Filed on behalf of the: Defendant
Witness: Andrew Paul Parsons
Statement No.: First
Exhibits: AP 4
Date Made: 5 September 2017
Claim No: HQ16X01238 and HQ17X02637
THE POST OFFICE GROUP LITIGATION
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
ROYAL COURTS OF JUSTICE
BETWEEN:
ALAN BATES & OTHERS
AND
POST OFFICE LIMITED
Defendant
FOURTH WITNESS STATEMENT OF ANDREW PAUL
PARSONS
I, ANDREW PAUL PARSONS of Bond Dickinson LLP, Oceana House, 39 - 49
Commercial Road, Southampton S015 1GA WILL SAY as follows:
1. lam a Partner at Bond Dickinson LLP, solicitors for the Defendant, Post Office
Limited (Post Office).
2. I make this statement in advance of the first Case Management Conference in this
matter listed for 19 October 2017 (CMC). This statement is being filed alongside
the Defendant's Skeleton Argument, which was required to be lodged on 9 October
2017 pursuant to Directions Order No.1. This statement sets out factual matters
that are relied on in the Skeleton Argument and it is recommended that the Skeleton
‘Argument is read first. (Tony / Owain = this statement tries to avoid argument and
‘submission — those can go in the skeleton.
3. Facts in this statement about the operations of Post Office are taken from my own
knowledge and/or conversations and instructions from various people at Post
Office. Information about Horizon has generally been provided by Fujitsu indirectly
through Post Office personnel, Other facts in this statement are within my own
knowledge unless otherwise stated. This statement is accompanied by an exhibit
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marked Exhibit AP 3 and, except where the context indicates otherwise, page
references in this statement are to the pages of this exhibit.
‘Summary and Structure of this statement
4, This statement principally deals with the issues around relating to disclosure.—I set
ut the factual matters relevant to any decision to order early disclosure and the
nature and scope of such disclosure. I explain why, in the context of that factual
position, tFhe Claimants'disclosure orders in-their the Claimants’ proposed draft
Directions would require a massive and disproportionate effort and cost, would be
likely to produce vast numbers of irrelevant documents and would also potentially
miss important documents-thereby-requiring-disclosureto-be-repeated. I also
explain the basic outline of the disclosure that Post Office proposes.
5. These difficulties stem from the fact that in these proceedings, perhaps unusually
for_group litigation, -each Claimant's claim in-this-titigation-will-beis likely to be
factually different from any other claim to turn on the specific facts of the breaches
that he or she alleges, and that there are few common threads (see paragraphs 99
to 116 of my Second Witness Statement dated 22 December 2016 prepared for the
GLO hearing in January (Parsons 2)). Post Office agreed to a GLO in order to.
address common issues, like-principally as to the legal duties (including the ters
cofconstruction of its contracts). -KPost Office of course did not agree to a GLO so
that the Claimants might avoid having to provide a proper explanation of their
claims_and, in particular, the breaches that they allege and the losses that they
allege to have suffered. Unfortunately, this is what has thus far happened, as the
particulars of those claims so far provided (principally in the Generic Particulars of
Claim (GPOC) and the Schedules of Information (SOls)) are vague and missing
vital information. This lack of precision makes it difficult, if not impossible, for Post
Office to give the disclosure now sought by the Claimants and makes it unclearhow
this enormous amount of documents-wouldimpossible to assess to what extent the
provision of such vast amounts of disclosure would assist in the fair and efficient
resolution of any claims in these proceedings. this-Jitigation.
6. Post Office's approach to disclosure, and directions in general, is more targeted. it
looksPost Office proposes to provide early disclosure of key documents so that the
important common issues -being its-contracts-and-Horizon.-can be addressed in a
proportionate and timely manner_and to seek to make progress in this litigation
notwithstanding the absence of any clarity as to the claims that are being advanced
(particularly as to the alleged breaches of duty). -
7. tis worth emphasising that a prompt resolution to this litigation is important to my
client client for reputational and operational reasons. as-itPost Office does not want
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it-these proceedings hanging over its business any longer than necessary,
especially _as there is an obvious impact on its relationships with current
postmasters. Although-Further, although Post Office is a large company and is
confident in its legal position, it has finite resources and, unlike the Claimants, does
not have the benefit of litigation funding. + Post Office historically makes a loss
most years and relies on government support to provide critical services to local
communities. I rearet to say that The-the Claimants have dragged out every step
in the litigation process so far far, and Iammy client is concerned that their strategy
is to keep this litigation alive for as long as possible without having themselves to
engage in substantial work or to expose the detail of their claims to scrutiny, forcing
Post Office to incur very high legal costs, in-the. -hope that Post Office will cave-in
and-settle these-unmeritorious-claims.1 would refer in this regard to paragraphs [..
of Parsons 2, where I set out the summary reasons for which Post Office considers
that at least very many of the claims are manifestly hopeless.
The structure of this statement is as follows:
In Section 1 (paragraphs XX to XX)
have taken place since the Group Litigation Order Hearing on 26 January 2016
(GLO Hearing),
I describe the chronology of key events that
In Section 2 (paragraphs XX to XX)
proposed Directions.
I discuss and respond to the Claimants’
In Section 3 (paragraphs XX to XX), I set out Post Office's proposed Directions.
In Section 4 (paragraphs XX to XX), I provide some statistics on the number and
nature of the claims being advanced that I believe will be useful when considering
Directions.
SECTION 1: EVENTS SINCE THE GLO HEARING
13.
Since January 2017, my firm has exchanged extensive correspondence with the
Claimants’ Solicitors, Freeths, on a number of matters relevant to the Group
Litigation. I summarise these matters below. This does not include all exchanges
between the parties; only those that I believe are relevant to the CMC.
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PLEADINGS
‘As required by paragraph 30 of the GLO, the Claimants served their-Generio
Rartioulars-of Claim {GROG}. GPOC on 23 March 2017. The GPOC was very
different from the draft GPOC that was circulated before the GLO Hearing two
months earlier. Indeed, the filed GPOC was some 33 pages longer than the original
draft. Despite this, the GPOC did not include any pleading in relation to several of
the causes of action asserted in the Claim Form, including claims for misfeasance
in public office, conspiracy (which the Claimants agreed during the GLO hearing to
abandon) and human rights breaches. None of these causes of action has yet been
removed from the Claim Form despite their being no indication that they can or will
be pursued.
Post Office requested Further Information in respect of the GPOC on 27 April 2017
(pages XX to XX). This RFI was narrow in nature, limited to 12 requests. Freeths
had a two-week time frame in which to provide its response, namely by ++-May
response provided by the Claimants was minimal and in many instances failed to
adequately address the requests, relying on large part on an argument that the
questions related not to generic issues but to the facts of individual claims, such
that the request was premature.
On 6 July 2017, four months after Freeths served the GPOC, they provided my firm
with an amended version of the GPOC. Freeths explained that the amended
GPOC ‘simply plead[s] a term implied by the Supply of Goods are Services Act and
make[s] clear that error and detection and repellency in the Horizon system is an
issue’ (page XX). These matters had not previously been raised by Freeths in
correspondence. They were completely new allegations that,—although-seem
simple; changed the very nature of the Claimants’ case in relation to Horizon, in
that it now included an allegation that Horizon was provided by Post Office as a
service to Subpostmasters, had to be fit for purpose from a user's perspective and
was not so fit, including (but apparently not only) in that it was not sufficiently “error
repellent’. None of this has been the subject of any particularised plea.
The Amended GPOC was served just 8 working days before Post Office's Generic
Defence was due. No explanation was provided for why these amendments were
left to the last minute. Nevertheless, Post Office reacted cooperatively to the
Amended GPOC, conscious to ensure that proceedings preparations for the CMC
were not pestpenedadversely affected. As a result, Post Office consented to the
amendments on 11 July 2017 (pages XX to XX) and, in compliance with paragraph
30 of the GLO, filed and served its Generic Defence on time on 18 July 2017.
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Freeths requested Further Information in respect of the Generic Defence on 31 July
2017 (pages XX to XX). Contrasting with Post Office's focussed Request for Further
Information, the Claimants’ requests sought to question nearly all aspects of Post
Office's case. Freeths made 98 requests, spread over 61 topics, requiring a
response by 4 September 2017 and so requiring the bulk of the work to be done
‘over the summer holiday period.
My firm wrote to Freeths on 4 September 2017 to explain that the RFI response
would not be ready until the week commencing 11 September 2017 (page XX).
Post Office provided its response to the Claimants’ requests on 13 September
2017, 7 days before the Claimants’ Reply was due (pages XX to XX).
On 13 September 2017, Freeths raised for the first time that they would require an
extension of time for the service of the Reply from 20 September 2017 to 2 October
2017 (pages XX toXX). The extension sought was subsequently brought forward
to 29 September 2017. My firm asked on 13 September 2017 and 18 September
2017 that Freeths identify the specific reasons why an extension was required
(pages Xx 10 xx)
part of Post Office's RFI response that was causing them difficulty. Freeths did not
In particular, we asked them to identify whether there was any
provide this information. As explained in my firm's letters of 1 September 2017 and
20 September 2017, Post Office required sight of the Reply before it was able to
substantively respond on the Claimants' proposed directions (discussed further at
paragraph XX below - pages XX fo XX). The Claimants proposed extension to 29
September 2017 was therefore unworkable since it would only allow the parties,
with 6 working days following receipt of the Reply in which to discuss and seek to
agree directions in advance of the CMC. On 18 September 2017 and again on 20
September 2017, Post Office offered to agree to an extension to 25 September
2017 (pages XX'to XX). This would allow the parties with two weeks to discuss
directions. It was hoped that the Reply would serve to clarify and narrow various
of the factual and legal disputes apparent from the GPOC and the Generic Defence.
On 20 September 2017, Freeths made an application for an extension of time,
which was granted (with costs reserved to the CMC), and the Reply was served on
29 September 2017. This delay has seriously impacted Post Office's ability to
prepare for the CMC._and-Jit remains unclear still de-net-know-why the Claimants
could not fle the Reply on time, as no further information was provided in this reaard
in the Claimants’ application
Post Office has since, on [...] October 2017 written to the Claimants setting out its
views as to directions and lamenting in this regard that the Reply has done litte, if
anything, to clarify or narrow the issues in dispute: see [...] [Tony\//Owain do we
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23,
24,
25,
26.
27.
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Claim No: HQ16X01238 and HQ17X02637
GROUP REGISTER AND NEW CLAIM
Between [x] and [x] Freeths provided [x] Group Registers. Each of these contained
only the original Claimants. Although these Group Registers only contained the
original Claimants, each of them iteratively changed the details of those Claimants,
which has made it difficult to identify these Claimants within Post Office's records.
On 26 April 2017 and 25 May 2017, my firm wrote to Freeths asking them to provide
an update on the number of expected new Claimants (pages Xx to Xx) and an
indication of who the likely new Claimants might be. The purpose for this request
was to allow Post Office to being investigating the positions of any new Claimants.
Freeths never responded to this request but, in the meantime, the Claimants leaked
information to the media about there being over 1,000 Claimants.
On 24 July 2017, Freeths served a second Claim Form which included an additional
324 Claimants. This was the first information Post Office had on new Claimants,
which Freeths had sat on until just before the group was closed to new Claimants
(pursuant to paragraph XX of the GLO),
SCHEDULES OF INFORMATION (SOIS)
Pursuant to paragraph 26 of the GLO, Freeths served the SOls (for Claimants 1-
198) on 20 June 2017, with the exception of Claimants 86 and 122 (pages XX to
XX), for which extensions to 2 October 2017 were agreed.
Freeths were obliged to present ‘a completed Schedule of Information in the form
set out in Schedule 3 (paragraph 26 of the GLO), in order to provide the parties
and the Court with a sufficient and complete understanding of the nature and
features of the claims being brought against Post Office, including most importantly
the breaches alleged by each of the claimants. This was to enable Post Office to
make effective decisions regarding the management of claims and to assist the
Court with the overall management of these proceedings, which is highly important
given that there are now 509 Claimants (being 522 Claimants who issued a claim
less 13 who have discontinued). It was he r example, that th il provi
in the SOls would enable Post Office to identify suitable categories of claimant and
potential lead claimants and to make proposals as to pleadings and disclosure in
rel
n to lead cl
On review of the SOls provided by Freeths it became apparent that there were
serious problems with their content_and that they inadequate for the purposes
identified above. Accordingly, Post Office voiced its-consernswrote to express its
serious concerns about the SOls to Freeths in a letter dated 1 September 2017 (at
page XX). I set out below a summary of the concerns raised in my firm's letter but
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I would recommend that this letter is read in full, given its importance to the matters
to be considered at the present hearing:
28.1
28.2
28.3
28.4
28.5
28.6
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The answers given in the SOls were often inconsistent with other
answers given in the same SOI, or were inconsistent with the claims
and/or details alleged in the Amended GPOC.
imprecise and evasive language was used, making it time-consuming,
difficult and in some cases impossible to make sense of what is an
not being claimed.
In response to many questions in the SOls, no relevant details were
provided at all and, insofar as details are provided, they are provided with
such brevity that they are of lttle or no help in understanding the crucial
features of the claims asserted and, in particular, the breaches alleged
and the losses claimed.
In many cases, critical issues have been inadequately addressed or
omitted altogether, such as false accounting, deceit, concealment,
harassment, duress and/or unconscionable dealing. This was surprising
given that the Amended GPOC relies heavily on the premise that Post
Office behaved oppressively; a theme that tirelessly-runsruns through
much or even all through-all-of Freeths' correspondence with but has yet
to be-backed-up-with-any-evidence:be made the subject of any detailed
and specific allegations as to what Post Office is alleged to have done
and when and how such wronaful conduct resulted in loss to specific
Claimants.
It was intended that the SOls would provide Post Office with a fair
indication of the value of most of the Claimants’ claims and therefore a
fair idea of the total value of their claims. From the SOls provided, it is
not possible to accurately assess the claim values, because many claims
have not been valued at all, some claims have been valued in ways that
are obviously duplicative or have been inflated and others have been
valued in ways that are inconsistent with the Claimants' Amended
GPoc.
The above difficulties make it quite apparent that the SOls were prepared
with no or minimal input from Freeths. This is particularly regrettable in
circumstances where, consistently with [IDENTIFY THE SOLICITORS
DUTY TO VET CLAIMS], we had anticipated that the SOls, which were
required to be confirmed by Statements of Truth, would be the subject of
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31.
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Claim No: HQ16X01238 and HQ17X02637
meaningful advice and confirmation by the solicitors on the record, so as
to make sure that claims were not advanced without any proper basis.
In the same letter of 1 September 2017, my firm asked Freeths to correct the first
tranche of SOls and ensure that the next tranche of SOls avoided these problems
This firm also invited Freeths to provide its proposals as to how and by when this
could be done, as Post Office is mindful that this exercise will require some time
(pages XX to XX),
The remaining SOls were served on 4 September 2017 (save for a handful where
Post Office has agreed extensions of time). These suffered the same problems as
the original tranche of SOls.
Freeths wrote to my firm on 20 September 2017, in terms that I would suggest
involve effectively acknowledging that the SOls were poor quality but arguing that
more complete or accurate information was not required as it would be
disproportionate to provide this information at this stage in the litigation process
(pages XX'to XX). They-Freeths did not deny that the SOls were prepared largely
without their input. This is surprising given that those claims that have been
quantified in the SOls, although prone to a significant margin of error, add up to
around £20120 million, or approximately £240k-240,000_per Claimant-and
therefore. I do not accept that it would not have been proportionate for the solicitors
to have had a gooda degree of involvement care-and-tegalin the preparation and
checking oversight in the preparation of the SOls would-be proportionate. It came
as a genuine surprise that the SOIs were so plainly the work of non-lawyers.
SECOND SIGHT
There has been ongoing discussion between the parties regarding the Claimants
speaking to Second Sight (whose background is set out at paragraph XX of
Parsons 2), and how to protect my client's privileged information that is held by
Second Sight.
On 13 October 2016, Post Office proposed a protocol under which the Claimants
could freely speak to Second Sight, save for four protected topics where there was
a higher risk that Second Sight would be privy to Post Office's privileged
information.
For many months, the Claimants refused to accept this protocol, demanding full
and unfettered access. They could have of course accepted the protocol as a
temporary measure and, if it did not achieve their purposes, have asked later for
full access. As it was, the Claimants refused to agree anything for many months.
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35. Then, on 15 June 2017, Freeths wrote to my firm seeking to accept the protocol
with a small number of very minor tweaks. I do not know why they changed their
position or why it took them 8 months to agree to the proposal first made by Post
Office in October 2016.
36. The protocol was signed on 1 September 2017 and a copy is at pages Xx to Xx.
KNOWN ERROR LOG (KEL)
37.__On 6 July 2017, whilst writing to seek approval of the amended GPOC, Freeths
requested that Post Office urgently discloses the KEL, because it is ‘plainly of
central relevance to the case and, in particular, the issues which depend on upon
the presence or absence of bugs, errors or defects in the Horizon system’ (page
XX).
37,38. [SURELY THERE WAS A LETTER BETWEEN THIS AND THE BELOW?]
38.39._In-response, Post Office made clear at paragraph 50(4) of its Generic Defence that
the KEL is maintained by Fujitsu and is:
‘used by Fujitsu [to explain] how to deal with, or work around minor issues that can
sometimes arise in Horizon for which (often because of their trivialiy) system-wide
fixes have not been developed and implemented...it is not a record of software
coding errors or bugs...andj...to the best of Post Office's knowledge and belief,
there is no issue in the Known Error Log that could affect the accuracy of a branch's
accounts or that secure transmission and storage of transaction data’
39.40. Despite Post Office explaining the irrelevance of the KEL and that it was not within
Post Office’s control, Freeths continued to demand disclosure of the KEL on 3
August 2017 (pages XX to XX).
40.41. On 1 September 2017, Post Office explained that the KEL is, according to its
information from Fujitsu, ‘a proprietary database with approximately 4,000 entries
[and] a constantly rolling document, the current version in use has evolved over
time and may not reflect the version in place at [a] time which is relevant to the
Claimants’ claims' (pages XX to XX)
44-42._Due to the large amount of information involved and the fact that the KEL is not in
Post Office's possession or control, Post Office stated that ‘whether and, if so, how
your client should have access to the KEL therefore needs to be considered in the
context of any wider directions that are made’ (pages XX'to XX). Post Office did
not refuse access to the KEL (and was not able itself to provide such access), but
was just concerned about the timing and logistics of arranging access with Fujitsu
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42.43, Fujitsu-tell_me-that-thel_understand from Fujitsu tha the KEL cannot be easily
downloaded as it comprises data that is stored on a database, rather than being a
document in a conventional form, Even then, unless one has the necessary
database software, reading the data in the KEL is very difficult. The alternative is
to manually copy or print each entry, but this would produce poorly formatted
material and would take significant effort. Fujitsu believe that the best solution is for
someone to read the KEL on a screen at its offices where the information will be
presented in user-friendly format.
43.44. To avoid incurring needless time and costs as a result of an application, Post Office
wrote to Freeths on 22 September 2017 offering to arrange for an opportunity for
the Claimants’ IT expert to inspect the KEL at Fujitsu's premises. This offer was
conditional on the Claimants’ IT expert signing a Non-Disclosure Agreement in
order to protect Fujitsu's commercially sensitive know-how that might be revealed
in the KEL.
44.45. [UPDATE ONCE APPROACH HAS BEEN AGREED / REJECTED BY FREETHS).
DIRECTIONS
45.46._On 6 July 2017, Freeths provided a draft Directions Order for consideration. This
was sent (i) the same day as they amended the GPOC; (ii) before Post Office had
filed its Generic Defence; (ii) before all the SOls had been served (which were not
due until 6 September 2017); and (iv) before the Group Register had closed, so at
this stage Post Office was only aware that there were 198 Claimants. I do not
understand how Freeths felt able to propose directions before they had even seen
Post Office's Generic Defence or how they expected my client to be in a position to
respond. This
46.47. During July and August my firm was busy preparing Post Office's Generic Defence
and response to the Claimants’ RFI. We were also reviewing the first 198 SOls
and checking the details of the new 322 Claimants added to the Group Register.
47-48. By way of a letter dated 1 September 2017, my firm noted that Post Office would
not be in a position to comprehensively deal with directions until it had seen the
Claimant's Generic Reply, due on 20 September 2017 (but which was ultimately
not served until 29 September 2017 (at pages XX to XX)). We did however raise
a number of issues that could be dealt with without first needing sight of the Generic
Reply. This included dealing with certain heads of claim that had not been pleaded
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in the Amended GPOC, the discontinuance of claims by a number of Claimants
and the possible strike out certain categories of Claimants whose claims were
unsustainable. These points are dealt with in more detail below in Section 3
(starting at paragraph XX). As explained further in my firm's letter of 20 September
2017, the following matters could not be dealt with constructively until Post Office
had sight of the Reply:
47448.4 Preliminary issues: Post Office has pleaded two implied terms
and the Claimants’ have plead over 20. The parties also appeared to
take different views on agency duties between the parties and the
construction of express terms. Sight of the Reply was required to
understand whether any of these matters were agreed, disputed or no
longer sought to be implied and which issues should therefore be
considered as potential prel
lary issues.
47.248.2 Factual disputes: The Defence set out a factual background to
the legal and factual relationships between the parties. I expected the
Reply to accept or dispute this on a point-by-point basis and to inform
whether the parties would be able to reach an agreed statement of facts
‘on-which tothat, amongst other things, might form the factual basis for
the determination of preliminary issues.-address-preliminary issues.
47.3483 Lead cases, disclosure and expert evidence: Until the scope of
potential preliminary issues and factual matrix was known, it would not be
possible to make informed decisions on-whetherlead-cases,-disclosure
oF expert evidence-would-be-an-appropriate-as to case management
going forward (especially bearing in the mind the great difficulty in this
regard that results from the inadequacy of the SOIs).
47.448.4 Limitation and concealment: These matters were not plead in the
Amended GPOC nor covered in the SOls, but the Claimants reserved
their position on these matters to the Generic Reply. Post Office could
not therefore know at this point whether and how these matters needed
might need to be included. in-futuretaken into account in discussing
directions-unti the Claimants" position was understood.
48.49. The Reply was served on 29 September 2017. It contents have had a direct impact
‘on the Preliminary Issues proposed in Post Office's directions and the need for
further information on false accounting, settled cases and limitation issues.
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49.50. At section 2 below (paragraphs XX to XX), I discuss and respond to the Claimants’
proposed Directions. In section 3 (paragraphs XX to) XX), I set out Post Office's
proposed Directions.
SECTION 2: CLAIMANTS' PROPOSED DIRECTIONS
Background
50.51. In their draft directions, the Claimants leok-tepropose to:
50451. select Lead Cases (but do not set out what is to be done with those Lead
Cases or even how Post Office can be expected to participate in this process
without any insight into the facts alleged by individual claimants);
50.251.2 demand an-excessive-a huge amount of disclosure from Post Office_on
the premise that such disclosure is “staged” and “generi
50-351.3 secure permission for an expert witness in relation to Horizon without
setting out what issues and questions that expert would address-any-scope-of
work for that expert:
50.451.4 push off all other questions to a future CMC.
54-52._In their letter of [XX], Freeths subsequently proposed a preliminary issue on
whether the postmaster contract is a "relational" contract.
82.53. As an overall comment, I note that the Claimants’ directions ask for lots of work to
be done by Post Office but for little obvious or immediate purpose or benefit in terms
of progressing the claims. The objective of these directions or how they might help
resolve this litigation is not explained, either by the draft Order or in any related
correspondence from Freeths. My client is therefore concerned that the Claimants!
strategy is to force Post Office into providing lots of information sodocuments -and
information that-(i) so that they do not have to incur costs gathering this same
information from their own clients and (ii) they can wade through the documents in
the hope of finding something to support their speculative claims. e wear dewn Pest
Office into settling unmeritorious claims.
83.54. I deal with Lead Claimants, preliminary issues and experts when discussing Post
Office's proposed directions in Section 3 (starting at paragraph XX). However, my
client takes particular issue with the Claimants’ excessive requests for disclosure
which are addressed immediately below.
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64.55._In short, some parts of the Claimants’ disclosure orders would be extremely
‘expensive and time consuming to comply with, likely costing in excess of £XX and
taking more than 9 months to implement. This cost would fall almost entirely on
Post Office as the Claimants’ ‘draft Directions do not require much in the way of
disclosure from the Claimants, which is notable given that the Claimants have
ignored-alirefused all of Post Office's requests for documents during this litigation
and have so far not disclosed a single document in support of their claims
[CONFIRM —-NOT SURE THAT CAN BE RIGHT] Other parts of the Claimants’
disclosure orders are practically impossible to comply with, such as where they
have asked for standard disclosure on Lead Claimants without first pleading those
claims_and so providing a foundation for the application of the test for standard
disclosu
55,56._To place these points in context, I provide a detailed explanation of how Post Office
holds information at paragraphs [ref] below.
56.57. Against this background information, I then explain at paragraphs XX to XX the
difficulties in complying with the Claimants’ requests for the disclosure of generic
documents at paragraph 3 of their draft Directions (Generic Disclosure). Whilst
the Claimants have described this Generic Disclosure as being staged, it is very
close to being standard disclosure on nearly all the issues in dispute. It is also
difficult to understand how the disclosure could truly be generic in circumstances
where issues as to breach will necessarily depend on the facts alleged in individual
claims, and the GPOC pleads only ‘indicativ
breaches and reserves the
Claimants’ right to identify and rely on other breaches.
57.58._I then explain, at paragraph XX, why the Claimants’ requests for standard
disclosure on Lead Cases are unworkable.
58.59._The below comments I make should also be read against a background of several
requests for early disclosure that Freeths have already made and that Post Office
has tried, where reasonably able, to comply with. As referred to below at paragraph
[refl, Freeths began to make requests for disclosure at an early stage, including in
their Letter of Claim. Further requests for disclosure have followed, including in
relation to several branches relating to specific Claimants. Such requests included
requests for call logs, audit records, contractual documents and previous
correspondence between Post Office and the Claimant. Duetethese repeated.and
wide ranging requests, Post Office decided tehas already undertaken a wide-scale
and expensive document retention exercise to ensure that key documents would
be preserved appropriately and available for disclosure. This exercise is inevitably
not perfect nor complete due to (i) the scale of documents involved and (ii) the
imprecision of the allegations in the Amended GPOC and SOls, meaning that Post,
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Office is not in a position to know precisely which classes of documents may be
relevant and need preserving. Post Office has adopted a cautious and expansive
approach, and this has come at the cost of substantial time and effort (and ongoing
costs)
59.60. References are made below to documents that have already been forensically
extracted from Post Office with the assistance of Advanced Discovery, a specialist
e-discovery provider (Advanced Discovery), and that are being held in an online
data room (Data Room).
61. Collation of these documents has already cost Post Office £116,033.47 (plus VAT)
in fees with Advanced Discovery [IDENTIFY WHO THIS IS] alone and in excess of
£75,000 in fees with this firm. The process has produced 599,007 documents so
far and the exercise is continuing. Post Office is also incurring costs of around
£5,500 per month to host the collated documents in the-a Data data Reemroom,
the cost of which will grow as more documents are added.
60,62. _ am not aware of any similar exercise conducted by the Claimants or any of them.
Information held by Post Office
64.63._As at 1 October 2017, Post Office had 4,965 contracted employees. These people
work from around 320 different offices and locations, with 461 people of Post
Office's employees either working from home or are field-based, meaning that they
have no fixed office base. Consequently, Post Office will have potentially relevant
documents spread amongst a significant number of people and different locations.
62.64. Most of Post Office's employees will have either had contact with postmasters, and
therefore hold relevant documents, or will have been involved with support and
planning of operations that affect postmasters.
63,65. Post Office has departments that have direct contact with agents, such as the
National Business Support Centre (NBSC) helpline and Field teams, which include
Branch Support and Audit, its Security team and Contract Advisers team. However
there are also teams that develop policy and products or are responsible for
projects that will not usually have direct contact with agents but that still hold
documents that are relevant as to how Post Office operates. There are also several
back-office teams such as within the Financial Service Centre (FSC) that support
operations without typically having contact with agents themselves. Finally there
are several teams within Post Office's Corporate Services department, such as
Legal Services that will not have contact with agents but that will provide support
to operations and may get involved with issues relating to specific branches. There
are very few areas of Post Office's business that do not interact with the branch
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network at some level or are not touched on by the wide-ranging nature of the
claims.
64.66. It should also be borne in mind that the structure of these teams and people
‘engaged within them has changed since the beginning of the Claimants’ claims in
2000, as is to be expected with any business. Therefore, whilst there are 4,965 of
people employed by Post Office today, Post Office will also still have access to
some of the documents created by people who have either moved roles within the
organisation or who have now left altogether.
65.67. Further information on the roles of these teams is given during the course of this
statement.
Post Office's IT systems
66.68._In this section, I describe some of the IT systems that Post Office has in place. Post
Office outsources the majority of its IT systems, including IT support for those
systems. It is unclear at this stage which documents held by its IT providers would
be considered to be within Post Office's control for disclosure purposes. However,
any extraction of documents from these outsourced IT systems will likely cause
charges to Post Office from these IT providers.
67,69. Post Office does not have a map of all its- systems and how they connect, let alone
have manuals for it all in one place. Post Office's internal IT team estimates that it
has in excess of XX individual systems that may hold relevant documents. [toseek
from PO] To-Even to map these systems out completely would be a substantial task
ands, it is estimated, would to-take [hours] and cost [xx]. The key systems that I
am currently aware of, and which may be relevant in this litigation, are set out
below.
Horizon
68.70. Horizon is the IT system provided by Post Office and through which business is
transacted in branches.
made up of several component systems that are
developed and maintained by Fujitsu.
69.71. Transaction data is the data generated through Horizon for every customer-facing
action taken through Horizon. It is the line-by-line record of data that has been
input, which includes sales data, but could also include refunds and reversals. The
data will show the user who conducted the transaction, date, time, value and what
was carried out.
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70.72. Event data shows other actions undertaken by the Horizon user on the terminal,
such as their time of log-on and reports they have printed.
74-73. Until 2010, Horizon data was transmitted in batches to a central Post Office data
centre. Since then, it is transmitted in "real time", i.e. transactions are transmitted
as they are conducted. Controls are applied (as described in the Generic Defence
at paragraphs 53 and 54) during the flow of data from the terminal in branch to the
data centre. When transaction and event data is retrieved, a check is done to
ensure these controls are intact, meaning that the data is extremely unlikely to
contain any transmission errors.
72.74._In October 2014, Post Office instructed Fujitsu to stop deleting transaction and
event data_in accordance with its usual data archiving, retention and deletion
practices. I understand that Fujitsu currently holds transaction and event data for
all branches dating back to October 2007.
73,15._To retrieve all transaction and event data for all of the Claimants will be a
considerable undertaking because it is a labo
intensive process. As a rough
guide, Fujitsu tells me that it takes a day to retrieve 1 week of data for a branch
due, in part, due to the checks that are conducted on the data integrity controls-.
Side-stepping these controls would invalidate them, meaning that Post Office could
no longer have the same confidence in the integrity of the extracted data,
74.76. According to the Group Register served on 8 August 2017, there are around 600
branches involved in this litigation (noting that some Claimants have more than one
branch). Even to extract just one week of transaction data for each of these
branches will take 600 weeks on the basis of the procedures that Fujitsu currenly
applies [FUt6Verify]. To extract all.of the data for-all_of the branch Hoasibl
within-the lifetime of this-litigation—Fujitsu believe that it might be possible to design
a process or write a computer programme to extract the transaction and event data
without invalidating the integrity controls, but this-no such process yet exists, and I
am instructed that generating bespoke software and processes would-may cost
cost.as much as [&)
POL SAP and Core Finance
75.77._A vast amount of data that is potentially relevant to this litigation is held by the FSC.
The current structure of the FSC is that there are team leaders across the FSC who
are each responsible for nearly 150 different financial functions. These functions
include managing payments from customers by cheque or card, as well as
customers doing personal banking and ensuring those payments are accounted for
correctly, managing stocks such as postage stamps, managing payments to Post
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Office's customers taken for Camelot or other bill payment transactions (such as
utility companies) and also managing shortfalls across Post Office's branch
network.
Processes and tools used in the FSC have changed over time. Processes across
the FSC now differ widely, with some teams being primarily paper-based, some
using POL SAP and emails with some paper back-up, others using SharePoint to
varying degrees, with other tools such as Dynamics (see paragraph [refl),
Credence (see paragraph [ref]), HORice (see paragraph [refl) also in use.
POL SAP is currently the main tool used by the FSC to record financial information
across the Post Office network (including for example levels of shortfalls in
individual branches and the dates on which they accrued). It is Post office's main
cash planning and accounting tool. Total number of records in POL SAP? [awaiting
POL SAP is a database provided on licence by SAP [WHO IS THIS2). It is not
possible to simply extract all information from it for each of the Claimants as this
would produce meaningless information in database format. Specific, targeted,
reports must be run to produce information in a format that can be understood and
interpreted. Further, there are a huge amount of records across the FSC that are
held in other different places and formats, such as external systems for Amex, All
Pay and Bank Tech.
__An example of a report that can be run from POL SAP and Core Finance is one for
84.83."
transaction corrections showing each of the transaction corrections that were
issued to a branch. As described in the Generic Defence at paragraph 39, a
transaction correction is a process by which Post Office proposes corrections to a
branch's accounts.
A further report that can be run from POL SAP and Core Finance is called the
Customer Account. One of the functions of the FSC is to seek recovery of
shortfalls that have accrued in branches and which are not disputed by a
postmaster. The Customer Account shows the dates of how shortfalls accrued and
any payments or deductions from remuneration that were taken to reduce the
shortfall. [THE CLAIMANTS WILL DEFINITELY ASK FOR DISCLOSURE OF
THIS]
Towards March 2018, there are plans to fully move away from POL SAP to Core
Finance. Use of Core Finance began on 1 September 2014. Archiving for POL
SAP was set up in 2009 for any data older than 7 years. Whilst data older than 7
years is archived, it is not deleted. Post Office is putting measures into place to.
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ensure that the data from POL SAP will be preserved when it is taken offline so that
once it is understood what the Claimants seek from POL SAP, reports can then be
run.
HR SAP
82.84. HR SAP is a similar database platform to POL SAP but holds records on Post Office
‘employees (i.e. those that work in its Crown branches). It should be noted that HR
SAP does not provide a full picture of Crown employees since other records, such
as on performance, will be held locally at a branch
83.85. HR SAP also holds some information on Post Office's agents, including their
remuneration and assistants that have been registered at their branches. These
records date back to when HR SAP was introduced in 2000.
84.86. HR SAP is due to be replaced in February 2018. Currently, all data remains
available within HR SAP since it was introduced. Post Office is putting measures
in place to ensure this data will be preserved.
HORice
85.87. HORice is a tool developed by Post Office's Security team that is used in
investigations, typically into suspected fraud or criminal activity, across the Post
Office business to help understand how issues with transactions have arisen. It
provides real-time data of inputs that were made by the Assistant or postmaster at
the counter. It was first introduced around September 2014.
86.88._HORice only provides access to the previous 6 months’ of data. However, the data
contained within it is the same as the transaction and event data available to Post
Office through Horizon, it is simply presented differently to assist Post Office
Consequently, no action has been taken to produce and preserve data from
HORice.
87.89. There is a set selection of around 65 reports that can be run from HORice. Not all
of the reports give data for 6 months, some reports can only yield data for 2 months
due to the amount of information that is returned and some reports only return data
for the previous 5 days. Some of the reports can take up to 15 minutes to run and
it is not possible for one person to run more than one HORice report at a time. On
information currently available to Post Office, there are approximately 154 branches
involved in this litigation where the Claimant is either still involved with that branch
or their involvement has terminated within the last 6 months. Whilst data within
HORce will no longer be available for many of the Claimants, it could still take over
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2,500 man hours for Post Office to run the full suite of reports for each of the 154
branches where data is available.
Counter logs
88.90. In addition to the reports generated through HORice, which show the actions
undertaken by the postmaster or Assistant, there are also logs of interactions
between peripherals (e.g. PIN pads) and Horizon. Whilst the HORice report will
show the postmaster pressing print, for example, the counter log will show Horizon
communicating with the printer to actually print a document. These logs are stored
directly on the Horizon terminal. These logs are overwritten over 30 days.
89.91. On 28 September 2017, my firm proposed a process to preserve relevant counter
logs (at page XX) whereby if a Claimant believes they have experienced a technical
issue with Horizon, and if the NBSC and HSD (see paragraph [ref]) have been
unable to resolve the issue to the satisfaction of the Claimant, they may (upon
providing relevant details) request the counter log from Fujitsu
Dynamics and Remedy
90.92. Dynamics and Remedy are the different call logging systems used by the NBSC.
Between 2000 and 2014, the NBSC used software called Remedy to log calls from
‘Agent branches. This system was replaced with Dynamics. The Remedy software
is no longer in use and in 2014 when changeover occurred, the majority of call logs
from Remedy were loaded into an Access database.
94.93. The logs describe briefly the nature of the question and the answer given. Further
information about the call logs can be found below at para [ref].
92.94._In order to preserve these call logs, logs for Claimants issued in 2016 have already
been extracted and are being held in the Data-data Reomroom.
Credence
93.95. Credence is a management information tool that provides, for example, the value,
dates and times of transactions. It only holds data for the previous [18? check]
months.-and iif older transaction data is needed. prior to-this-out-off transaction
ata, it must be requested from Fujitsu. [when was Credence introduced?)
94.96. There is no need to preserve data from Credence since it mirrors the information in
the transaction data held by Fujitsu in Horizon, rather than providing any
independent record of such data
Other databases
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95.97. Post Office also has access to other databases from across its business that help
provide information on its agents. For example, the Network and Strategic Analysis
team have access to the Network Reinvention Database that provides dates of
service of its agents. Snapshots of this database have been taken at various dates
since 2016 to preserve the database at that time.
SharePoint
96.98._SharePoint is a web-based Microsoft platform that allows teams across Post Office
to save documents to it so that they can be shared. Post Office has xx SharePoint
sites [Seeking confirmation of whether PO can provide numbers of these], with
many teams having created several sites to hold documents. Examples of teams
that use SharePoint are the Contract Adviser and Field teams.
97.99. The Contract Adviser team is responsible for managing contractual actions related
to postmasters during the lifecycle of their contract. A Contract Adviser will be
involved in recruitment of postmasters, they will manage any contractual variations
such as requests to change opening hours as well as managing processes such as
suspensions or contractual terminations. Since around 2012, the Contract Adviser
team has been storing electronic documents on a SharePoint site, which is divided
into sub-sites. The Contract Adviser team SharePoint site is around 131 GB in size
and it is estimated to contain in excess of 140,000 documents. This is just one
SharePoint site, and there are dozens / hundreds more across the-rest-of Post
Office's operations and teams.
98.100.Post Office engaged Advanced Discovery to help forensically extract and preserve
potentially relevant documents from SharePoint, including from the Field and
Contract Adviser teams’ sites.
99.101.Due to the size of the Contracts Adviser site, it was not feasible to collect and
preserve data from the whole site. Following scoping, data was collected from parts
of the team’s site that were considered most likely to be relevant to this issues that
may arise in this titigation.—
490.102, This process was a significant project for Post Office, with input required
from ComputaCenter (Post Office's IT supplier that manages access to
SharePoint), as well as intemal input from Post Office's data and information
security teams, IT team and owners of the SharePoint sites. It is estimated that it
will have taken around [hours] in man hours for Post Office.
404-103. The entire process of identifying sub-sites where key relevant documents
were found, arranging access for Advanced Discovery and collections of the data
took over 4 months. [IS THIS A MEANINGFUL NUMBER? WAS ANYONE
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WORKING ON THIS FLAT OUT?] Once a working solution to extract the data was
determined, it took over a week to simply download the data, with the extraction
tools running around the clock.
402
Lotus Notes
403.104. Prior to the introduction of SharePoint in around 2012, the Contract Adviser
teams used e-filing cabinets within Lotus Notes (E-Filing Cabinets) (an email
software similar to Outlook) from around 2004. Documents such as
correspondence with agents and some contractual documents were saved here.
Other teams, such as Audit, also uploaded documents here that were relevant to
the Contact Adviser team.
404.105. The E-Filing Cabinets were on a server hosted by Royal Mail. Following
Post Office's separation from Royal Mail on 1 April 2012, access to various data
across Post Office was lost, including access to the E-Filing Cabinets.
405.106. On 28 June 2017, Royal Mail provided Post Office with a copy of the E-
Filing Cabinets. However, this copy is not complete, with for example some
attachments to emails and files embedded in other documents having been lost.
Whilst Royal Mail did not charge Post Office for this work, Post Office incurred costs
of £5,000 from Computacenter for this processing of data. The contents of the E-
Filing Cabinets obtained so far have been loaded into the Data Room.
Outlook Exchange Servers
406.107. Outlook is Post Office's principal email software used by all employees.
Retention of emails will be dependent on the individual having saved them either
within Outlook or to some other storage, such as SharePoint. Retrieval of emails
that have been saved within Outlook is possible but, as stated above, there are
4,965 employees who work for Post Office, many of whom will have relevant emails.
‘Advanced Discovery advise me that in their experience, an average user can be
expected to send and receive 31,000 potentially material emails a year. If it is
assumed that there are at least 100 key staff at Post Office whose email accounts
need collecting (which may be a conservative assumption), this would mean
capturing around 3,100,000 documents for one year alone. The GLO covers more
than 17 years. To collect all of these emails and review them for privilege and
relevance-(even at a high level and without the benefit of is specific allegations of
breach) would be a mammoth task. which I estimate would cost [£]. A particular
difficulty here is that the absence of specificity in the Claimants’ allegations would
make it very difficult (and even perhaps impossible) to devise a reliable system for
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narrowing down the review by using search terms, date ranges and the other
methods ordinarily used to reduce the pool of documents to those that require
human review.
One Drive
407108. One Drive is a cloud-based platform provided by Microsoft for individuals
to back up their files that was introduced in early 2016. It relies on individuals
saving documents to it. There is currently no deletion policy against One Drive.
However, it should be understood that One Drive is in operational use and relevant
documents will be being created and amended in respect of Claimants who still
have a relationship with Post Office. To protect against any relevant documents
being deleted from One Drive as far as is reasonably possible, litigation hold notices.
have been circulated throughout Post Office. Post Office informed me that
OneDrive currently holds XX GB of data, which Advanced Discovery would
estimate equates to [XXX] documents.
408-109. Similarly to Outlook, to collect all of the documents from across all of the
One Drives across Post Office and then review them for relevance and privilege
would cost [£].
Network drives
409.110. ‘Some teams, such as Legal, do not use SharePoint, but use shared drives
on the network. An investigation is currently ongoing by the Criminal Cases Review
Commission (CCRC) into some of the prosecutions brought by Post Office. Some
of the cases being looked at by the CCRC include cases of the Claimants. In July
2015, data was collected from the drives of the Security and Legal teams for the
purposes of the CCRC's review. The data was loaded to a data room by Advanced
Discovery on 3 September 2015 (CCRC Data Room). There are currently around
201,187 documents in this data room. Due to the source of this information much
of it will be privileged and would need review before it could be disclosed.
Huddle
440.114 Huddle is a project management and document storage platform that was
used throughout the Complaint Review and Mediation Scheme (Scheme). The
Scheme is described in more detail at paragraph 25 of Parsons 2.
444.112. Much of the documentation on Huddle has been duplicated onto
SharePoint, but some remains on Huddle. Post Office intends 1o-take-steps-towill
preserve the documentation contained on Huddle and SharePoint in respect of the
Scheme. There are currently XXX documents on Huddle [needed from Kath).
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Archived data
442.113. The Claimants’ claims span 17 years. Whilst-Tthe systems outlined in this
section represent the current and more recent IT usage, and there-will- have been
other systems and databases that have been taken offline. Depending on the
nature of specific allegation raised by Claimants, it may be necessary to access
back-up tapes of data to reconstruct the state of databases at a certain date. Some
teams also hold data on archive hard drives and memory sticks. Post Office will
may need to collect all of these in and review them, depending on the scope of
disclosure that is ordered and the status of the Claims at that time (including the
level of specificity in the allegations of breach).
Hard copy documents
443.114. Processes for data storage vary widely across Post Office, with some
teams working in specialist databases, such as POL SAP, some sharing
documents across their team in SharePoint and some storing documents
themselves on their One Drive. However, there are several teams that are still
paper-based, or regularly use paper records.
Former Agent Debt Team, FSC
444.115, The Former Agent Debt team in FSC is an example of a team that is
primarily paper-based. As set out at paragraph [ref], one of the functions of the
FSC is to manage shortfalls that arise in branches. The Former Agent Debt team
manages shortfalls that have accrued in postmasters' accounts who no longer have
a relationship with Post Office or have been suspended. The Former Agent Debt
team will seek repayment of these shortfalls from former postmasters and may
enter into correspondence with them regarding how the shortfalls arose and why
Post Office seeks repayment. The team may seek recovery through litigation if the
shortfalls remain unpaid without justification.
445.146. Although current balances for shortfalls are kept on POL SAP or Core
Finance in the Customer Account, the rest of the team's records are paper based.
These files are organised by an account reference that ties to POL SAP. Accounts
are held in the name of the agent, but each agent could have more than one
account if, for example, their contractual basis changed or they had more than one
branch.
446.117. A request was made to the Former Agent Debt Team for files that related
to the Claimants issued in 2016 and for a limited number of the prospective
Claimants in March 2017 that had been referred to in correspondence with Freeths.
For the Former Agent Debt Team to check its filing and archiving facilities for these
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files took 3 months. Over the course of May and June 2017, around 113 hard copy
files were sent from the Former Agent Debt Team to Advanced Discovery. To scan
and load these documents into the Data Room cost in excess of £10,000 in fees
with Advanced Discovery.
447.118. It is anticipated that to check for files in the Former Agent Debt team for
the newly issued Claimants and instruct Advanced Discovery to scan and load
these files into the data room will take at least as long and cost as much as it did
earlier this year.
Contract Adviser Team
448.119. The Contract Adviser team keeps both electronic records (see above
paras [ref]) and also maintains hard copy files. The hard copy files are not
duplicates of the electronic files. Current postmaster files are kept at Post Office's
Chesterfield office. The files are organised by branch so that each file will contain
information relevant to several-all those agents and temporary agents who have
operated a branch. They will therefore need a manual review to extract information
relevant-tothat pertains to the Claimants.
449.120. Former postmaster files are stored off-site. Due to the costs of maintaining
this storage, if a Postmaster's file has been closed and archived for a period of
more than 6 years, the file may be securely destroyed. This process is now on
hold, however this would not have prevented historic files from being securely
destroyed prior to the commencement of this litigation. [IS THAT THE CUT OFF
POINT? SURELY A HOLD NOTICE WAS GIVEN BEFORE THE CLAIM FORM
WAS SERVED.
Security
420.121 The Security team at Post Office may investigate where any criminality is
suspected at a branch, for example theft of Post Office's assets by either a
postmaster or a branch Assistant. -
424.122. Whilst the Security team maintains electronic files, it also keeps hard copy
files at Chesterfield, referred to internally as "Green Jackets". The Green Jacket
files contain privileged information about prosecutions, as well as evidence of
investigations and recordings from interviews with agents.
422.123. It should be borne in mind that the Security team is spread nationally and
its files are not just circulated within the team. They could also be circulated
amongst Post Office's Legal or Fraud teams, or to external legal advisers. Files
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were also sent out to various members of Post Office's staff for review as part of
the Mediation Scheme.
Branch records
423,124. Agents are required as part of branch accounting processes to run certain
reports every month and retain a paper copy. Once an agent's contract terminates,
Post Office will typically remove this documentation from the branch and store it
off-site with Iron Mountain. Destruction of files within Iron Mountain's facility has
been placed on hold
424.125, The paper reports are not printed on A4 sheets but on till rolis,- These rolls
will-each-beare several feet long. Each branch will have generated reports each
month, potentially generating dozens of boxes of paper over the course of several
years. To catalogue, review and disclose all of these till rolls will would be a large
task for Post Office, even bearing in mind the logistical difficulties of trying to scan
or copy sections of numerous long til rolls. (28K Kathiferindekfer Iron Mountain”
Boxit to see how much stored here].
Training records
425.126. The format of how training is recorded has changed significantly since
2000, as well as where these records are stored. As a starting point, Post Office
does not maintain a central database or training record for each postmaster
426,127. Prior to 2010, some records of training were held in the E-Filing Cabinets.
Training records held here include records of "post transfer visi
its" to branch (i.e.
visits made a by a Post Office representative to the branch after it had opened).
These visits usually occurred at a month after opening, then 3 months after opening
and at 6 to 9 months after opening. At these visits, training could be given in
response to any needs of the postmaster. Further information on classroom
training, for example, might be held in emails of the training team, many of whom
have now left Post Office's business. Some of these emails will have been saved
to the E-Filing Cabinets but this is dependent on human action. Records of training
prior to 2010 will therefore be limited to items that have been saved to the E-Filing
Cabinets and to those items that have been recovered from Royal Mail.
427128. After 2010, the training team and audit teams combined to make the Field
team. Their records were then held on a platform called EASE (see paragraph [ref]
for more information on this). The audit team were providing ad hoc training at
audit if a need arose. Notes of training given to branches could be held in audit
reports or emails, as well as within the records of post transfer visits. The Field
team also began using records called a "performance standards assessment” to
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record the postmaster's scoring during training and an action plan to improve on
their training outcomes.
428,129. From January 2014, Post Office began to use a Branch Contact File
spreadsheet to record initial training that was given to postmasters as well as
further contact with them after that. However. these files were only used foragents
that joined Rost -Office's network from January 2014 onwards.There is no sir
document from before 2014. [CONFIRM
429.130. In order for Post Office to disclose all training records for the Claimants,
and without specificity as to what precisely Post Office is alleged to have wrongly
done or not done and when, it would potentially have tobe necessary to conduct a
search of EASE, Knowledge Centre, the E-Filing Cabinets, the SharePoint sites for
the Contract Advisers and Field teams, as well as the emails, One Drives and any
relevant network drives of anyone who has been involved with training in any form
since 2000. This task will be made more complicated by the fact that the search
will not be targeting a specific document, since the format and title of documents
regarding training has changed. Providing disclosure of all training records, or even
those for all Claimants, would be a massive task.
Generic Disclosure
430.131 In the paragraphs below, I discuss the 7 categories of disclosure that the
Claimants seek in paragraph 3 of their draft order (Generic Disclosure) in light of
the background information set out above. Overall, I would suggest that the
Claimants requests are a massive fishing expedition that-are-either- unworkable-or
Complying with them would
certainly be vastly expensive and would take many months.
Horizon system architecture
430-4131.1___In paragraph 3a of the Generic Disclosure, the Claimants are seeking
documents about the system architecture of Horizon.
434.132. Horizon is not one single system, but a system made up of several small
systems linked together. Horizon feeds into several tools used by Post Office,
including HR SAP, POL SAP, Core Finance and HORice.
432.133, The Horizon system itself has undergone many changes since it was first
introduced in 2000, with Horizon Online introduced in (daté]. In the original Horizon
system before it was retired these changes were released in batches for different
parts of the system. There were dozens of major releases on the main system,
with many more minor releases. Since the introduction of Horizon Online there have
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been 15 major releases, each with up to 10 sub-releases. Any of these could
contain a number of changes in functionality driven by code changes.
433.134, There is also a programme of patching and updating of operating systems
and associated code changes, where required, to maintain the relationship
between Horizon and other systems that communicate with it, These could also
fairly be considered to be changes to Horizon.
434.135. Fujitsu keeps a library of the key technical documentation regarding
Horizon and Horizon Online in a content management system called Dimensions.
Dimensions holds 4,165 live technical documents for the current Horizon system,
There are also 22,025 technical documents for historical versions of Horizon.
These may be old documents that are no longer used or previous versions of
existing documents, with the version number now up to 36 on some documents.
These documents range from high level designs to detailed designs of the system
and its code, along with documents that describe hardware that is used in the
system.
435-136. Whilst the documents do show the date they were updated and signed off,
for an expert to read into the system would be an incredibly time consuming task.
In order for that expert to understand what the system looked like on a particular
date, they would need to digest all of these documents, check for the version of the
documentation that was in force on the date in question and link each relevant
document together to recreate a picture of the system on that date. Fujitsu doubt
that this would create a perfect picture of all aspects of a historic version of Horizon,
but believe it would allow an expert to understand the high level systems’
architecture on a given date.
436.137. On average, around 250 to 350 people at Fujitsu work on the Post Office
account at one time although this number varies depending if project work is being
undertaken. Consequently, there have been thousands of people at Fujitsu who
have worked on Horizon over the 17 years since the system was developed and it
is not now possible to trace who worked on the system at what time. All of these
people will have created emails, documents and draft documents in addition to the
technical documents described above.
437,138. Documents are sometimes stored in a SharePoint site for project work at
Fujitsu. Emails discussing the development of Horizon are not routinely stored in
SharePoint and are held typically in work email accounts. Fujitsu staff may also
store documents on their local computers. Fujitsu estimate that they might
generate anywhere between XXX and XXX docliments and emails each year
regarding Horizon.
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438.139, Consequently, whilst the Horizon technical documentation can, with
Fujitsu's consent, be located and extracted relatively easily, to capture all
documents regarding the Horizon system architecture would require a massive
search of potentially hundreds of peoples’ email accounts, laptops and SharePoint,
sites. In my view this is a disproportionate exercise at this stage in the litigation,
especially where the Claimants have made little attempt to identify the alleged
problems in Horizon with which they are concerned, and so narrowing down the
exercise to targeted areas would not be possible.
439.140. It should also be noted that not all these documents will be under Post
Office's control. Fujitsu maintains some documents for Post Office to which Post
Office has a right of access, and-bul there are many other documents that are
Fujitsu's internal documents or commercially sensitive know-how which are
privatebelong to and are confidential to Fujitsu. Distinguishing between these-two
categories_is_not_always-straight_forward_as_contractual_access-rights-are-not
iptive-as-toth hip-of eortain-doouments--Post Office will therefore be
reliant on Fujitsu's cooperation in gaining access to certain documents.
440.141 Moreover, I understand that these documents may contain highly sensitive
information about the security controls in Horizon. Public release of this information
could undermine the security of the system. This is a particular concer in this
litigation, where the Claimants have repeatedly been leaking information about this
litigation to the media [WHAT IS MEANT BY THIS? THIS IS A SERIOUS
ALLEGATION AND WOULD NEED TO BE BACKED UP BY EXAMPLES] and a
number of the Claimants have convictions for dishonesty offences.
444.142. The above concerns also apply to the technical documents library, though
at present Fujitsu are willing to allow access to those documents on a voluntary
basis subject to certain safeguards. Those safeguards are that (i) the Claimants’
‘expert initially views the technical documents at Fujitsu's office in Bracknell and (ii)
the IT expert [and Freeths?] signs the Non-Disclosure Agreement at Schedule 2 of
Post Office's draft Directions. If copies of technical documents need to be later
provided to the Claimants, then this can be considered once those documents have
been identified and the sensitivity of their content understood by both sides to the
litigation.
442.143. In the meantime, Fujitsu have identified what they believe to be the [2] best
documents describing Horizon. These are listed in Schedule’ 1 of the Defendant's
draft Directions Order and Fujitsu are prepared to release these directly to the
Claimants’ IT expert.
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443.144. I believe that this iterative approach to disclosure will give the Claimants
access to the information they need without the disproportionate disclosure
exercise that they are proposing.
Bugs, errors or defects in the system
444.145. In paragraph 3b of the Generic Disclosure, the Claimants are seeking
disclosure of bugs, errors or defects in the Horizon system which were, or may have
been, the cause of discrepancies or alleged shortfalls attributed to the Claimants.
This request is extremely broad and based on the very vague allegations in the
‘Amended GPOC (see paragraphs 22 to 24 of Amended GPOC), which provides
the only basis on which Post Office could presently quess as to whether or not an
bua or defect (if detected) “may” have been the cause of a discrepancy or shortfall.
To comply with it would be extremely difficult and very costly, and likely produce
lots of irrelevant material
445.146. Fujitsu have said that they do not have a single database or location where
this-information in relation to bugs and defects is stored. Relevant-Potentially
relevant information may be found in several databases, as well as in emails and
documents generally produced by Fujitsu or Post Office. Searching for these
documents would therefore require the same massive disclosure exercise as
required for dealing with the Horizon system architecture. Indeed, these two issues
are inter-related as the discovery of a "bug" may result in-cause a change to the
system architecture and a change in the system architecture could in theory be the
cause of a bug. Without further specificity as to what bugs or errors there are
alleged to have been (and when), dDealing with one of these topics without the
other would therefore be—a—disproportionately—expensive—and—duplicative
‘exerciseprobably not be possible.
446.147. There are however two key databases that will-ip-due-coursemay need to
be search
the Peak System and the Known Error Log.
447.148. If Fujitsu identifies an issue in Horizon that requires a programmatic fix
then it is logged in the Peak System and labelled as a ‘Peak’. If it is deemed to
need new code to fix the issue then this is produced and tested before release into
the Horizon system. The majority of the contents of the Peak System will relate to
ideas and code that never entered the live Horizon environment, since it contains
records of the development of fixes. If a fix is approved then it enters the live
environment and the technical documentation for Horizon is updated accordingly.
There are XX Peaks in the Peak System [get from FJ}.
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448.149. The Peak System does not contain all the information about a Peak; this
information may be stored in lots of places across Fujitsu including in email
accounts. The Peak System is also a database, rather than a traditional document
type, and therefore it is technically difficult to copy the whole thing in a way that can
be readily understood. It is easier to extract particular Peaks [FJ to confirm] but
that would require a search of all the Peaks to identify the relevant ones.
449.150. It should be noted that many of the Peaks have no impact on branch
accounting at all and relate to an entirely separate part of the system [FJ to confirm)
and can range widely in the type of issues they address, including covering more
minor points such as problems with printing.
Known Error Log
450.154 Fujitsu maintains a “Known Error Log” (KEL) which is used by its support
teams in troubleshooting issues in branches. It is a knowledge base document
which explains how to deal with, or work around, minor issues that can sometimes
arise in Horizon for which (often because of their triviality) system-wide fixes have
not been developed and implemented. It is not a record of software coding errors
or bugs for which system-wide fixes have been developed and implemented.
454,152. The KEL is also not a traditional document, but a live and proprietary
database with approximately 4,000 entries. Like the Peak System, extracting data
from it is difficult to do in a user friendly format. Moreover, since the KEL is a
constantly rolling document, the current version in use has evolved over time and
may not reflect the version in place at the time which is relevant to the Claimants!
claims.
452,153, For the reasons stated above providing copies of the Peaks and KEL is
not easy to do and prone to being a disproportionately expensive exercise,
producing much irrelevant information. Post Office has therefore offered in
correspondence to Freeths an opportunity for the Claimants’ IT expert to inspect
the KEL. In its draft Directions Order, Post Office is extending this opportunity to
include the Peak System. I believe that this is a more proportionate way to proceed.
It will allow the Claimants’ IT expert to familiarise himself with these records and
then be able to make better targeted requests for further disclosure in the future.
By contrast, the Claimants’ approach would require a massive review of [hundreds
of thousands] of documents held by Fujitsu. Even then, I do not believe that Post
Office would be able to identify all the relevant material given that the Claimants’
pleadings on Horizon are so vague and we therefore do not know what might be
relevant.
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Operation of the helpline
453.154. In paragraph 3c of the Generic Disclosure, the Claimants are seeking
documents in relation of the operation of the helpline. The Amended GPOC and
SOls are again vague as to the alleged problems with the helpline-meaning
454,156. First, there is more than one "helpline" available to postmasters and the
different helplines have different documents and store them in different ways.
485.156. The NBSC is usually the first contact point for queries from branches for
operational support. On average, over the last 17 years, between 50 and 70
members of staff have worked at the NBSC at any particular point in time. NBSC
receives on average 35,700 calls per month (based on data obtained for 2016/17).
Inote that the allegations in the Amended GPOC about the helpline talk about Post,
Office having instructed staff in general to do or say something or make allegations
about how the helpline is run in general, rather than targeting specific advice given
by the helpline to a particular Claimant on a particular day. Post Office may
therefore need to trawl millions of calls and gather disclosure-documents from
hundreds of staff in order to be disclosure relevant to these allegations.
Knowledge Base
486.157. NBSC advisers all have access to a tool called Knowledge Base which is
used to answer questions. There are currently around 5,000 different articles within
Knowledge Base. NBSC advisers access the Knowledge Base through Dynamics
and are directed to different articles depending on how the categorise the call.
457,158. Until 2014 there were no dates on the articles in Knowledge Base to show
when it had been changed. Therefore unless there had been a specific, one-off
‘event for which advice was created it would not have been possible to know what
the Knowledge Base would have said at any time. {IS THIS RIGHT? WOULD
META-DATA NOT PROVIDE THIS INFORMATION?)
458.159. Since 2014, links to the relevant article in the Knowledge Base have been
included in the call records in Dynamics (described at paragraph XX above).
Assuming that the Knowledge Base has not been updated since the call, it might
be possible to trace what article the NBSC adviser referred to. However, to provide
disclosure of all of these articles would require a manual review of the call logs for
each branch and then a search of the Knowledge Base for that article.
459.160. Given the lack of particulars from the Claimants itis therefore not possible
at this stage to identify which bits of the Knowledge Base may be relevant to the
Claimants’ claims. This only leave the option of disclosing the whole Knowledge
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Base of around 5,000 articles. This would be a difficult thing to do because.
fits
a database that is not easily extracted, etc, it would therefore require manually
printing that would take....XXX days, etc.KB is hosted on SharePoint — seeking
Clarification as to how can obtain articles] [AT PRESENT, THIS SOUNDS EASY
TO ME, SO I WOULD ONLY SAY IT IS DIFFICULT IF THERE IS A STRONG
BASIS FOR SAYING SO}
Call Logs
460.161 As described above at [para], logs of calls with agents at the NBSC are
entered into Remedy or Dynamics, which could be deemed to be records relating
to the operation of the helpline. The logs describe briefly the nature of question
and the answer given, if appropriate or may refer to an article in the Knowledge
Base.
464.162. It should be possible to give disclosure of logs of calls that were actually
made by Claimants. In line with Post Office's obligations to preserve relevant
documents, call logs for some of the Claimants have already been extracted and
preserved in an online data room, with more call logs to be extracted shortly.
Call recordings
462,163. NBSC has been recording calls since 2014 for training and monitoring
purposes.
463-164. Call recordings are deleted after 3 months unless they have been retrieved
for a Contract Adviser as part of an investigation and that Contract Adviser has
saved the call onto SharePoint. No preservation action has been taken in respect
of the call recordings as this would require a rolling preservation programme for
Post Office at significant cost and the pertinent details from each call with have
been recorded into the call log in Dynamics. [D0 THE CLAIMANTS KNOW THIS?
LTHINK THEY WILL SHOUT AND JUMP IF THEY DON'T]
Other documents
464.165. Other documents generated on the operation of NBSC include training
materials. New NBSC staff receive training and ongoing training is provided to
NBSC staff on new products and services as they are introduced. There will also
be other planning documents on the operation of the NBSC. These will generally
be stored in emails and potentially on SharePoint and so accessing these materials
would require the capture and review of potentially dozens of email accounts and
laptops. Information on staffing planning is contained within a system called Verint.
The Amended GPOC does not currently explain if these materials will be relevant
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and so it is not possible at this stage to undertake a disclosure exercise on these
materials as Post Office has no way to determine their relevance.
Horizon support
465.166. Post Office and its agents have access to a help desk called Horizon
Service Desk (HSD) to manage technical issues with Horizon. The HSD is currently
provided by an external IT provider; ATOS and was previously provided by Fujitsu
prior to June 2014.
466.167. Both Fujitsu and ATOS retain logs of calls from their tenure running the
HSD. However, it will be technically very difficult to access logs from during
Fujitsu's tenure between 2001 and September 2009. This is because the call
logging system Fujitsu used for this period (Powerhelp) was taken offline due to it
being run on redundant software (Windows 2003).
467.168. Fujitsu has advised that the Powerhelp servers are still stored but they do
not currently have the means to access them; they would have to recreate a ring
fenced network running Windows 2003. Fujitsu estimate that the cost of attempting
to access the Powerhelp data could be up to £50,000 with no guarantee of
success. There would also be a cost for maintaining access to the data if the
restoration was successful, but Fujitsu is unable to provide a quote for this until a
solution has been devised.
468.169. ATOS estimate that to retrieve their call logs for around 50 branches over
a 4 month period would take 10 working days and cost up to £5,000. To retrieve
the HSD call logs from ATOS for all of the branches and for their full period of tenure
will cost significantly more.
469.170. As stated above, Post Office's IT engineers are provided by
Computacenter and Fujitsu may also be involved as well. If ATOS is unable to
resolve the issue over the telephone, then ATOS may seek support from
Computacenter and Fujitsu and they may hold relevant records of this support
[awaiting info from Mark on this]. Like with the Horizon documentation, it is likely
that some of this material may not be within Post Office's control and so again
substantial effort will be needed to identify material under Post Office's control,
which will require cooperation from Computacenter and Fujitsu.
470.471 In light of the above, unfocused disclosure of documents selevant-relating
to helplines is-would be a massive exercise and liable to either miss relevant
documents or over disclose irrelevant documents. The key material will be the logs
of calls made by Claimants to the NBSC helpline and Post Office can provide
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disclosure of these in a proportionate manner if limited to a reasonable number of
Claimants.
Conduct of investigations
474.172. In paragraph 3d of the Generic Disclosure, the Claimants are seeking
documents on the "conduct of investigations’. However, the GPOC is unclear on
exactly what “investigation” means. I understand that “investigations” could include
the activities of various teams at Post Office including the FSC, Field Support,
Fraud Analysis, Cash Management, Security and Contract Adviser teams.
472.173, The Cash Management team manages cash holdings in branches across
the Post Office network. It monitors unusual holding levels and also responds to
requests from branches to increase the amount of cash delivered.
473.174. The Fraud Analysis team reviews reports from the Cash Management
team and may flag branches for intervention (such as a telephone call or physical
audit). In tum the Fraud Analysis team may escalate to the Field team for an audit.
Depending on the outcome of audit, both the Contract Adviser team may then
become involved to decide if action needs to be taken on the agent's contract or
the Security team may become involved if criminality is suspected. All of these
teams will share information between each other.
474.475. Policy documents for all of these teams will be held in different places
across the business. The Contracts and Policy Development Team develops
policies for the business, in particular the Contract Adviser Team, and often works
closely with Legal and the Contract Adviser Team. Whilst the Policy team drafts
the policy, guidance on interpretation is held within these other teams too, for
‘example the Contract Adviser Team may also issue informal guidance and updates
by email or memo to its members. Locating informal guidance would require a
search of email inboxes, laptop hard drives and One Drives for all Contract Advisers
since 2000. The Contract Adviser team has had [number] of employees since
2000.
475,176, The Policy team has since [date] used a SharePoint site for documents
but prior to this some documents were kept in paper form with patchy records
retained. To locate old records of policies, Post Office would also need to look back
through the records of former people in the Policy team for outdated documents no
longer in use as old documents may no longer have been kept. This may involve
pulling archives of hardcopy documents stored in Iron Mountain.
476.177. As mentioned above, the Field team conducts audits. Whilst some audit
reports may be found within the Contract Adviser files, audit reports are currently
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held on SharePoint. The audit reports may be in the form of an email or a
spreadsheet but are clearly identifiable as a report prepared following a branch
audit, with a summary table showing any shortfalls that were found and in respect
of which of Post Office's assets.
477-178. The audit team used to use a platform called EASE to keep its policy
documents, including templates for intervention requests and audit reports, audit
manual and changes to process, products or operational changes. THowever-the
platform was due to be replaced last year but an update on this is awaited. In
anticipation of the replacement of EASE, most documents have been moved to a
new platform called Knowledge Centre but they have not been structured within
Knowledge Centre;; it is an unsorted collection of old and new documents. It will
require a lot of work to review and find manuals that applied to agents at any
particular time. In the same way as the Contract Adviser Team, there is also likely
to be informal guidance issued to team members that would need locating and the
audit team has had XX team members of the last 17 years.
478-179. In light of the above, Post Office considers that to give disclosure in relation
to "investigations" would be a massively disproportionate exercise, requiring it to
review years of emails and documents and then largely guess at what might or
might not be relevant in light of the vaguely pleaded issues in the GPOC.
479.180. Moreover, several of the Claimants have been convicted of criminal
offences and there are questions over the honesty of other Claimants. The Fraud
Analysis, Cash Management and Security Teams will-be reluctant toare concerned
that, unless protective measures are put in place, disclosing ¢-their process and
Policy documents, especially to current postmasters, because -this-putswould put
Post Office's cash at risk if its postmasters-know-what- maybecause it would reveal
what indicia are relied upon to trigger an investigation. Without revealing the precise
nature of the controls that are in place, I can only say that Post Office considers
that a postmaster aware of the precise controls and triggers would be far better
able to remove Post Office cash or stock without this being apparent to Post Office.
‘Such-It may well be that disclosure of these policy documents, if / when needed,
will need-have to be made subject to special confidentiality terms in-orcier-to-avoid
yr other protections.
Training policies and practices
480.181 In paragraph 3e of the Generic Disclosure, the Claimants are seeking
documents on training policies and practices, particularly where Post Office
imposed new practices or systems or required new services.
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484.182. Post Office provides a combination of classroom and on-site training for
new postmasters depending on the postmaster’s previous experience (since some
may already have been or be operating other branches). The materials for these
courses have changed over time depending on the products offered by Post Office
and its policies. For some of the courses, there are also scripts on how to deliver
the training or notes packs.
482.183. Whilst training is given when an agent first joins the Post Office network or
when their branch undergoes a change of model, training is also given at various
other points in time. For example, if the Branch Standards Team spots identifies a
need :or training may be given by the Sales team on products.
483.184. When auditors visit a branch and see that processes are not being
followed, they may give on the spot training. Training given may be recorded in the
branch file or in an audit report but there are no guidance notes or documents on
this kind of training as it is ad hoc and relies on the auditor identifying and
addressing a specific fling-a-need.
484.185. Retention of training materials for the initial training courses depends on
the staff responsible for developing the materials having kept them. Some training
materials have been uploaded to SharePoint, some are kept on One Drive and
some have been kept on the hard drive of staff members. To attempt to locate all
of the training materials, Post Office would need also to contact all trainers since
2000 to collect the materials they were sent that have not been kept. Approximately
[number] of "trainers" have worked for Post Office since 2000.
485.186. Again, the allegations in the Amended GPOC are very imprecise. They do
not target particular types of training, but call into question-<i training of all types
given by Post Office over 17 years. As things stand, the Claimants’ request for
disclosure would require Post Office to search for and review hundreds of
thousands of documents and then guess at what might be relevant. I anticipate
that this would lead to the disclosure of tens of thousands of irrelevant documents
The better way to proceed would be for each Claimant to identify, with specificity,
the aspects of their training that they believe vec: were deficient and then Post Office
can provide further disclosure on these issues in a more targeted fashion.
Post Office suspense accounts
486.187. In paragraph 3f of the Generic Disclosure, the Claimants are seeking
documents relating to Post Office's suspense accounts, with no clarification of what
this means.
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487,188. The Letter of Claim did not make any allegation in relation to suspense
accounts.
488-189. The Claimant's 62-page substantive letter of 27 October 2016 just referred
at paragraph 23 to “circumstances where Post Office holds surpluses in suspense
accounts, which after 3 years are credited to its profits" and alleged that Post Office
benefits from errors wrongly attributed to Subpostmasters. This allegation that Post
Office benefited from shortfalls that were not a real loss was repeated at paragraph
72. However, no details of precisely what was meant by a suspense account were
included.
489.190. The Amended GPOC repeated this issue, in that it refers at paragraphs 38
and 39 to suspense accounts in which Post Office is alleged to have “held
unattributed surpluses" and that after "3 years, such unattributed surpluses were
credited to the Defendant's profits"
490.191 No further information has been provided by the Claimants as to what they
mean by "suspense accounts". From discussions with Post Office's finance team,
I understand that the term "suspense account" does not have a fixed meaning in
accounting jargon; it is a generic accounting term. This broad topic was briefly
discussed during the Scheme with Second Sight, but it is not clear-however Pest
Office should net be made to guess that_whether the Claimants’ case isthe same
as-the enquiries raised -by is based on and/or goes beyond the points raised by
Second Sight. t-these-eng ! iLpartot J
‘Sight's-work.—It is therefore unclear as to what is-meant-bythe Claimants mean
when they refer to a suspense account or unattributed surpluses. I note that the
Claimants have taken issue with this and have alleged in the Generic Reply that
Post Office must know what is meant, which I would suggest is a regrettable
allegation to have made (given that Post Office's Generic Defence is clear on this
point and is confirmed by a Statement of Truth). In any event, I will explain further
why the Claimants’ allegations are unclear.
494,192. The Claimants appear to allege that there are specific suspense accounts
where monies are held that have not been resolved, with Post Office then benefiting
from those discrepancies because they are released to profit. As there is no fixed
definition of a suspense account, any account operated by Post Office could in
theory be used as a suspense account-so, and identifying suspense-accounts that
may, at one time or another, be considered to have operated in part as suspense
accounts is difficult.
492.193. Within Post Office's finance system, POL SAP, there are around [XXX]
accounting ledgers [ask Deloitte for this]. Post Office's finance teams have been
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asked to identify which of these might be classed as suspense account. They
estimated that there are 119 ledgers that might fal into this bracket, however this
exercise was fraught with difficulty and subject to numerous assumptions as to what
a-suspense-account might be—Precisely how to classify an account's functions
from time to time (given that Post Office has no single procedure in this regard).
These ledgers contain around XXX [Get from Deloitte] accounting entries.
However, these accounts were not just used for "suspense account" type
movements but other purposes as well, such as moving items between back office
accounts and profit and loss in the usual course of business.
Until such time as the Claimants properly explain what they mean by a “suspense
account’, the Claimants’ current request for disclosure would require a disclosure
of all accounting information in at least these 119 accounts, much of which would
be irrelevant. Provision of
information in a usable format would not be
straightforward as it would be coming in a database format that is not readily
accessible without certain software. Moreover, unless the Claimants intend to
undertake a forensic accounting exercise on this data, I cannot see what utility this
information would be to the Claimants at this stage. As far as I am aware the
Claimants have not yet engaged a forensic accounting expert, and there has been
no request for an order permitting expert evidence of this kind.
493.195. I also-would note in this regard that Post Office already has experience of
disclosing documents to the Claimants that the Claimants do not then review or use
in even the most basic ways. Specifically, that-when-my-firm_although Post Office
provided the Claimants with access to around XX contractual documents, it became
clear that these documents were-nethad not been reviewed for the purpose of
preparing the SOls: see [...] and the reference to Claimants who claimed not to
have had sight of the very contractual documents that had been disclosed to them.>
I am therefore concerned that Post Office may incur significant cost -in disclosing
accounting information that may then not be used by the Claimants.
Documents delivered up by Second Sight
494,196. At paragraph 3g of the Generic Disclosure, the Claimants are seeking
disclosure of 35,000 documents delivered up by Second Sight following termination
of its contract for services to Post Office arising out of the Scheme (described at
paragraphs XX to XX in Parsons 2).
496-197. These documents contain a significant amount of privileged material that
would need to be removed. It will also contain irrelevant material relating to people
who are not Claimants and the operations of the Scheme.
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496.198. A significant part of the documents are large numbers of emails with drafts
of reports and internal Second Sight discussions on particular cases before
finalising their reports. The-mostit would stand to reason that the most important
documents-will beinteresting documents would be the reports actually produced by
Second Sight (rather than documents showing only what Second Sight might have
considered saying but did not),-during the Scheme-and the Claimants already have
these. The Claimants also have direct access to Second Sight. It is therefore
unlikely that much further material value-that the Claimants may wish to use could
be extracted from these documents, even were any of the Second Sight material
likely to be admissible and of any real value in determining any disputes of fact. -
497,199. Fo-L estimate that to review the documents retumed by Second Sight will
take [hours] and cost [£]. Nevertheless, Post Office is prepared to do this so-Jong
and-are-not privileged-on the basis set out draft directions.
Standard disclosure in Lead C:
498.200. For the reasons stated above, giving so-called generic disclosure of the
type sought by the Claimants willLwould be very difficult because of the lack of
specificity in the claims, the wide date range of the Claimants’ claims, the different
locations in which documents are held and the different teams that will hold them.
Fhis-is-thenThe difficulty is compounded by the ambiguities in-thelack of clarity in
the Amended GPOC-and, the SOls and the Generic Reply.
499.201 In the same way, the proposal for "standard disclosure" on Lead Cases
sought by the Claimants at paragraph 2 of their draft Directions will also not be
effective or proportionate.
200.202. FirstTthe Claimants are not requiring Lead Cases to be pleaded before
disclosure is given. Post Office will not therefore know what specific issues each
Lead Case is raising, such that it does not make sense to talk about “standard
disclosure’: in the absence of pleadings, there would be no fact-specific allegations
and issues on the Lead Claims that would enable the CPR test to be applied in any
meaningful way. This makes giving standard disclosure on Lead Cases impossible,
as Post Office has no way to determine the relevance of documents to a Lead
Case. It iid be materially th ime exercis I have descrit for the
)-called “generic disclosure” and woul iffer from the ime problem:
204.203. Second, even-if pleadedit does not presently appear that the Claimants
would intend to plead specific allegations ;-standard-disclesure-of-in relation to
Horizon even for the Lead GasesLead Claims, such that (to the extent disclosure
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could sensibly be given at all on those issues), standard disclosure on Horizon
would necessarily require—dise _-many-of th " .
order for standard disclosure on a Lead Casegive rise to all would therefore result
in-allthe problems outlined above in relation to Generic Disclosure on that topic. If
and to the extent that a Lead Claimant also failed properly to plead out the alleged
breaches of duty in relation to matters such as training, many of the problems
identified above in relation to that issue would also arise.
SECTION 3: POST OFFICE'S PROPOSED DIRECTIONS
202.204. Post Office's proposed Directions are at XX.
203.205. Post Office agrees with the Claimants that selecting Lead Gases-Claims is
‘useful way to proceed. Hi -ithas-alse proposed {in my frn's letter of XXMy
firm _has identified in this regard}-that a number of potential preliminary issues,
principally focused on contractual and legal duties between the parties—are
addressed-at-an-early-stage-and-that. It may be that Lead Gases-Claims should
could be used to decide contested questions of fact at a preliminary issues trial. In
order to use Lead Gases-Claims in this way, Post Office believes that they first need
to be pleaded. These matters are addressed in more detail in Post Office's
Skeleton Argument.
204.206. In order to assist with pleading Lead Gases Claims and, in parallel, to make
such progress as_can be made oon the vague and unclear allegations issues
aroundin relation to Horizon, Post Office is prepared to give a substantial amount
of early disclosure. I discuss this below at paragraph XX. I should make clear that
this is without prejudice to my client's position that there is no properly pleaded or
sustainable claim (even at a generic level) in relation to Horizon.
206.207. Post Office's directions also include requests for further information:
205.4207.1___Itis seeking further information on limitation and settled cases given that
cover 50% of the Claimants may be liable to be struck out on these grounds. The
SOls do not address these points and the Generic Reply deals with them in just
two short paragraphs (at XX and XX of the Generic Reply). Further information is
therefore desperately needed if the parties are to avoid wasting significant
resources fighting-casesin relation to claims that might-be struck outcannot
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possibly succeed for limitation reasons. Paragraph XX below sets out more detail
of the Claimants who may be affected by these issues.
205.2207.2 Post Office is also calling for more information on quantum and false
accounting because these matters were not addressed adequately or at all in the
SOls. I refer to my firm's letter of 1 September 2017 (at XX) that sets out the
deficiencies in the SOls and for the sake of saving time do not repeat this material
in this statement.
206.208. Finally, Post Office is also asking for a number of claims and Claimants to
be struck out because, respectively, they have not been pleaded or the Claimants
do not have standing to bring claims. These-matters-are-addressed further in Post
Office's Skeleton Argument,THESE NEED TO BE SET OUT HERE ~ WE DO NOT
HAVE THE PAGES TO SET OUT THIS DETAIL IN THE SKELETON ARGUMENT]
DISCLOSURE ALREADY GIVEN
207.209. For the reasons I have set out above, Post Office has ne-desire-to-block
disclosure-but-it-has-serious concerns over the Claimants' Proposed Disclosure;
and does not, in
short, consider it to be workable let alone proportionate. This has also to be put in
the context of the large amount of disclosure that Post Office have already given
voluntarily.
208.210. By their Letter of Claim of 28 April 2016, the Claimants made 32 wide-
ranging requests for disclosure, many of which were not relevant, reasonable or
proportionate, particularly where grounds for the disclosure had not been
particularised, or were subject to privilege. By Post Office's Letter of Response of
28 July 2016, it agreed to provide disclosure in respect of 8 of those requests (as
far as it was reasonably able), requested clarification in respect of 4 of the requests
and referred Freeths to their clients in respect of 4, since documents in respect of
these would in many respects have been provided as part of the Post Office
Complaints Review and Mediation Scheme (Scheme). It should be understood
that as part of the Scheme, many documents (amounting to hundreds of pages for
most Claimants) were shared with the Claimants.
209.211. On 31 August 2016, Post Office gave disclosure of the following items;
209.4211.1___Copies of the contractual documents and variations between Post Office
and its agents. These included;
209.4.4211.1.1_Subpostmaster contract (consolidated version)
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209.4.2211.1.2 Acknowledgement of appointment of subpostmaster
209.4.3211.1.3_Branch standards booklet
209.4.4211.1.4 Branch standards contract variation
209-4.6211.1.5 Conformance booklet
209.4.6211.1.6 Subpostmaster Paystation terms and conditions
209.2211.2 Fujitsu contract
209-3211.3 Course materials for Horizon training
209.4211.4 Audit guidelines
209.5211.5 Documents surrounding the termination of the Scheme
209.6211.6 __Draft witness statement of Martin Rolfe (regarding an allegation of
“remote access" to Horizon)
200.7211.7 Internal email correspondence between Alan Lusher and Andrew Winn of
Post Office regarding branch accounts
209.8211.8 Post Office documents on certain Horizon issues previously discussed
with Second Sight.
209.9211.9 _ Second Sight's terms of engagement
209.40211.10 _Post Office notes on retract fraud on ATMS and audit trails on Girobank
deposits
209.44211.11__A report by Graham Brander of Post Office on the investigation into the
branch run by Josephine Hamilton (Claimant 69)
209.42211.12 The Scheme rules
209.43211.13 The Scheme Working Group's terms of reference
209.44211.14 Minutes of the Scheme Working Group's meeting of 17 October 2014
209.45211.15 Post Office notes on suspense accounts
209.46211.16 _A sample branch trading statement
240.212. As noted above [ref] Post Office had referred Freeths to its clients for
several of the documents being sought. Although the-Freeths confirmed on 29
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March 2017 that they had "advised all of our clients in respect of their obligations
to preserve all disclosable documents", no confirmation of what documents the
Claimants hold that would assist them or narrow their disclosure requests has been
given._The Claimants’ disclosure report, filed_on 4 October 2017, provides
practically no information in this regard and is entirely consistent with no work
having been done by the Claimants in this regard. Additionally, the Claimants have
also-to date declined to give any disclosure of their own.
244.213. The only information with any detail on individual claims received from the
Claimants is contained in their-Schedules-of tnformationthe SOls. Post Office's
serious concerns about the Schedules of Information is set out at para X above.
242.214. The disclosure given by Post Office also does not appear to have been
properly considered by the Claimants. As an example, on 10 April 2017, Post Office
gave disclosure of 140 contractual documents for the Claimants, which took at least
100 man hours of Post Office's time as well as the costs of Bond Dickinson in
assisting in the collation and review of the contracts
243.216. Having undertaken such a large and costly exercise, this firm asked the
Claimants to "undertake a similar exercise in locating the contractual documents
held by each Claimant" to ensure the parties held matching documentation and to
help fill the gaps for contracts Post Office had been unable to find (in part due to
the time since some of the contracts were terminated): [REF TO LETTERI...No
such contracts have been provided by the Claimants
244.216. However,_as I have explained above, on reviewing the Schedules-of
JnformationSOls, it could be seen that the disclosed contractual documents had not
been taken into account. Examples of this are set out in this firm's letter of 1
September 2017 at paragraphs [.
EARLY DISCLOSURE
246.217. To address the problems with the Claimants’ disclosure orders, Post Office
proposes a more targeted approach. This disclosure is designed to provide:
246.4217.1___documents that will assist the parties in pleading as to the Lead
GasesClaims;
245.2217.2 __documents that will help the Claimants understand better Horizon's
operations and, if appropriate, help the parties to make progress on discussing
case management in this regard, including as to any formulate-better orders for
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‘expert evidence and disclosure in relation to Horizon that may be appropriat
and
246.3217.3 documents that are connected with the further information being sought
by Post Office.
246.218. Post Office proposes that the parties give disclosure of a number of tightly
defined categories of documents, rather than the disproportionate and troublesome
Generic Disclosure sought by the Claimants or the standard disclosure sought by
the Claimants that is impossible to give at this stage. This more targeted approach
avoids the disproportionately problems of Claimants’ directions, whilst drawing out
documents most likely to assist the parties. This disclosure is not intended to
replace standard disclosure which-might-be-viable-at-alater st this Htigati
It is a properly formulated version of staged disclosure that the Claimants agree
with in principle but have not achieved in their Directions order.
247.219. Post Office's proposed disclosure orders are paragraphs XX to XX of its
draft Directions. I explain below the categories of documents listed in these draft
orders.
Horizon
220. _ It is hoped that providing the Claimants with documents in relation to Horizon will
allow them to obtain the views of an expert and, Post Office expects, take a more
realistic view of the merit of their vaque allegations. Post Office does not accept
that any proper or viable claim has been formulated or pleaded in this regard, so it
proposes to give disclosure only to break the current impasse in which the
laimants complain that they do not know enough to enable them to plead an
proper claim.
248.221 Post Office's proposed Directions stop short of giving permission for expert
evidence because it is not possible at this stage to formulate proper questions to
put to an expert_or even to identify with any sensible degree of particularity the
issues that the expert should consider. However, Post Office proposes at
paragraph XX of its draft Directions to facilitate access for the Claimants’ IT expert
to the 25,000 technical documents that are described at paragraph XX above. This
is in addition to access to the Known Error Log and Second Sight, both of which
have already offered /agréed in correspondence. In addition, Fujitsu is prepared
to allow the Claimants’ IT expert to inspect the Peak System (TO BE CONFIRMED
BY FJ). With the benefit of this information and decisions on preliminary issues, I
believe that the parties and the Court will be much better placed to make informed
decisions about the expert evidence, if any, that may be needed in the future.
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‘Standard terms and conditions
249.222. As noted above, Post Office has already disclosed lots of contractual
documents to the Claimants and the Claimants should already have copies of their
contracts. However, to ensure that all parties are working from a common set of
standard contract terms, Post Office intends to disclose those standard terms that
cover the majority of the Claimants, being those listed at pargraphparagraph XX of
its draft Directions.
220.223. This is not a definitive list of all Post Office's standard terms, as there have
been numerous variations and addendums over last 20+ years. To disclose all
these contractual documents, many of which will be irrelevant, would require the
disclosure of hundreds of versions of contracts. It is not clear that the Claimants
want or could possibly benefit from such further disclosure.
Second Sight
224.224. Post Office is prepared to disclose the documents from Second Sight as
described in paragraph XX above.
Settlement Agreements
222.225. Post Office believes that over XX Claimants have entered into settlement
agreements that might have waived their claims in this action (as described in more
detail at paragraph XX below). Post Office now needs to understand why-the
Claimants-believe-that-theiron what basis each of the affected Claimants intends to
argue that his or her settlements are-is not binding; in the absence of a properly
articulated case in this regard, all the affected claims-as-therwise-these-claims are
liable to be struck out. This information has not been provided in pleadings, the
SOls or in pre-action correspondence. Post Office does not therefore know the
matters on which each Claimant intends to rely in order to avoid strike out and is
seeking further information in this regard at paragraph XX of its draft Directions.
To facilitate this, paragraph XX of the draft Directions orders Post Office to disclose
the settlement agreements on which it intends to rely. It is obviously not in the
interests of the affected Claimants to remain involved in complex and wide-ranging
litigation when, in reality, there is a clear and total defence based on the settlements
into which they have entered.
Medical reports
223.226. Over XX% of the Claimants have asserted a claim for personal injury in
their SOls, which presumably means psychiatric injury given that it is unlikely that
Post Office has caused a physical injury. Given that Freeths appear to have had
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No or limited involvement in the preparation of the SOls, Post Office is gravely
concerned that many Claimants have asserted a personal injury claim when no
recognisable psychiatric injury has been suffered and that this has beer-dene-to
artificiallyhad the effect of artificially inerease-increasing the total value of the
claims. Post Office is therefore calling for further information on the valuation of
the personal injury claims at paragraph XX of its draft Directions and, to support
this quantum information, Post Office is asking for disclosure of the Claimants’
medical records. I note that disclosure of medical records at an early stage is
common practice in personal injury cases and I would be surprised if Freeths and
the Claimants felt able to assert personal injury claims without having already
obtained and reviewed these medical records. It would seem to me to be improper
to have asserted a personal injury claim without even identifying the nature of the
injury alleged and to have confirmed that it is capable, if proven, of amounting to a
recoverable head of damage.
Lead Claimants
224.227. Paragraphs XX to XX of Post Office's draft Directions require disclosure of
key documents in every Lead Case. These directions vary slightly between
postmasters and assistants, and depending on whether the disclosure is to be
given by Post Office or Claimant, because each permutation needs to define the
documents differently. I run through the documents in each permutation below;
some are self-explanatory, some have been explained above and some need
further explanation as set out below. [THE BELOW NEEDS TO BE RECONCILED
TO THE FINAL DRAFT ORDER
225.228. In terms of disclosure by Post Office to a lead Claimant who is a
postmaster or franchisee (at paragraph XX of the draft Directions order), this
includes:
225.4228.1___Any application to be a postmaster or franchisee submitted by the Lead
Claimant to Post Office
225.2228.2 _Any signed Confirmations of Appointment and signed Preface between
the Defendant and the Lead Claimant. These are the contractual documents
signifying that the postmaster or franchisee accepts Post Office's terms. I note
that disclosure of the actual terms is described in paragraph XX above.
225.3228.3__ Records of any assistants employed by the Lead Claimant recorded in
the Defendant's HR database. This is taken from the HR SAP database
described at paragraph XX above.
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225.4228.4 Transaction and Event data recorded on Horizon for the Lead Claimant's
Branch(es) as described in paragraphs XX above. (Tobe confirmed by FJ]
225.5228.5 __ Customer Account from POL SAP or Core Finance (as applicable) for the
Lead Claimant's relevant branch(es). The Customer Account is a report
produced from POL SAP or Core Finance that shows shortfalls in a postmaster or
franchise's account at FSC. It shows how that shortfall has accrued, for
example at audit or if the debt has been settled centrally, and any payments or
deductions that have been made to that shortfall
225.6228.6 __Record of Transaction Corrections issued to the Lead Claimant's relevant
branch(es) as recorded in POL SAP.
225.7228.7 Written logs of calls to the Defendant's NBSC helpline recorded in either
the Defendant's Dynamics or Remedy systems (as described above at XX) as
having come from the Lead Claimant's relevant branch(es).
225.8228.8 Audit Reports in relation to a Lead Claimant's relevant branch(es). Audit
Reports are described in more detail at paragraph [ref] above and examples of
Audit Reports are exhibited to this witness statement.
225.9228.9 __Any suspension letter sent by the Defendant to the Lead Claimant.
225.40228.10 _Any termination or resignation letter sent between the Defendant and the
Lead Claimant.
225.44228.11__Any hardcopy Former Agent debt file for a Lead Claimant as described at
paragraph XX above.
225.42228.12 Any settlement agreement between the Defendant and the Lead
Claimant.
226.229, The above documents cover the full life-cycle of a typical postmaster from
appointment and training, operation of their branch, termination and then post-
termination legal proceedings. I have been personally working for Post Office for
nearly ten years and in my experience the above documents are those most
commonly referred to in any dispute between a postmaster and Post Office.
227.230. In relation to disclosure from a lead Claimant who is a postmaster or
franchisee to Post Office (at paragraph XX of the draft Directions Order) the
categories of documents largely mirror the disclosure to be given by Post Office.
The only additional category sought from lead Claimants is documents about the
losses they have suffered as only the Claimants will hold these.
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228.231 Fhese-I would readily accept that some of these orders have been drafted
slightly more broadly than those put-onrequired of Post Office because I am not
aware of the exact ways that the Claimants might hold documents. The Claimants!
disclosure report provides no assistance in this regard. ROSUOMeSISIOpsHnolany
feasonable proposal from the Claimants to narrow these categories but there has
‘been insufficient time to do this before this statement was filed.
229.232. In relation to disclosure to be given to or by lead Claimants who were
assistants (at paragraphs XX and XX of Post Office's draft Directions), the approach
has been modified to reflect the different relationship between Post Office and an
assistant but still tries to match documents to the lifecycle of branch. For example,
there is no need for Post Office disclose a lead Claimant's application to be a
postmaster as an assistant will have never made such an application.
SECTION 4: STATISTICS
230.233. In this Section 4, I provide some statistics on the number and nature of the
claims being advanced that I believe are useful context when considering
Directions. Set out in Appendix [x] to this statement is the data from which my
below observations are drawn.
231-234. __Categories of Claimants [ALP to complete once worked out the data]
232.235. Parsons 2 explained the different types of Claimants within the Group
Action (see paragraphs 69 to 86) (at pages [x] to [x]). From a review of the SOI's
provided by the Claimants, I understand that the Claimants fall into the following
groups:
232.4235.1 rr) of the Claimants are postmasters. Of theses:
232.2235.2 __[x] are engaged on the Subpostmaster contract;
232.3235.3 ic) are on a Mains Network Transformation contract
232.4235.4 [x are on a Local Network Transformation contract;
232.5235.5__ other categories}
232.6235.6 [4] of the Claimants are assistants.
232.7235.7 __[x] of the Claimants are crown employees.
232.8235.8 i of the Claimants are companies.
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232.9235.9 _[X] of the Claimants are guarantors of companies which have engaged
with Post Office.
Limitation
233.236. As addressed at paragraph [x] above, paragraph [x] of the Defendant's
proposed directions relates to the striking out of time-barred claims
234.237. My first witness statement dated 19 August 2016 (Parsons 1) (at pages
[XM] to [X}) was made in support of an application by Post Office to disallow certain
amendments that the Claimants made to the Claim Form. The effect of the
amendments would have been to prejudice the Defendant's limitation defences.
236.238. As explained at paragraph 27 of Parsons 1, Post Office is not yet in a
position to positively assert a limitation date for each of the Claimants. This is
because the Claimants have not particularised their claims to an extent which would
enable Post Office to carry out the requisite analysis to advance a detailed case on
limitation. An explanation of the issues faced in undertaking such analysis is at
paragraphs 27.1 to 28.10 of Parsons 1 (at pages [x] to [x]).
236.239. It should be noted that not all of the Claimants have the same prima facie
primary limitation date (6 years before the relevant Claim Form was issued for the
claims other than for personal injur
236-4239.1___ those Claimants who brought a claim within the original Claim Form have
a limitation date of 11 April 2010;
236.2239.2 __ those Claimants who were added to the amended Claim Form have a
limitation date of 3 August 2010; and
236.3239.3 __ those Claimants who are party to the Second Claim Form have a
limitation date of 24 July 2011
237-240. Each of the Claimants has provided Post Office with a SOI which includes
their termination date. Given that this is likely to be one of the last interactions
between the parties, it is therefore aprovides good-a rough benchmark forindication
as to the likelihood ~assessing-the-potential-for a limitation defence to-arise_be
available.
238.241 From a review of these dates, I am aware that:
238.4241.1___192 (38%) of the Claimants have termination dates prior to their
respective limitation dates. These Claimants are likely to be time-barred.
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238.2241.2 A number of the Claimants are bringing claims in relation to their tenures.
at multiple branches. 23 of the Claimants are advancing a claim in respect of a
branch where their termination date is prior to their respective limitation date,
238.3241.3 Approximately 90 of the Claimants’ engagements with Post Office were
predominately prior to their respective limitation date. As such, part of their claim
is prima facie likely to be time-barred and in the event that losses have been
sought for these periods, the losses claimed by these Claimants will be greatly
exaggerated. For example:
238.3.4241.3.1_ Margaret Boston (27) was engaged by Post Office in May 1984
and her contract was [terminated] on 14 December 2011. With a
limitation date of 1 April 2010, approximately 26 years of her claim is,
prima facie likely to be time barred.
238.3.2241.3.2 Vinod Sharma (162) was engaged by Post Office in September
1976 and her contract was [terminated] in August 2015. With a
limitation date of 3 August 2010, approximately 34 years of her claim is
prima facie likely to be time barred.
238.4241.4 Only 100 Claimants have commenced their engagement with the
Defendant within the last 6 years. These are the only Claimants where it can be
said with certainty that they will not be subject to a limitation defence.
Settled Cases
239.242. As addressed at paragraph [x] above, paragraph [x] of Post Office's
proposed directions seeks further information on Claimants who have previously
entered into settlement agreements with the Defendant. These Claimants can be
split into two categories:
239.4242.1___ Claimants who were part of the Scheme; and
239.2242.2 Claimants who were part of the Network Transformation programme,
240,243. As explained further at paragraph 25 of Parsons 2, the Scheme handled
complaints raised by postmasters and where mediation was successful, formal
settlement agreements were entered into. 12 of the Claimants are party to such a
settlement agreement with Post Office which is in full and final settlement, to
release any and all claims, whether or not presently known to the parties that they
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‘ever had against Post Office and/or any of its related parties in relation to their
respective complaints.
244.244. As part of the Network Transformation programme, postmasters were
provided with the option to:
244.4244.1___ (1) Convert their branch into a Main or Local branch. Ifa postmaster chose
this option, then their existing contract with Post Office would be terminated. In
addition to funding equipment and works to update the postmaster's branch, Post
Office made a payment, subject to conditions, to the postmaster to support their
transition to a Network Transformation Contract. The payment made to the
postmaster was in full and full and final settlement of any and all claims that the
operator had or may have against Post Office howsoever arising and whether
arising out of the termination of their existing contract and whether under common
law, contract, statute or otherwise._I provide an example of such a settlement at
LL. The postmaster agreed that this was reasonable as part of documentation they
signed: see [...] of the document I exhibit at [...]. From its records of those it made
such payments to, Post Office currently believes there are 60 Claimants who fall
within this category. The payments made to the Claimants differed depending on
the type of model the postmaster was converting to, but for Local branches the
payments made were up to £60,000.
244.2244.2 (2) Leave the Post Office network. If a postmaster chose this option then
they were invited to submit their resignation from their contract with Post Office. If
Post Office was able to appoint a new operator under a Network Transformation
Contract in the postmaster's area, then the postmaster's contract would be
terminated. Subject to conditions, Post Office then paid a discretionary-"Leaver's
Payment" to the postmaster. The conditional resignation pack that the postmaster
signed to submit their resignation included wording that the Leaver's Payment
would be paid in full and final settlement of all and any claims that the postmaster
had or may have against Post Office howsoever arising and, without limitation,
whether arising out of their resignation and the resulting termination of their contract
and any other associated contractual documents, the occupation of their premises
or otherwise and whether under common law, contract, tort, statute or otherwise.
The Leaver's Payment was typically in the region of £100,000 but could be up to
£200,000. From its records of those it paid Leaver's Payments to, Post Office
currently believes there are 43 Claimants who fall within this category.
242.246. To date, the Claimants have not particularised the-any fraud that Post
Office is_said to have committed which would invalidate these settlement
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agreements. Therefore, there are 115 Claimants who have already entered into
settlement agreements with Post Office and are at risk of being struck out. I would
suggest that it is remarkable that the Claimants have not considered it appropriate
to explain in detail how and why each of the affected Claimants considers himself
or herself still able to assert claims against Post Office despite these settlement
ayments, and it is deeply regrettable that Post Office is still facing unparticularised
tions of fraud in this r E
SECTION 5: OTHER ORDERS AND COSTS
243.246. The parties are largely agreed on the orders in relation to ADR and costs.
In light of the strike outs sought by Post Office, it also seeks corresponding orders
that the Claimants pay Post Office's costs in this regard.
244.247. I note that security for costs currently remains a live issue between the
parties and there is ongoing discussion with Freeths regarding whether and how
security should be given. Post Office is not raising the question of security at the
CMC but reserves its position to make a security application in the future if an
agreed resolution cannot be reached with the Claimants.
STATEMENT OF TRUTH
I believe that the facts stated in this witness statement are true,
Signed:
Date:
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