POL00276984
POL00276984
From: Tom Woodhouse:
Sent: Thur 20/06/2019 10:46:34 AM (UTC)
To: Ben Foat{_ GRO
Ce: Tom Leef_
Subject: RE: FW: Post Office, WBD, PwC call — Group Litigation - Annual Report and Accounts
Hi Ben
Given the likely size of any provision PwC would expect separate disclosure in the Annual Report.
In the notes to the financial statements a column would be added to the table below.
Although the description and commentary could be quite bland, I think it would still be obvious what the provision
related to.
15. Provisions
H { Network i I { '
H I Programmes I Property I Severance I Otner I Total I
H i Em £m I Em t £m I £m I
I At 26 Merch 2018 32} 7
I Charged to investments
Transfers
Provisions released in the year
ievesiments
Provisions released in the year
trading :
I At 31 March 2019 E aa 4a 225 wi
Network
I Programmes
4 En
Property I Severance I Other I
em I emi em i
‘At 25 March 2018
Current
‘The Group has recognised provisions where a present legal or constructive obligation exists as a
result of 3 past event, where it is probable that an outflow of resources will be required to settle the
obligation and a reliable estimate of the amount can be made.
‘The Network Programmes provision relates to payments due to postmasters in relation to the major
transformation programme. Provisions are recognised when either postmasters agree to terminate
their existing contracts or sign the new format contracts under Network Transformation.
Property provisions relate to vacant and onerous leases and dilapidations. Vacant and onerous lease
provisions are recognised on leasehold properties when the unavoidable costs of meeting the
obligations of the lease agreement exceed the benefits expected to be received under it.
Severance provisions are recognised for business reorganisation where the plans are sufficiently
detailed and well advanced and where appropriate communication to those affected has been
undertaken at the balance sheet date.
Other provisions of £9 million includes £1 million for personal injury claims and £2 million which sits
within the subsidiary Post Office Management Services Limited and relates to the repayment of
commission received in the event of the cancellation of insurance policies.
Thanks
POL00276984
POL00276984
Tom
From: Watts, Alan
Sent: 19 June 2019 22:07
To: Ben Foat! GRO ilucy.h.mason!. GRO!
Rodric Williams! GRO hris Neale (UK - Assurance)
: GRO !Massey, Kirster Henderson, Tom
} Tom Lee
!andrew.parsons
it GRO I Mark Underwood1
t GRO }
Subject: RE: FW: Post Office, WBD, PwC call — Group Litigation - Annual Report and Accounts
Thanks Ben
Lucy do let me know if it would be helpful to speak in advance of any wider call
Regards
Alan
From: Ben Foat;
Sent: 19 June 2
To: lucy.h.maso!
Ce: Rodric William: GRO iChris Neale (UK - Assurance)
i GRO } Watts, Alani GRO iMassey, Kirsten GRO
Henderson, Tom } Tom Woodhouse } _ GRO i Tom Lee
H GR H GRO j andrew.parsons
~~ GRO. ~.i Mark Underwood1
I GRO
Subject: RE: FW: Post Office, WBD, PwC call — Group Litigation - Annual Report and Accounts
Hi Lucy
Im copying in HSF so you can liaise with them as they are best placed to advise on their availability.
HSF — This request relates to the Annual Report and Accounts issue which we have discuss on whether a provision
ought to be made in the 18/19 Annual Report and Account (on the basis that there is past event which has a probable
economic output).
The following section contains a broad understanding or working approach rather than the actual analysis which I
POL00276984
POL00276984
have not yet seen documented (but have asked for it to be):
WBD has outlined the legal position which is (Im paraphrasing) that it is difficult to advise on the ultimate merits of
the case and therefore whether there is likely to be an economic output in relation to the litigation given that liability
has not yet crystallised in respect of the 550 claimants and wont until after the third trial but more likely 4" trial and
in any event the claimant has not yet properly particularised their claim. That said, the executive and Board are
rapidly moving to a position where settlement is looking increasingly likely and that an offer could be put forward
after the summer period. If the executive and Board adopt that strategy, my understanding is that this shift in strategy
which may mean that a provision should be made although it is still to be determined how much should be provided
and whether there is a proper basis to make that provision. Moreover, the other challenge is just because Post Office
decides that it wants to consider a making a settlement that does not mean that the claimants would accept such a
settlement. By way of example, if the Board was of the view that it was more probable than not that it would offer a
settlement and it was likely to be £18m then its probably unlikely that there is an economic output given that the
Claimants aren’t likely to accept it. Consequently, we may need to consider a range.
As the solicitors providing the oversight and advice to the Board we would appreciate your guidance on this issue.
Could you liaise with PWC (our auditors) in relation to this matter as part of our audit process.
We will need to draft a board paper which sets out the accounting reporting requirements, factual matrix and
analysis together with the recommendation for the ARC and July Board (I have set out the proposed structure below).
I will be important to ensure that once we have reached a conclusion on whether a provision has to be made and the
disclosure statement, that we socialise that to Carla Stent (Chair of the ARC beforehand).
Tom & Tom — a query was raised as whether the provision has to be separately stated as Group Litigation or does it
get bundled up with other amounts.
It may be helpful if we all join the call once its arranged. I’ve copied in my PA,
Ben Foat
General Counsel
Post Office Li
From: lucy.h.masoni
Sent: Wednesday, June 19, 2019 1:02:41 PM
To: Ben Foat
Ce: Rodric Williams; Chris Neale (UK - Assurance)
Subject: Re: FW: Post Office, WBD, PwC call — Group Litigation
Thanks Ben, that is certainly helpful.
We would still like to have a call with HSF if you could continue to chase them to arrange something.
Given they are doing more of an oversight role from an executive / board perspective, would it make sense to
have them review your paper, once completed, given that may also be presented to the board at some point?
Might be a good idea to think about having them do this?
Thanks,
Lucy .
Lucy Mason (UK - Assurance)PwC I Senior ManagerMobile::_
ricewaterhouseCoopers LLPCentral Square, 29 Wellington Street, Leeds, LS1 4DLwww.pwe.co.uk
POL00276984
POL00276984
At PwC we work flexibly - so whilst it suits me to email now, I do not expect a response or action
outside of your own working hours.
Please note, Friday is my non-working day.
On Tue, 18 Jun 2019 at 18:36, Ben Foat
Hi Lucy
Good question.
Following the common issues judgment, the Board wanted to have further assurance regarding the conduct of the
Group Litigation matter and in particular the legal strategy. Consequently, Herbert Smith Freehills, was appointed by
the CEO to provide a quasi independent oversight role over the matter reporting to the executive and Board
subcommittee. Womble Bond Dickinson remain the solicitors on the record and who principally have carriage of the
matter and undertake the work in defending the litigation.
Hope that helps. Let me know if you need any more detail.
Kind regards
Ben
Ben Foat
General Counsel
Post Office Limited
L GRO
From: lucy.h.mason! ~ ~GRO _ '
Sent: Tuesday, June 18, 2019 3:56:13 PM
To: Ben Foat; Rodric Williams
Subject: Re: FW: Post Office, WBD, PwC call — Group Litigation
Hi Ben and Rod,
Just a quick point to clarify with you, obviously Andy from WBD was very helpful this afternoon on the call
to provide some external context to us. We have also mentioned HSD as being involved in previous
discussions. Could one of you really succinctly set out what services each party has been engaged to provide
for POL as at the moment, Chris and I are both a little unclear as to HSD's role.
Many thanks in advance,
Lucy
Lucy Ma UK - Assurance)PwC I Senior ManagerMobile: I “iEmail:
PricewaterhouseCoopers LLPCentral Square, 29 Wellington Street, Leeds, LS1 4DLwww.pwe.co.uk
At PwC we work flexibly - so whilst it suits me to email now, I do not expect a response or action
outside of your own working hours.
Please note, Friday is my non-working day.
POL00276984
POL00276984
On Tue, 18 Jun 2019 at 14:28, Ben Foat;
All
GRO. wrote:
I thought it would be helpful to have a summary of the call we have just had on the ARA — Group Litigation.
The pathway forward is to have:
1. a draft board paper which sets out:
a. The accounting requirements [Lucy has provided this before so can have the pen but equally
Tom Lee / Tom Woodhouse can provide]
b. Status of the litigation and the factual matrix [Andy and Rod]
c. Table with facts supporting provision and those against provision [Ben, Andy & Rod first pen
and then Tom Woodhouse and Tom Lee]
d. Risk appetite statement [Ben]
e, Recommendations
2. Legal note from WBD setting out the legal position [PWC to WBD]
3. Update ARA Disclosure [updated subjected to above analysis]
4. Update meeting with CEO and GC with PWC and POL Finance [isro:can you arrange the call]
5. Further working group call next week to update and confirm outstanding items including first draft
of board pape ican you arrange to call]
Feel free to add / clarify.
Kind regards
Ben
Ben Foat
General Counsel
From: Tiffany Readhead
Subject: FW: Post Office, WBD, PwC call — Group Litigation
When: 18 June 2019, 12:00 - 13:00
Location: Skype Meeting
a Original Appointment:
From: Tiffany Readhead:
Sent: 14 June 2019 10:52 .
To: Tiffany Readhead; Rodric Williams; andrew.pa nter!
lucy.h.masoni ndrew Parsons °
Subject: Post Office, WBD, PwC call — Group Litigation
When: 18 June 2019 12:00-13:00 (UTC+00:00) Dublin, Edinburgh, Lisbon, London.
Where: Skype Meeting
christopher.n.neal
POL00276984
POL00276984
Join Skype Meeting
Trouble Joining? Try Skype Web App
Join by phone
English (United Kingdom)
Find a local number
Conference ID: 9412572
Forgot your dial-in PIN? IHelp
The information in this e-ma
this e-mail and any attachments. If you are not ben.f
on, distribution, publication or copy
Policy on our website,
2 e only is authorised to access
please notify tiffany readhead! soon as posible and delete any copies. Unauthorised
This comitinication or attachments is prohibited and may be unlawful, Information about how We use personal d
use, dissemi
in our Priva
ais
Any files attached to this e-mail will have been checked by us with virus detection software before transmission. Womble Bond Dickinson (UK) LLP accepts no liability for
any loss or damage which may be caused by software viruses and you should carry out your own virus checks before opening any attachment.
Content of this email which does not relate to the official business of Womble Bond Dickinson (UK) LLP, is neither given nor endorsed by it.
This email is sent by Womble Bond Dickinson (UK) LLP which is a limited liability partnership registered in England and Wales under number 0C317661. Our registered
office is 4 More London Riverside, London, SE1 2AU, where a list of members’ names is open to inspection. We use the term partner to refer to a member of the LLP, or an
employee or consultant who is of equivalent standing. Our VAT registration number is GB123393627.
Womble Bond Dickinson (UK) LLP is a member of Womble Bond Dickinson (International) Limited, which consists of independent and autonomous law firms providing
services in the US, the UK, and elsewhere around the world, Each Womble Bond Dickinson entity is a separate legal entity and is not responsible for the acts or omissions of,
nor can bind or obligate, another Womble Bond Dickinson entity. Womble Bond Dickinson (International) Limited does not practice law, Please see
inson.com/legal notices for further details.
Womble Bond Dickinson (UK) LLP is authorised and regulated by the Solicitors Regulation Authority
2A C22 29 A RR A AR A OR RF RR A 2K RRR A NR FRR CNR A RR a aa
This email and any attachments are confidential and intended for the addressee only. If you are not the
named recipient, you must not use, disclose, reproduce, copy or distribute the contents of this
communication. If you have received this in error, please contact the sender by reply email and then delete
this email from your system. Any views or opinions expressed within this email are solely those of the
sender, unless otherwise specifically stated.
POST OFFICE LIMITED is registered in England and Wales no 2154540. Registered Office: Finsbury
Dials, 20 Finsbury Street, London EC2Y 9AQ.
2A C2229 9 2K 2 FRR A 2K 2 RR A 2 2 FRR 2 28 2 ARR 0K GRR a aa
POL00276984
POL00276984
“Post Office Limited is committed to protecting your privacy. Information about how we do this can be
found on our website at www.postoffice.co.uk/privacy”
End of message text --------------------
Get involved in our public discussion on the future of audit - we want to hear your views. Find out more here
https://www.pwe.co.uk/who-we-are/the-future-of-audit.html
This email is confidential and is intended for the addressee only. If you are not the addressee, please delete the email
and do not use it in any way.
PricewaterhouseCoopers LLP accepts no liability for any use of or reliance on this email by anyone, other than the
intended addressee to the extent agreed in the relevant contract for the matter to which this email relates (if any).
PricewaterhouseCoopers LLP is a limited liability partnership registered in England under registered number
0C303525, with its registered address at 1 Embankment Place, London, WC2N 6RH. It is authorised and regulated
by the Financial Conduct Authority for designated investment business and by the Solicitors Regulation Authority for
regulated legal activities. For security purposes and other lawful business purposes, PwC monitors outgoing and
incoming emails and may monitor other telecommunications on its email and telecommunications systems.
Visit our website http://www.pwe.com/uk <a href="http://www.pwc.com/uk">http://www.pwe.com/uk</a> and see our
privacy statement for details of why and how we use personal data and your rights (including your right to object and
to stop receiving direct marketing from us).
End of message text --------------------
Get involved in our public discussion on the future of audit - we want to hear your views. Find out more here
https://www.pwe.co.uk/who-we-are/the-future-of-audit.html
This email is confidential and is intended for the addressee only. If you are not the addressee, please delete the email
and do not use it in any way.
PricewaterhouseCoopers LLP accepts no liability for any use of or reliance on this email by anyone, other than the
intended addressee to the extent agreed in the relevant contract for the matter to which this email relates (if any).
PricewaterhouseCoopers LLP is a limited liability partnership registered in England under registered number
0C303525, with its registered address at 1 Embankment Place, London, WC2N 6RH. It is authorised and regulated by
the Financial Conduct Authority for designated investment business and by the Solicitors Regulation Authority for
regulated legal activities. For security purposes and other lawful business purposes, PwC monitors outgoing and
incoming emails and may monitor other telecommunications on its email and telecommunications systems.
Visit our website http://www.pwc.com/uk <a href="http://www.pwe.com/uk">http://www.pwc.com/uk</a> and see our
privacy statement for details of why and how we use personal data and your rights (including your right to object and to
stop receiving direct marketing from us).
Herbert Smith Freehills LLP and its subsidiaries and Herbert Smith Freehills, an Australian Partnership, are
separate member firms of the international legal practice known as Herbert Smith Freehills.
This message is confidential and may be covered by legal professional privilege. If you are not the intended
recipient you must not disclose or use the information contained in it. If you have received this email i in error
please notify us immediately by return email or by calling our main switchboard on:
delete the email.
Further information is available from www.herbertsmithfreehills.com, including our Privacy Policy which
describes how we handle personal information.
Herbert Smith Freehills LLP is a Limited Liability Partnership registered in England and Wales with registered
number OC310989. It is authorised and regulated by the Solicitors’ Regulation Authority of England and
Wales whose rules can be accessed via www.sra.org.uk/code-of-conduct.page. A list of the members and their
professional qualifications is open to inspection at the registered office, Exchange House, Primrose Street,
London EC2A 2EG. We use the word partner of Herbert Smith Freehills LLP to refer to a member of Herbert
POL00276984
POL00276984
Smith Freehills LLP, or an employee or consultant with equivalent standing and qualifications. Herbert Smith
Freehills LLP's registration number for Value Added Tax in the United Kingdom is GB 927 1996 83.