
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Prospects of success
Post Office was represented at the CIT byDavid Cavender QC who has been engaged for over a year.
Mr Cavender's view is that it is difficult to see how the litigation can be proceeded to a sensible (and fair)
conclusion before this Judge. He has behaved (and is apparentlycontinuing to behave in the current
Horizon Issues trial) ina manner which can onlyfairly be described as biased against Post Office. Itis
almost as though he is a partyand has his own position — as opposed to being a neutral tribunal
overseeing an adversarial process. That bias is reasonablyobvious in the manner that he has behaved
and the findings that he has made.
Given the seriousness of a recusal application, Post Office has sought a further opinion from an
independent lawyer, Lord Neuberger. His Lordship is well placed to advise on these matters having been
a Supreme Court Judge and, during that time, having given a number of seminal judgments on matters of
contractual interpretation that are at the heart of the CIT.
Having been briefed by Mr Cavender and read the CIT Judgment, Lord Neuberger's view is that:
"For all the reasons set out above I consider that there are reasonable grounds for PO to bring an
application to recuse the Judge in these proceedings."
In his advice, he also offered a cursoryand impressionistic view of the wider matters that could be
appealed and commented that:
“at least some of them raise quite significant points on which the PO has a reasonable case, and
at least on the face of it, some points on which the PO has a pretty strong case”
Post Office has also briefed a further senior silk, Lord Grabiner QC. Post Office has taken such a step as
Lord Grabiner can appear as an advocate for Post Office at anyappeal / recusal application whereas
Lord Neuberger, being an ex-Judge, cannot.
Advantages of a recusal application
Most critically, if the Judge is prejudiced against Post Office and remains the Judge presiding over the
proceedings then it is unlikely that Post Office will get a fair hearing on anyissue. Any small weakness in
Post Office's case will be magnified into a major problem and anypoints of dispute will be tilted against
Post Office.This-teads-t ignificantly4 kof adverse judg
The Judge has also heavily criticised several of Post. Office's witnesses in the CIT as being unreliable.
nly inter If-prese v
then drives the way its witnesses give evidence. These criticisms are, in our view, largelyunfair._ It isa
major concern that the Judge will carry across this thinking into subsequent trials and no matter who
gives evidence for Post Office they will never get a fair chance. Of particular concern is that Angela Van
Den Bogerd is a key witness for Post Office. She was heavily(and in our view, unfairly) criticised in the
CIT and is giving evidence again in the Horizon Issues trial on Monday 18 March 2019 — which puts the
presentation of our case on Horizon immediately on the back-foot.
There must be a real risk that unless this opportunityis taken to remove the Judge, he is onlygoing to get.
worse — as he gets emboldened byhis earlier findings, and Post Office will be stuck in an unfair trial
process. It can then expect adverse and draconian findings going forwardin future trials; including the
ongoing trial about Horizon and the third and fourth trials scheduled forNevemberAutumn 2019 and
March 2020.
Adverse judgments in these trials, like the CIT Judgment, could have a profound, potentiallyexistential,
impact on Post Office.
1. There may be findings that would severely constrain Post Office's ability to operate and develop
its business and / or cause Post Office to incur significant costs of operational change. For
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example, an adverse finding in relation to Horizon could make recovering losses in branches very
difficult and force Post Office into spending significant sums re-designing the system.
2. Post Office could be exposed to significant compensation claims dating back 20 years. Itis
difficult to value such claims, but they could be in the hundreds of millions of pounds. Before the
CIT Judgment radically altered the landscape, we were content that there were well-established
legal principles that would have substantiallylimited compensation claims to a lower level.
3. The brand damage for Post Office could be severe and irreparable.
4. Further adverse judgments might ultimately call into question the convictions of dozens of
Subpostmasters, potentially leading to those convictions being overturned.
Importantly, part of any appeal of the CIT Judgment would be for "procedural unfairness". The CIT
Judgment was meant to be about contractual interpretation. In law, what occurs after a contract is
formed cannot be relevant to an enquiryas to what the contract means. Yet Mr Justice Fraser makes
wide findings of fact on post-contractual matters and this seems a fundamental flaw in his judgment. If
Post Office is to forcefully assert procedural unfairness, it would be inconsistent to not applyfor recusal
too as the prejudicial findings of fact and adverse comments of the Judge are evidence (Post Office sag)
of both bias and procedural unfairness. To make one application without the other being made is
inconsistent and weakens each position.
Lord Neuberger also notes in his advice that if Post Office wishes to relyon the ground of procedural
unfairness at an appeal with the hope that the Court of Appeal might direct a different Judge to conduct
future trials, then "PO has little option but to seek to get the Judge to recuse himself at this stagé.
Aside from the above legal points, we would also note that several of Post Office's witnesses, manyof.
whom are long serving employees, were good enough to give evidence in Court for Post Office and have
now had their reputations tarnished. It is of course a matter for Post Office to determine the extent to
ich now wishes to tryto protect its staff from criticism. f
Lat a aS ES LIES
Risks of a recusal application
The principal risk is that the recusal application is unsuccessful (at first request and in the Court of
Appeal) and then Mr Justice Fraser becomes emboldened and openlyhostile to Post Office. This
increases the risk of further adverse findings.
It should however be noted that even making the recusal application mayhave the opposite effect—
may make the Judge more cautious and receptive to Post Office's arguments because he will be under
greater scrutiny: and this is likely to be the case whatever the outcome of that application. It maywell
have an immediate effect on his behaviour in the current Horizon issues trial.
If the recusal application is unsuccessful, any consequential costs incurred by the Claimants would need
to be paid by Post Office. These could be significant if the Horizon!ssus!ssues trial is delayed (we
estimate up to £2m). However, the more likely scenario is that the Horizon Issues trial is not delayed —
the Judge refuses to recuse himself and the Court of Appeal either recuse him or confirm him in place.
Also, any re-trial ordered will inevitably cause double trial costs to be incurred and if Post Office were to
lose the re-tried matters, then the adverse costs against Post Office could be sizeable. As we note
above, a re-trial of the CIT is an unlikelyoutcome and not one that is necessary. In the event that the
Judge is recused a re-trial of such parts of the Horizon Issues trial that have taken place is likely but the
wasted costs will likely be costs in the action generally.
Outside of Court, making a recusal application may reinforce the Judge's comments that Post Office is
“arrogant". We would note however that there is no guarantee that stayng quiet now will protect Post
Office's brand from repeat attacks in later judgments.
Process & timing
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An application for recusal needs to be made to Mr Justice Fraser himself. He mayhear the application or
ask another Judge to hear it- the latter is unlikely. It is highly unlikely the Judge will recuse himself on
the first application, so Post Office should not proceed with this course of action unless it is prepared to
appeal the refusal to the Court of Appeal immediately
Post Office should make the decision on recusal urgently- preferably not later than Monday with a view to
setting the wheels in motion with both the Court and the Claimants' solicitors earlyto mid-next week. The
urgency is driven by the unfortunate trial sequencing ordered bythe Judge and the fact he handed down
the CIT Judgment on the Friday before the Horizon Issues trial commenced on the Monday. A delay in
making the application could undermine its prospects of success, because it would be inconsistent to
continue with the Horizon Issues trial if Post Office believes the Judge to be acting unfairly
Moreover, future trials will be focused on factual findings rather than legal findings. Pure factual findings
are much more difficult to appeal, even if unfair and plainlywrong, and rarely overturned by the Court of
Appeal._If Post Office does not seek to recuse the Judge now, it is veryunlikely to have the opportunity
again and may not even be able to appeal later adverse factual findings on orthodox appeal grounds.
ThereafterOnce the application is made, the actual steps in any recusal process are harder to predict as it
depends how the Judge decides to deal with the matter and, indeed, how the Court of Appeal decides to
approach the issue too.
Arecusal application might however encourage the Court of Appeal to move quicker on the main appeal.
These issues are all interconnected and the Court of Appeal is unlikelyto want to leave a recusal
application hanging over the litigation for an extended period. This is not certain, as the Court of Appeal
may.choose to run the recusal and orthodox appeal separately An expedited appeal would have many
advantages, including that it would help linit the amount of operational change Post Office needs to
implement in the short term to comply with the CIT Judgement, which may be wasted cost if the judgment
is overturned on appeal.
Recommendation
Although a recusal application is difficult and comes with substantial risks, for the reasons stated above,
both Mr Cavender and Womble Bond Dickinson recommend that the application is made as soon as
possible.
WOMBLE BOND DICKINSON
{DRAEHI16 March 2019]
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