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Witness name: Simon Recaldin
Statement No.: WITN09890700
Dated: 4 September 2024
POST OFFICE HORIZON IT INQUIRY
SEVENTH WITNESS STATEMENT OF SIMON RECALDIN
1 I, Simon Recaldin, of 100 Wood Street, London, EXCV 7ER, will say as
follows:
INTRODUCTION
2 I am employed by Post Office Limited (“Post Office”), as the Director of
the Remediation Unit (“RU”) (previously also referred to as the Historical
Matters Unit ("HMU")). I have held this role since 10 January 2022. My role
includes managing the delivery of the Overturned Convictions redress
process (“the OC Process”), the Horizon Shortfall scheme (“HSS”), the
criminal appeals process and consequent civil liability and redress issues,
internal and external communications and oversight of all matters relating
to the Remediation schemes and payment of redress.
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3 Under my Directorship, the RU was established to centralise redress and
criminal appeals related work emerging from the outcomes of the Group
Litigation Order judgments including settlement. As RU Director, I chair the
Horizon Matters Committee ("HMC") which reports into the Remediation
Committee (“RC”) which is a sub-committee of the Post Office Board
(“Board”). The HMC and RC are responsible for the decision making of the
RU. I brief Post Office's Senior Executive Group (“SEG”) and Board on
matters considered by the RC. My line manager is the Post Office’s Interim
General Counsel for the Inquiry and RU.
4 I make this witness statement in response to a request dated 25 July 2024
for information pursuant to Rule 9 of the Inquiry Rules 2006 regarding the
OC Process. The Rule 9 requests a statement to address the following:
(a) Overview of the OC Process;
(b) Administration of the OC Process;
(c) Analysis of, and trends relating to, the operation of the OC Process
and actions taken to address any issues arising from them; and
(d) Conclusions as to the operation of the OC Process.
5 For the avoidance of doubt, the applicable data range is from the effective
starting date of the OC Process on 11 December 2020' to 31 May 2024 as
set out in the Rule 9 request.
141 December 2020 was the date the first six convictions were overturned by the Southwark Crown Court
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6 I will refer to the postmasters and postmistresses (“Postmasters”) in the
OC Process as Claimants throughout this statement.
7 Except where I indicate to the contrary, the facts and matters contained in
this witness statement are within my own knowledge. Where any
information is not within my personal knowledge, I have identified the
source of information or the basis for my belief. BSFf have assisted me in
the preparation of this witness statement.
THE OC PROCESS
Establishment of the OC Process
8 As the Inquiry is aware, following the Horizon Issues Judgment dated 16
December 2019, six appellants had their convictions overturned by the
Southwark Crown Court in December 2020. On 23 April 2021, a further 39
appellants had their convictions overturned by the Court of Appeal in
Hamilton & Others [2021] EWCA Crim 577. As a result of convictions being
overturned, both Post Office and Government wanted to create a
mechanism to ensure that those affected by these serious miscarriages of
justice could obtain fair redress outside of the judicial process. This was
the reason for establishing the OC Process.
9 The OC Process effectively started on 11 December 2020 being the date
on which the first six convictions were overturned. The most recent
Claimant entered the OC Process on 22 August 2024. This was the 111th
Claimant who successfully appealed their conviction. To assist the
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Claimants with the issue of limitation, Post Office has offered to enter into
standstill agreements with the majority of Claimants taking up that offer.
10 The OC Process is a remediation process and therefore, there was not a
date on which it officially opened. It started out as a negotiated process
akin to settling a dispute pre-litigation. Currently, it is best described as a
hybrid process with aspects of both a remediation scheme and a
negotiated process. The OC process also includes individuals who were
prosecuted but not convicted of offences connected to the Horizon IT
system (set out in more detail from paragraph 29 below).
11 From the date that the first convictions were overturned to July 2022, Post
Office received 11 pre-action letters from previously convicted Postmasters
seeking redress. In order to assist the Inquiry, Post Office has exhibited a
workflow of the OC Process (POL00448751).
12 Post Office sought funding from Government to be able to provide redress
to these Claimants. One funding agreement was made in July 2021 which
enabled Post Office to make interim payments of up to £100,000
(POL00448914). A second funding agreement was made in December
2021 (POL00448915) enabling Post Office to make full and final settlement
payments.
13 Setting up the OC Process was a collaborative process between Post
Office, Herbert Smith Freehills (“HSF”), Postmasters, Postmasters’ legal
representatives and Government. Together a process was established to
ensure that full and fair redress is provided as swiftly as possible. This
included seeking to agree principles for remediation to reach fair redress.
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From an early stage, Post Office recognised that there may be cases where
parties could not agree on redress. As a result, an independent
assessment panel (“IAP”) chaired by Sir Gary Hickinbottom (a former judge
of the Court of Appeal) (“Sir Gary”) was set up, to opine on the outcome of
any disputed pecuniary claims. If a case is referred to the IAP, it will provide
a non-binding determination (this process is explained further at paragraph
87 below).
Initial Engagement with Postmasters
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After the Court of Appeal handed down its judgment in Hamilton, Post
Office wrote to several hundred Postmasters (in tranches, by recorded
delivery) whose convictions were identified as potentially using Horizon
data and who had been the subject of a private prosecution by Post Office.
The Postmasters were informed that their conviction could be unsafe due
to it being wholly or partly based on Horizon data and as such, they may
wish to consider appealing their convictions. The letter (POL00448908)
was sent to each potentially affected Postmaster with up to three follow up
letters.
In response to these letters, Post Office received feedback from some
Postmasters that they were too traumatised to engage with Post Office
directly. Consequently, Post Office enlisted the help of the Criminal Cases
Review Commission (“CCRC”) to contact these individuals in place of Post
Office regarding the possibility of appealing their convictions. The CCRC
also wrote to the individuals who did not respond to the contact from Post
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Office. All such individuals were written to separately by the CCRC at least
once.
Post Office was not the only prosecutor of Horizon related cases and other
prosecuting authorities included the Department for Work and Pensions,
the Crown Prosecution Service (“CPS”), the Public Prosecution Service of
Northern Ireland and the Crown Office and Procurator Fiscal Service in
Scotland. Post Office engaged with these other prosecuting authorities to
explain the process it was adopting to contact Postmasters about
appealing their convictions and suggested they may wish to undertake a
similar process. The other prosecuting authorities adopted their own
processes, and some wrote out to the relevant Postmasters, resulting in
various levels of engagement.
To ascertain the details of the affected Postmasters, Post Office instructed
a credit reporting agency. For Postmasters who had not responded, a third
party was hired to carry out wider checks in an effort to trace affected
Postmasters. Further letters were sent to those Postmasters who could be
traced by this further process.
In response to the feedback from Postmasters and from the then BEIS
Select Committee, Post Office wanted an independent body to be available
for affected Postmasters to speak to about the possibility of appealing their
convictions. To achieve this, Post Office engaged Citizens Advice (“CA”)
(formerly known as the Citizens Advice Bureau) to specifically provide
support for Postmasters who were reluctant to engage with Post Office
directly and who wanted further information and support regarding
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appealing their convictions. In October 2022, the CA set up a bespoke desk
for Post Office victims and this contract remains in place to date and is
available for Postmasters to access.
Post Office noted that despite its efforts to contact potentially affected
Postmasters, the majority did not appeal their conviction.
In a further effort to prevent miscarriages of justice based on the use of
Horizon evidence being missed, Post Office instructed its external criminal
legal advisers to conduct a proactive review of the records held by Post
Office for each of the cases which had not yet been through the appeals
process. Independent counsel was instructed to review the cases and
apply the test set out by the Court of Appeal in Hamilton, to determine
whether or not the case could be considered to be a ‘Horizon case’. Of the
hundreds of cases reviewed; senior counsel identified 34 cases as ‘Horizon
cases’.
Following counsel's review, Post Office wrote to 32 of those individuals to
inform them that if they appealed against their conviction, Post Office would
concede the appeal. Since these letters were sent, ten of the individuals
have had their convictions overturned, eight applied to the CCRC and two
cases were before Southwark Crown Court. The remaining individuals will
no doubt be captured by the recent legislation.
There are approximately 25 people that Post Office has not been able to
contact due to not being able to locate an up-to-date address for them. Post
Office has tried to arrange visits to previous known addresses and have
run further address and credit checks in an attempt to locate these
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individuals. Post Office paused further searches and letters in
approximately mid-2023, at which point we provided details of the
Postmasters who had not responded or we could not locate, to the CCRC.
We understand that the CCRC has located three of those individuals but
Post Office does not have any further information in this regard.
How Post Office might best engage with Postmasters in order to raise their
awareness about and encourage them to appeal their convictions has been
regularly discussed and considered including at the RC and HMC. In an
effort to be proactive, Post Office has explored all proposals through these
fora and has taken these forward where possible, recognising that this can
be a difficult balancing exercise when respecting that some Postmasters
understandably do not feel able to engage with Post Office.
At the point at which the Post Office (Horizon System) Offences Act 2024
passed into law, Post Office believes that a total of 183 individuals had
applied to the courts to have their convictions overturned. 164 of these
concerned Post Office prosecutions. At the same point in time, Post Office
understands there were 32 live applications being considered by the
CCRC.
Of the Post Office prosecuted convictions, 65 convictions were not
overturned, 21 appeals were abandoned, 33 applications are understood
to have been rejected by the CCRC, six appeals were refused by a Single
Judge of the Court of Appeal Criminal Division (“CACD”) and five appeals
were dismissed by the Full Court and the convictions were upheld. In cases
where appeals to the Court were unsuccessful or applications were
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rejected by the CCRC, those appellants are not eligible for redress under
the OC Process given their convictions have not been overturned.
As Director of RU, I have made it my practice to ensure that I, or a
representative of mine, attends every court case where convictions are
overturned so that Post Office can apologise directly to the Postmaster for
the experiences they have suffered. Recognising that some Postmasters
might not want to engage with a Post Office representative immediately
after their conviction has been overturned, I approach the Postmaster’s
legal representative in the first instance to check that the Postmaster is
willing to speak with me. Understandably, sometimes Postmasters do not
want to take me up on this offer of an apology directly and in these
circumstances I convey my apologies via their legal representative. I have
attended the Court of Appeal in London as well as the equivalents in
Edinburgh and Belfast in order to convey my apologies in person to
Postmasters. It is an extremely humbling experience where the strength of
these Postmasters can only be admired.
As previously advised to the Inquiry, Claimants, and applicants to all other
Post Office and DBT redress schemes, have the opportunity to meet with
the Post Office CEO or another senior Post Office Executive, if they
consider it may be helpful to them. This enables individuals to recount the
experiences that they and their families have suffered and to receive a
sincere personal apology for all that they have endured. These are
understandably charged and emotional events but Post Office hopes they
help Claimants, even if in a small way. To date, I have attended all of these
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meetings. I am inspired by the strength and power of the Claimants I have
met and who have experienced such journeys. I am truly humbled by their
explanations of what they have been through.
Prosecuted but not convicted cohort (“PNC”)
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PNCs were included in the funding agreement provided by DBT on 20
December 2021 on the basis that Post Office’s liability does not end
because a Postmaster was not convicted (POL00448915). Post Office and
DBT agreed that in order for a PNC to be eligible for the OC Process, the
test to be applied would be: if a prosecution had resulted in a conviction,
would it have been deemed unsafe following the principles set out in
Hamilton? Post Office instructed its external criminal law legal advisers,
Peters & Peters (“P&P”) who in turn instructed external counsel, to make
this determination. For the purposes of the OC Process, the term
‘prosecution’ has been given a broad meaning as set out in case law. It can
cover the point at which an individual is charged to being found not guilty
at a Court hearing.
The OC Process therefore includes PNC claims by individuals (i) who were
prosecuted using Horizon evidence but were not convicted, (ii) who were
not claimants in the High Court Group Litigation Order case against the
Post Office brought by 555 postmasters exposed the Horizon IT scandal
(the “GLO”) and (iii) are non-Postmasters (as set out further below). GLO
claimants are remediated separately by DBT via the GLO Compensation
Scheme announced in March 2022.
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31 Under the HSS all Postmasters, including Postmasters who were
prosecuted but not convicted, were sent a letter by Post Office inviting them
to make an application to the HSS if they incurred a shortfall loss during
the relevant period which the Postmaster thought could have been caused
by the Horizon system. Post Office has received c.50 applications in the
HSS which sought redress as a result of Postmasters having been
prosecuted but not convicted. The HSS has a specific head of loss for
malicious prosecution which is available for PNC Postmasters to claim.
However, non-Postmasters for example, Post Office employees, branch
assistants employed by a Postmaster etc (who I will refer to as employees)
are not eligible for the HSS so cannot make a claim for redress under that
Scheme. That is why Government provided funding for PNC employees
under the OC Process, meaning they are eligible to apply to the OC
Process. This means that both the HSS and OC Process can include PNCs
depending on whether they are a Postmaster or an employee.
32 Through P&P, Post Office has tried to identify the individuals who might be
part of the PNC employee cohort. P&P has been unable to identify all
potentially eligible individuals? due to a lack of data and evidence relating
to those cases. Identifying PNC employees who might be eligible for
redress has proven to be very difficult. Accordingly, Post Office does not
have a complete record of PNC employees who may have cases for
malicious prosecution and may therefore be entitled to redress.
2 Being not only those individuals who were prosecuted but also those who were eligible for redress by determining
whether their prosecution resulted in conviction because Horizon evidence was essential and, if so, would it fall to be
quashed under Hamilton principles?
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Because of the difficulties identifying the PNC employee cohort, Post Office
has not sent letters relating to the OC Process to them. Without reliable
data to identify the potentially eligible individuals, Post Office is conscious
that writing to every individual who was prosecuted but not convicted during
this period could result in many ineligible people seeking advice from
lawyers and incurring legal fees unnecessarily. In addition, it may cause
confusion and upset to the individuals who may be ineligible for the OC
Process (as a result of not satisfying the Hamilton principles).
To date, Post Office is aware of eight PNC related Claimants who have
indicated their intention to seek to claim redress under the OC Process.
One of these claims has reached full and final settlement and the others
are at the eligibility stage where further information to confirm eligibility is
being sought by Post Office. However, in many cases Post Office has found
very few documents to disclose given the passage of time. To try and
overcome this, Post Office has approached P&P and the CPS to
understand what documentation/information is held and/or available to
assist potential Claimants with the eligibility assessment. To assist with this,
Post Office has also suggested to some Claimants that they approach the
relevant police station in order to obtain the necessary
documentation/information.
Public Interest only cases
35 There are five cases which were initially ineligible for an interim payment
in the OC Process notwithstanding the fact that their convictions had been
quashed. This was as a result of the DBT funding letter (POL00448914)
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dated July 2021 which contained a criterion that Public Interest only cases
were ineligible. ‘Public interest only’ cases arose where a Postmasters’
route of appeal was to the Crown Court and not the Court of Appeal
(Criminal Division). In these cases, Post Office, with the assistance of their
legal advisers, were required to apply the Full Code Test under the Code
for Crown Prosecutors. In Public Interest only cases, Post Office concluded
that the evidential element of the Full Code Test had been satisfied, but
due to various other factors, the public interest element had not been met
and therefore Post Office offered no evidence to oppose the appeal. In
short and as explained to Southwark Crown Court, Post Office considered
that there was sufficient evidence to provide a realistic prospect of
conviction in these cases (because the Horizon evidence was corroborated
by other non-Horizon related evidence in accordance with the Hamilton
Judgment). However, it was considered that it was not in the public interest
to have a re-trial given the age of the cases and the fact that the appellants
had already served their sentences.
In December 2022, Post Office participated in a mediation with three of the
public interest only Claimants. The mediation was partly successful in that
two of the three claims were fully settled using this process. Of the original
five, the other two Claimants did not have their convictions overturned until
September 2023.
In January 2024, the Government determined that public interest only
cases should in fact be eligible for the OC Process. As such, Post Office
wrote to the five public interest only individuals on 25 January 2024 to
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confirm they were eligible for redress under the OC Process and that for
those who had fully settled their claims via mediation, those settlement
monies would be considered by Post Office as interim payments. Post
Office invited those who had not yet submitted interim payment
applications to submit them and it subsequently made interim payments of
£163,000 to those who had not received at least this sum already (which
were subsequently topped up to £200,000). One Claimant decided to settle
for the Government's £600,000 upfront offer and this payment was made
on 27 February 2024. Post Office invited the other four Claimants to submit
their claims in the usual way. However, Post Office has not yet received
them.
Lifecycle of a claim
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There is no formal eligibility criteria, save for the requirement that the
Claimant must have either had their Horizon-related conviction overturned
or have been prosecuted for, but not convicted of, an offence where
Horizon evidence was essential to the prosecution. Individuals from each
of the jurisdictions within the United Kingdom are eligible to join the OC
Process, it is not limited to England and Wales.
When Post Office becomes aware of a conviction having been overturned,
it sends the Postmaster a letter of apology which is approved and signed
by Nick Read, CEO. This is followed by a further letter to the Claimant's
representative (when such details are received) summarising the OC
Process (POL00448913). This includes information relating to the
Government offer (described further below at paragraph 41), an application
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form for an interim payment (POL00448912), an overview of the claims
process (POL00448916) and a request for pre-prosecution shortfall
details. Claimants are invited to make a pecuniary (financial loss) and non-
pecuniary (intangible losses such as distress) claim. The provision of
information at this stage is tailored depending on whether the Claimant is
legally represented or not® and whether the solicitor’s firm is familiar with
the OC Process.
Following receipt from the Claimant of the documents requested, a further
letter is sent by Post Office on a ‘without prejudice’ basis. This letter
appends various documents which describe the OC Process in further
detail particularly in relation to pecuniary and non-pecuniary claims. The
documents appended to this letter include: the pecuniary principles (“the
Pecuniary Principles”), the Early Neutral Evaluation of Lord Dyson (dated
29 July 2022) (redacted for legal privilege) (“the Evaluation”), a template
claim for non-pecuniary damages (POL00448911) and the 17th edition of
the Judicial College Guidelines on Personal Injury Claims.
The Government offer is an upfront amount of £600,000 which is made
available to OC Claimants (with the exception of PNCs) to accept without
needing to submit a full claim to be assessed. This offer was announced
by DBT on 18 September 2023 (the “Government Offer’) and it went ‘live’
from that date although some of the precise mechanics of how it would
work were put in place thereafter. Claimants have an option to either accept
° Only one Claimant is not legally represented in the OC Process
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the Government Offer or to request a full assessment of their claim
(including pecuniary and/or non-pecuniary claims). If a Claimant elects for
a full assessment, they will no longer be eligible for the up-front payment,
even if their assessed claim is valued at less than £600,000.
The Claimant completes the relevant documents depending upon whether
they would like to apply for an interim payment, accept the £600,000
Government Offer or seek a full assessment of their claim (pecuniary
and/or non-pecuniary losses). In practice, the majority of Claimants will
apply for the interim payment in the first instance to afford them further time
to consider the Government Offer in more detail and/or with the assistance
of their legal representative. Only four Claimants have accepted the
Government Offer without first requesting an interim payment to afford
them further consideration time.
Where the Claimant is deceased, Post Office needs to ensure the
individual who is legally entitled to pursue the claim (as a representative of
the estate) is communicated with and will receive the redress. As such,
probate must have been completed before an offer can be made, which is
a lengthy third-party process. Regrettably, there are eight deceased
Claimants in the OC Process.
Where the Claimant is bankrupt, Post Office needs to communicate with
their Trustee in Bankruptcy to request that it waives any interest in the
redress being paid out. Post Office provides waiver forms for the Trustee
in Bankruptcy to complete in relation to all interim payments, non-pecuniary
settlements and full and final settlements. Communicating with third parties
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may create a slight delay in progressing the claim however, to mitigate
matters, Post Office proactively contacts the Claimant to see if there is
anything that they can assist with which may involve contacting the Trustee
in Bankruptcy directly and liaising with them if required, in order to progress
matters.
Post Office endeavours to update Claimants with any changes made to the
OC Process. For example, when the Pecuniary Principles were
established, Post Office wrote to all Claimant representatives to inform
them of the introduction of these principles.
Generally throughout the OC Process, Claimants are communicated with
via their legal representatives by telephone and email. Teams or in-person
meetings can be arranged if considered helpful. If Post Office does not
receive an acceptance of its offer of an Interim Payment or a response to
its Offer Letter in relation to either a pecuniary or non-pecuniary claim within
a reasonable timeframe, it will send a follow-up letter to the Claimant and/or
their legal representative which is followed up by a telephone call to the
legal representative.
Post Office will assess the non-pecuniary claims in accordance with the
Evaluation and the pecuniary claims in accordance with the Pecuniary
Principles with the objective of delivering redress which is full and fair in all
the circumstances. Following this, Post Office will make a without prejudice
offer of redress. If Post Office considers that the elements of the losses
claimed are not recoverable, it will explain why and, where appropriate,
request further information.
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In relation to the progress of claims, the aim is to make an offer to
Claimants within 40 working days from receipt of a_ sufficiently
particularised pecuniary claim (including a schedule of loss and evidence).
During those 40 days, the likelihood is that there will have been contact
with the Claimant to seek further information and/or clarification relating to
their claim.
In relation to non-pecuniary claims, Post Office aims to send offers within
28 days of receipt of the claim. Short delays to settlement of non-pecuniary
claims may occur in cases involving medical expert reports (such as
personal injury claims) as Post Office often receives expert reports which
are not compliant with Civil Procedure Rule (“CPR”) Part 35. Compliance
with Part 35 is a requirement of Government given Post Office does not
obtain its own separate expert report and typically will accept the findings
of the Claimant's expert providing the report is be CPR compliant (e.g.
contain a signed statement of truth). In cases where the expert report is not
CPR 35 compliant, Post Office requests that the report is rectified before
settlement is finalised and payment of redress is made.
If the Claimant accepts the offer made by Post Office, a settlement deed
will be drafted and agreed between the parties and once fully executed
payment will be made within 28 days although typically this is made within
seven working days. If the Claimant only agrees with some of the heads of
loss in the offer, acceptance can be made in respect of only those heads
of loss. In such instances, payment in respect of the agreed heads of loss
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will be made within 28 days of either a settlement deed being executed or
an offer letter being signed and returned by the Claimant.
If the Claimant does not wish to accept the offer, they are asked to set out
why they interpret the existing evidence differently and/or provide any
additional evidence in support of their position. Post Office will consider the
reasons put forward and any further information received and, if
appropriate, make a revised offer.
Independent Legal Advice
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Only one of the 111 Claimants is not legally represented. Post Office has
encouraged this Claimant to make a formal pecuniary and non-pecuniary
claim and provided a list of documents that other Claimants typically submit
with their claims to try to assist the preparation of this claim. Although a
formal claim has not yet been received, Post Office has assessed the
information it has available to it and made an interim payment to the
Claimant based upon this information, which has been accepted. Post
Office regularly contacts the Claimant's (non-legal) representative and is
aware that their representative participates in meetings with Sir Gary. We
have asked Sir Gary to support this Claimant and try to encourage them to
engage a legal representative so that we can progress their claim further.
Where a Claimant has not appointed a legal representative immediately
following their conviction being overturned, a senior member of the RU
legal team will usually call the Claimant to explain the application process
and suggest that they obtain legal advice. If a Claimant requires assistance
on a legal firm to instruct, Post Office can provide a list of legal
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representatives who have the requisite knowledge and experience of the
OC Process as a result of already being instructed in respect of it.
Post Office has sought to make the OC Process as user-friendly as
possible, however, given the unavoidable complexities in assessing
malicious prosecution damages, it will always recommend that a Claimant
seeks legal advice from the outset.
For Claimants who request a full assessment of their claim (where both the
pecuniary and non-pecuniary claims are assessed), Post Office will pay
reasonable legal costs. Legal costs are reviewed once the assessment has
been completed and an offer for legal fees will be made to the Claimant
following receipt of a schedule of costs. Although Post Office’s offers for
legal costs are usually accepted, there have been a number of cases in
which legal cost offers have not yet been accepted. Where legal costs are
disputed, the costs can be assessed by the IAP which has a costs
adjudicator. The IAP determination as to reasonable costs is final and
binding, albeit either party can request an oral hearing before the costs
adjudicator.
Since 18 September 2023, when the Government Offer was introduced,
Claimants who accept the up-front offer of £600,000 have been able to
claim a maximum of £20,000 (excluding VAT) for legal costs. For claims
that started before 18 September 2023, but which subsequently accept the
Government Offer, Claimants can claim reasonable legal costs from the
start of their claim up to 18 September 2023, and a maximum of £20,000
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(excluding VAT) from 18 September 2023 onwards. Expert fees (such as
accountants, medical experts) can be claimed in addition to these costs.
Application for Interim Payments and Top-up Payments
57
58
Once a Claimant's conviction has been overturned, where Post Office was
the prosecuting authority, Post Office seeks to make contact either directly
or via the Claimant's legal representative to provide details of the OC
Process. Once the details of the legal representative have been
ascertained, Post Office instructs HSF to write to them to provide a number
of documents including an Interim Payment application form
(POL00448912). To accept the Interim Payment, the Claimant needs to
complete a six-page application form and return it to HSF. The application
form requests personal information from the Claimant, such as their full
name, date of birth, address (and previous addresses), contact details,
their role, whether they would like to accept or are considering accepting
the Government Offer and details of any bankruptcy. This ensures that Post
Office receives all necessary information to make the Interim Payment,
such as obtaining a waiver from a Trustee in Bankruptcy if necessary.
Upon receipt of an application for an Interim Payment, Post Office will send
either an offer letter to the Claimant or a letter confirming that an Interim
Payment will not be offered (which has only been sent three times to date).
Post Office aims to send this letter to the Claimant within 28 days from
receipt of the application for an Interim Payment. To accept the offer of an
Interim Payment, the Claimant must sign the offer letter and return it to Post
Office. Post Office aims to pay the Interim Payment within the Service Level
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Agreements (“SLAs”) of (i) 28 days to make an offer following receipt of an
interim payment application; and (ii) 28 days to make an interim payment
following receipt of the acceptance of the offer for an interim payment
(although in practice it is often paid much quicker).
59 The Department for Business and Trade (“DBT”) confirmed on 22 July
2021 that it would fund interim payments of up to £100,000 for all eligible
OC Claimants. A Government approved interim payment process was set
up in August 2021.
60 The interim payment was increased to £163,000 in November 2022 as a
result of the ENE, as it was determined that this was the minimum amount
a Claimant would receive in redress.4 Consequently, top up interim
payments of £63,000 were offered to all Claimants who had received the
£100,000 interim payment but not provided Post Office with a non-
pecuniary claim by 1 December 2022. Where a non-pecuniary claim had
been submitted by 1 December 2022, Post Office completed a full
assessment of the claim rather than topping up the interim payment.
Acceptance of the Government Offer
61 On 18 September 2023, DBT announced the availability of the Government
Offer of £600,000 which would not require Claimants to have either their
non-pecuniary or pecuniary claims assessed.
“This was before the Government Offer was implemented
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Where a Claimant accepts this offer, the Claimant is required to enter into
a settlement deed and once signed, the payment will be made with any
previous interim payments being deducted from the £600,000. Post Office
aims to send offer letters and settlement deeds to the Claimant within one
week of receiving the Claimant's acceptance. Payment is typically made
within 7 to 10 working days from receiving the signed settlement deed.
Where a Claimant elects for a full assessment and submits either a
pecuniary or non-pecuniary claim, they will no longer be eligible for the
£600,000 Government Offer payment, even if the assessed claim is valued
at less than £600,000.
Post Office did not have any direct involvement in DBT’s decision in relation
to the Government Offer. Post Office was notified that DBT were
considering it and were asked to provide DBT’s working team with the
principles agreed for the assessment of pecuniary claims and information
regarding heads of loss.
Post Office encourages all Claimants, either in writing or by telephone, to
seek legal advice to assist them to consider whether to accept the
Government Offer and advise whether it is fair redress for that particular
Claimant. As set out at paragraph 56 above, these legal fees are covered
by Post Office.
As at 31 May 2024, the Government Offer has been accepted in 40 cases
and those claims have been fully settled. Following the announcement of
the Government offer, Post Office has received six separate pecuniary
claims up to 31 May 2024 and since then has received a further six
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pecuniary claims. When a pecuniary claim is submitted, Post Office now
issues a top-up interim payment to the Claimant of £450,000°, less any
interim payments already paid. Seven full and final settlements have been
completed through the full assessment route. Offers have been made in a
further three cases.
Application for Full Assessment of Claim
67
68
If the Claimant believes that their claim is worth more than £600,000 (the
Government Offer sum) then they may elect for a full assessment of their
claim by submitting a claim for their pecuniary and/or non-pecuniary losses.
The evaluation process involves a full review of the claim and all heads of
loss by Post Office using the criteria established for assessment of
pecuniary and non-pecuniary claims set out below. If more information is
required, it is requested from the Claimant and/or their legal
representatives.
Given the pecuniary principles are not exhaustive, if a new head of loss is
raised by a Claimant that Post Office has not previously considered in a
claim, Post Office will consider it further. This will need to go through a Post
Office and Government governance process which may include approval
of funding by Government if applicable. If a new head of loss is agreed, it
will be included in the Pecuniary Principles or added to the existing heads
of loss if non-pecuniary.
5 This top-up was introduced by Sir Gary to incentivise the bringing forward of more pecuniary claims.
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69 Once the evaluation has been completed, Post Office makes an offer of an
amount it considers to be full and fair redress. The offer letters are usually
very detailed. It sets out each head of loss and how Post Office has
calculated what it considers to be full and fair redress in respect of each
and Post Office encloses an Excel spreadsheet with its calculations to help
the Claimant understand how the offer has been calculated.
70 As an example of Post Office’s continuous learning, if during the evaluation
process Post Office considers that the Claimant might have a claim for a
head of loss that it has not expressly claimed, Post Office may note this
head of loss in the offer letter. Albeit, it is for the Claimants legal advisers
to advise them in this regard.
Non-Pecuniary Claims
71 To make a non-pecuniary claim, the Claimant would usually provide a
schedule or witness statement. The schedule will set out each head of loss
claimed with an explanation for each one, alongside any necessary
supporting documentation such as a medical report. Post Office now has a
template schedule that it provides to Claimants and/or their legal
representatives to assist them in preparing the claim at a very early stage
in the OC Process (POL00448911). Post Office hopes that having a
template will make producing a schedule easier and more efficient for the
Claimants.
72 The documentation provided (which may include a medical report, a victim
impact statement or a quantified claim) is reviewed. If required, further
information is requested from the Claimants’ legal representatives. The RU
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Legal team will prepare a report for the purposes of internal Post Office
governance which includes: an executive summary, HSF’s advice on the
sum claimed for non-pecuniary heads of loss, advice sought from Senior
Counsel with relevant personal injury expertise and an assurance report
from Post Office which confirms whether the facts as stated in the witness
statement are accurate and whether the medical expert report is Part 35
compliant. Internal Post Office Committees and Government will review
this report in order to approve the proposed settlement figure and a
settlement offer letter is sent to the Claimant.
73 In the ENE (discussed in more detail below), Lord Dyson considered six
heads of loss (which had been agreed between Post Office and Claimants’
legal representatives, Hudgell Solicitors) and evaluated a range of redress
that might be awarded for each head of loss. For exemplary damages, Lord
Dyson proposed a fixed sum of £75,000 to be paid to all Claimants to reflect
the level of wrongdoing committed by Post Office based on previous case
law and the estimates of the numbers of likely Claimants.
74 To assess non-pecuniary claims, Post Office considers the ranges of
redress set out in Lord Dyson’s ENE for each of the heads of loss claimed
and assesses, based on the facts of each individual case, where each
claim sits within those ranges. In considering each claim against Lord
Dyson’s ENE, Post Office endeavours to ensure consistency in its
approach in assessment of all non-pecuniary claims. The case is reviewed
by internal Post Office committees to approve the offer to be made. If a
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case is considered to be exceptional®, Post Office will send the proposed
offer to Government for its ratification before the offer is made to the
Claimant.
Between August 2022 and 30 April 2023, 53 non-pecuniary claims were
processed with all claims being settled via a formal settlement deed. As at
28 August 2024, 77 non-pecuniary claims have been fully settled (including
the Claimants who accepted the Government Offer without first lodging a
non-pecuniary claim) and nine non-pecuniary claims have yet to be fully
settled. Of those nine claims, eight have received offers of settlement in
relation to all heads of loss and one has received an offer of settlement in
respect of all heads of loss except personal injury.
Post Office understands that there are 25 non-pecuniary claims that have
not yet been submitted.
Pecuniary Claims
77
From the outset of the OC Process to the establishment of the Pecuniary
Principles in October 2023, pecuniary claims were dealt with by negotiated
settlements between the parties. As at 1 February 2023, eight pecuniary
claims had been received albeit they were progressed very slowly. Post
Office made requests for further information, waited for responses, entered
into negotiations to settle the claims, then required both internal and
Government approval of offers before they could be sent to the Claimant.
° For example, where new heads of loss are raised, where new principles are to be developed or where precedent
setting decisions are required
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This was a lengthy and time-consuming process which Post Office felt was
not an appropriate way to manage the claims. Instead, a more formal
structure for processing claims was required.
Throughout 2023, Post Office held a consultation with Claimants and their
legal representatives to establish a set of Pecuniary Principles’ to help
promote swift and fair settlements. Post Office invited all Claimant legal
representatives to comment on the draft principles, including an
opportunity to propose any additional principles. Following an extensive
feedback process and multiple iterations of the principles which was a
necessarily time-consuming process, the principles were finalised on 22
January 2024 and shared with all Claimant representatives on 5 February
2024.
There have been a small number of cases in which a loss is claimed which
is not included in the principles, for example gratuitous care. Where this
situation has arisen to date, Post Office has considered whether this loss
should be added to the principles and has made offers in relation to those
losses. These forms of loss must be escalated to DBT for ratification under
governance processes. Assessing pecuniary claims based upon these
principles assists Post Office in endeavouring to assess claims consistently
and ensures that before any offers are made against a new head of loss,
Government funding is available to pay the claim.
7 These cover 14 heads of loss and detail examples of evidence that may be useful for each and the basic legal
principles for each.
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To make a pecuniary claim, Claimants need to provide a schedule of loss
with supporting evidence such as tax records.
The first fully particularised pecuniary claim was received in or around
November 2021. During 2021 and following the Hamilton judgment,
Government were putting the requisite funding in place with the full and
final funding agreement being signed in December 2021 (POL00448915).
During 2022, a negotiated settlement approach was established and in
November 2022, Post Office started to engage with the Claimant's
representatives regarding the pecuniary principles. Engaging with the
Claimant's representatives and finalising pecuniary principles necessarily
took some time. By early 2023, Post Office had settled a number of non-
pecuniary claims but had only received eight pecuniary claims.
Post Office identified some heads of loss for which it already held
information on some Claimants, such as prosecution shortfalls, costs and
the Royal Mail Colleague Share Plan. Where Post Office already held
information about losses for Claimants and could ascertain how much that
Claimant would be entitled to, it made offers to Claimants to pay those
losses whilst awaiting the fully particularised claims. In so doing, Post
Office sent 91 offer letters for these heads of loss to 68 Claimants as a
result of no pecuniary claims being made.
Offers can be made for an individual head of loss, multiple heads of loss or
a full claim.
Usually, within 1 to 2 weeks of receipt of a pecuniary claim, Post Office
meets with DBT and HSF to review the claim and consider whether any
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further information is required. A timetable is also set for the claim. If further
information is requested, Post Office will send a Request for Further
Information (“RFI”) to the Claimant's legal representative. If a response is
not forthcoming, the claim will be progressed and the offer letter will
highlight the fact a response to the RFI was not received.
Post Office, or the Claimant, may require expert advice to be obtained, for
example, for loss of earnings claims, where assistance may be needed
from an accountant. If expert advice is required, Post Office pays
reasonable costs for the expert to be instructed. Where the Claimant has
requested expert advice be obtained, the Claimant can nominate an expert
to be instructed. Depending on the costs of the expert, approval for funding
of the same is required from Post Office’s governance and it may be the
case that I have the necessary delegated authority to approve this.
As of 28 August 2024, all Claimants except three have received a payment
in some form, whether an interim payment or final settlement payment.
These three Claimants had their convictions overturned between late
January and August 2024. All three have been sent an interim payment
application form with one Claimant accepting the interim payment; this
interim payment was made on 2 September 2024.
Independent Assessment Panel
87 If, following without prejudice discussions, Post Office and the Claimant are
unable to reach an agreement, on either the whole or parts of a pecuniary
claim, either party may refer an issue in dispute to the IAP. This is an
opportunity for a third party to independently (and on a without prejudice
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basis) assess the claim and recommend a level of redress in respect of
any heads of loss or legal costs’ claims which are not agreed.
The documentation provided to the Claimant at the outset of the process
(as set out in paragraphs 39 and 40 above) informs the Claimant that they
are able to refer issues relating to pecuniary claims® to the IAP using the
referral application form (POL00448909). If requested, HSF will explain the
documents to the legal representatives and go through these in detail with
them.
The IAP consists of a three-person panel of individuals with financial, retail
and legal expertise, chaired by Sir Gary. Sir Gary was nominated by the
Claimant solicitors jointly? following which Post Office formally engaged
him. The Claimants were also invited to nominate the other two panellists
although no names were forthcoming therefore, the individuals suggested
by Post Office were approved.
The IAP follows the Pecuniary Principles and the procedure for
independent assessment is governed by the IAP’s Terms of Reference
(POL00448910). These set out the following steps which should take place
when a party requests an independent assessment:
(a) Notify the panel and the other party in writing of the proposed
referral and set out the heads of loss to be referred.
® Where referrals are required for non-pecuniary matters, these are referred to Lord Dyson. To date, there have been no
such referrals
° Hudgell Solicitors were the only legal representatives who wanted to engage in this process. Post Office invited all
Claimants and their legal representatives to engage.
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(b) Share a summary of their position on the disputed issues with the
independent assessor and other party. This should include relevant
supporting documents. In addition, a standard application form has
been prepared which will require completing.
(c) The responding party should, within ten days, share a similar
summary setting out their position.
Upon receipt of the summaries, Sir Gary or his delegate will consider the
issues and determine whether the claim will be considered by Sir Gary as
a single panel member or whether Sir Gary requires the expertise of either
or both of the other two panel members.
The IAP can ask the parties to provide further information, convene a short
hearing or appoint any experts considered necessary. Throughout the
procedure, the IAP will keep in mind the overriding objective of achieving
swift and fair resolutions at proportionate cost.
Whilst the independent assessment is not binding, it is anticipated that the
guidance provided will assist the parties in reaching agreement as to the
disputed heads of loss. The IAP’s recommendation will be supported by
short written reasons and be shared with both parties at the same time.
In the event the parties are still unable to reach agreement, the Claimant
retains the right to proceed to litigation in respect of any remaining issues
of dispute.
Some legal representatives have referred OC Process related matters
such as legal costs to Sir Gary in order that he can opine on them and offer
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an independent view. However, a request for an independent assessment
of a disputed head of loss has not been referred to Sir Gary to date.
It is too soon to say whether the IAP provides sufficient means of resolving
disputes fairly without the need for Claimants to resort to civil proceedings:
the IAP has not yet had much opportunity to improve the efficiency and/or
fairness of the OC Process given no referrals over disputed heads of loss
have been made. Nevertheless, the role of Sir Gary has been helpful in
moving cases forward and liaising with legal representatives (who are
willing to engage with him) to keep cases progressing through the OC
Process. Sir Gary has direct meetings with the Claimants and/or their legal
representatives which are attended by HSF on Post Office’s behalf.
Post Office would have expected to receive more referrals as matters
progressed through the OC Process. However, as a result of the
Government Offer, fewer claims will require a full pecuniary assessment
through the OC Process therefore, fewer referrals to the IAP.
There was a delay in establishing the challenge mechanism and IAP as a
result of the essential requirement to set up a process that had clear
pecuniary principles. It took time for these to be considered with the
Claimant representatives before determining the escalation route. Post
Office sought the Claimant representatives’ input on the adjudicator to be
appointed and Sir Gary was nominated as the Claimants’ preferred
candidate. Following this, there were practical delays in appointing Sir Gary
and the two other specialist panel members due to procurement
considerations and data protection / data sharing issues.
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The availability of the IAP, even though no formal recommendations have
been made yet, has improved the efficiency and fairness of the process
because of its independence: it is a mechanism by which Claimants can
escalate disputes if necessary and Sir Gary has assisted with progressing
claims.
Early Neutral Evaluation
100
101
102
In early 2022, Post Office, Government and a number of the Claimants’
legal representatives were having difficulty agreeing what monetary value
should be considered fair redress in respect of non-pecuniary claims. The
difficulty stemmed from the scale of the Post Office’s prosecutions which
fell to be set aside by the courts and there not being a previous precedent
example to follow. Therefore, an external, independent view was required
on the issue.
Post Office liaised with Hudgell Solicitors (the legal representative of the
majority of the Claimants) to choose a suitable evaluator and provided a
list of possible candidates, including Lord Dyson. Following consideration
of the list, Hudgell Solicitors selected Lord Dyson to be appointed. It was
agreed with Hudgell Solicitors that a formal ENE hearing would take place
on 18 July 2022. The parties were Post Office and 10 Claimants all of whom
were represented by Hudgell Solicitors.
Post Office invited other legal representatives to participate and, although
some expressed interest, ultimately no other parties took part. Post Office
and Hudgell Solicitors agreed the Terms of Reference and the Heads of
Loss for Lord Dyson to consider. It was agreed between Post Office and
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Hudgell Solicitors that ten of Hudgell Solicitors’ claims would be evaluated
covering a range of fact patterns. This would enable the parties to obtain a
range of evaluations for different issues that could then be applied across
all other cases.
103 Hudgell Solicitors provided Lord Dyson with a witness statement and
schedule of loss for each claim together with evidence (there was a medical
report for all ten claims). Both Hudgell Solicitors and Post Office put forward
legal submissions in relation to how much should be awarded for each
head of loss and attended a hearing before Lord Dyson on 18 July 2022 at
which he heard oral submissions from Tim Moloney KC on behalf of
Hudgell Solicitors and Jonathan Kinnear KC on behalf of Post Office.
104 Lord Dyson’s Evaluation was produced on 29 July 2022 which sets out the
ranges of redress for various heads of loss for Postmasters with overturned
convictions and the appropriate award for exemplary damages. The
Evaluation was accepted by the parties which allowed for the Claimants’
non-pecuniary losses to be settled in fairly short order; six out of the ten
Claimants settled their claim with Post Office almost immediately.
105 The Evaluation unlocked the difficult issue of the appropriate monetary
ranges for non-pecuniary damages including exemplary damages which
enabled the bulk of Claimants to present their non-pecuniary claims to the
OC Process. Consequently, between August 2022 and mid-2023,
Claimants’ representatives were focused on settling non-pecuniary claims
with Post Office pursuant to the terms of the Evaluation.
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106 The Evaluation presented Post Office with an opportunity to seek further
funding from Government to raise the initial £100,000 interim payment to
£163,000 as this, according to Lord Dyson, was the lowest sum a formerly
convicted Claimant could expect to receive for their non-pecuniary
damages. Post Office topped up all Claimants who had not settled their
non-pecuniary claims by 1 December 2022 to £163,000. This resulted in
26 Claimants (who had returned their signed offer letters) receiving a
further top up payment of £63,000 in or around December 2022. Two
Claimants had not returned their signed offer letters therefore, upon receipt
of the same in July 2023, those two Claimants were paid the top up
payment of £63,000. There were five Claimants who presented their non-
pecuniary claims in December 2022 however, their legal representatives
confirmed they would not settle these claims until a preliminary issue was
resolved. These Claimants did not agree that the monies they received
from the 2019 GLO settlement ought to be deducted from the redress
received in the OC Process. Post Office suggested to these Claimants that
the issue could be moved to the pecuniary stage of the claims in order that
the non-pecuniary claims could be settled, but this was not accepted.
107 A further Early Neutral Evaluation took place before Lord Dyson in
December 2023 to resolve this issue and the Evaluation was published on
8 December 2023. Lord Dyson confirmed that the GLO monies would not
fall to be deducted from the overall OC Process redress as they were
collateral in nature, or in effect gifts from the non-convicted GLO population
to the convicted GLO population. Lord Dyson did not agree that the GLO
monies were paid to the convicted population by Post Office but rather the
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GLO monies were paid by the non-convicted population notwithstanding
that the ultimate source of the monies was Post Office. In cases where
GLO monies had been deducted from the OC Process redress, it was
refunded by Post Office pursuant to Lord Dyson’s Evaluation.
108 If an offer for a non-pecuniary claim is not agreed by the Claimant, Post
Office will offer to submit the case to Lord Dyson to carry out an
independent review and opine on what a reasonable offer would be. Post
Office has offered to refer three cases to Lord Dyson but none have
accepted this offer so far (despite Post Office following up with the
Claimants’ legal representatives multiple times). These three Claimants
have been paid Post Office’s full non-pecuniary offer as an interim payment
and Post Office await contact from the legal representatives to progress
any outstanding claim amounts.
109 Post Office considers that the ENE has improved the fairness of the
process by providing a consistent framework against which the claims can
be assessed and claims have been settled as a result of it. The availability
of the IAP, even though no formal recommendations have been made yet,
has improved the efficiency and fairness of the process because of its
independence: it is a mechanism by which Claimants can escalate disputes
if necessary and Sir Gary has assisted with progressing claims.
Tax Obligations
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Following the introduction by the Government of legislation’®, the OC
process is tax exempt for individuals who are resident in the United
Kingdom. This includes income tax, inheritance tax and capital gains tax.
There are at least two Claimants in the OC Process who live outside of the
jurisdiction. The tax exemption does not apply to these claims. Post Office
is working with Government to find a way forward in these two claims.
These exceptions will require a new governance process to be put in place
which may cause a delay in finalising these claims and making the final
settlement payment.
Bankrupt Claimants
112
113
114
For Post Office to process payments to bankrupt Claimants, it requires
waivers from the Claimant's Trustee in Bankruptcy. These have been freely
given in most cases by the Official Receiver. However, three of the ten
Claimants’ (who participated in the ENE) non-pecuniary settlements were
delayed because of a dispute with their trustee in bankruptcy who refused
to sign the required waiver.
Claimants can make a claim for any losses that they suffered as a result of
being made bankrupt as part of their pecuniary and non-pecuniary claims
(there is a head of loss to cover these claims).
Claims for redress under the Government's Horizon Conviction Redress
Scheme (“HCRS") will be dealt with by DBT not Post Office. As such, Post
* The Post Office Horizon and Infected Blood Interim Compensation Payment Schemes (Tax Exemption and Relief)
Regulations 2023 which came into force on 16 March 2023
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Office has been collaborative with lessons learnt (for example, sharing the
pecuniary principles with government to inform HCRS principles).
ADMINISTRATION OF THE PROCESS
115 The OC Process is run and governed by Post Office, specifically, the RU,
HMC, the RC and Government. I attend the following meetings which are
intended to provide oversight, each of which has a defined purpose and
important functional role in the governance and delivery of the OC Process:
(a)
(b)
(c)
(d)
(e)
I attend monthly monitoring meetings with DBT to formally oversee
the OC Process, discuss performance and any outstanding matters,
risks and issues.
I am requested to attend the Horizon Redress Programme Board
meetings which are run by DBT which oversees all redress schemes
across Post Office and DBT.
I chair the weekly Horizon Committee meetings. This is the
governance forum which represents the RU and which oversees the
OC Process.
There is a sub-committee of the HMC which I chair called the OC
sub-committee. This sub-committee considers and approves interim
payment applications and pecuniary and non-pecuniary claim offers
in the OC Process cases and meets on a weekly basis.
I attend the monthly, previously fortnightly, RC meetings which are
chaired by Brian Gaunt (previously chaired by Ben Tidswell). The
RC is a sub-committee of Board and is responsible for considering
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and making decisions/approving recommendations made by the
HMC in respect of matters relating to the OC Process or making
recommendations to the Board as required.
(f) I regularly attend weekly SEG meetings. Once a month, I have a
standard appointment at a SEG meeting to provide written and
verbal updates and answer any questions.
(g) I regularly attend Post Office Board meetings. For each meeting, I
provide written and verbal updates.
(h) I am regularly invited to attend the Post Office Risk and Compliance
Committee and on occasion, the Audit, Risk and Compliance
Committee.
116 To assist me with managing the delivery and governance of the OC
Process, I have a team of seven individuals who report directly to me.
However, not all of these are involved in the OC Process. In the main, I
have one-to-one meetings with two colleagues from the RU team who
manage the OC Process.
117 _HSF is instructed by Post Office in the OC Process and all communications
go via them. However, Post Office has responsibility for management and
oversight of the OC Process.
118 Government is heavily involved in the OC Process including ratifying
decisions made by the RC. The first 20 non-pecuniary claims following the
Evaluation were reviewed and ratified by Government. Following this,
exceptional case criteria were developed so that now the majority of non-
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pecuniary claims do not need to be formally ratified by DBT before an offer
can be made.
119 All processes and decisions are approved by DBT except those that have
been formally delegated to Post Office, such as straightforward decisions
in relation to interim payments, Government Offers and non-pecuniary
claims that are not deemed exceptional. Decisions for delegated matters
are made by the RC and ratified by DBT. Approval is not released until such
ratification has been obtained.
120 The are no KPIs to measure the performance of the OC Process instead,
turnaround times are monitored. The OC Process adheres to the GLO
Scheme target: for non-pecuniary claims, Post Office endeavours to make
an offer within 28 days from receipt of a sufficiently particularised claim and
for pecuniary claims, in 90% of cases a first offer should be made within 40
working days form receipt of a sufficiently particularised claim.
121 The Inquiry specifically requested that Post Office sets out any oversight of
the OC Process by the Horizon Compensation Advisory Board (“HCAB’).
There is no direct oversight from the HCAB over Post Office in respect of
the OC Process however, HCAB does advise DBT ministers in respect of
their oversight of the OC Process and liaise with Sir Gary and will be kept
informed via those channels.
ANALYSIS AND TRENDS
Processing times
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122 The Inquiry has requested that Post Office provide data in relation to the
operation of the Scheme as follows:
(a) The average length of time between submitting an application and
being considered for eligibility is not strictly subject to Post Office’s
determination. Eligibility’! is determined by the Horizon related
conviction being overturned by the Courts. The only exception to
this was in relation to the public interest only claims (detailed in
paragraph 35 above). However, following the HMG policy decision
dated January 2024, this is no longer a consideration for eligibility
(as detailed at paragraph 37 above).
(b) I The average length of time between submitting an interim payment
application and payment of an interim payment is 34 working days,
based on the 99 initial interim payments that have been made to 31
May 2024. This excludes the three former public interest claims
where settlement payments were reattributed to Interim Payments
following the HMG policy decision (as set out in paragraph 37
above).
(c) The average length of time from receipt of Government Offer
requests to redress payment is 20 working days, based on the 40
Government Offers accepted to 31 May 2024. This average includes
both Post Office and third-party handling times such as (i) Post
1 As per the term used in the Rule 9 request
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124
125
126
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Office/DBT Governance approvals and preparation of a settlement
deed; and (ii) Claimant solicitor(s) review/acceptance.
Following the ENE, over 90% of non-pecuniary claims submitted were
settled and paid within 44 working days of application submission.
Non-pecuniary claims
It takes an average of 50 working days to make a redress payment from
the submission of a non-pecuniary claim based on the 59 non-pecuniary
offers accepted to date. This average includes both Post Office and third-
party handling times such as (i) Claimant solicitor responses to requests
for further information; and (ii) Claimant representative confirmation of the
Official Receiver’s waiver (where previous bankruptcy applies).
The average payment time for the nine non-pecuniary claims subject to
previous bankruptcy proceedings is 85 working days, compared to an
average of 44 working days for the other 50 non-pecuniary settled claims.
The average days are taken from receipt of a sufficiently particularised
claim to the first offer made.
Pecuniary claims
Based on the four fully assessed claims settled to 31 May 2024, it takes an
average of 305 working days from first submission of a pecuniary claim to
redress payment. This timeframe includes both Post Office and third -party
handling times, such as:
(i) Post Office/DBT Governance approvals;
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(ii) Liaising with Trustee in Bankruptcy or Probate; and
(iii) I Claimant representative responses to requests for further
information.
127 Since the start of 2024, following the completion of the Pecuniary Principles
consultation with Claimant representatives, Post Office aims to make a first
offer within 40 working days of a Full Claim (being claims which Post Office
considers, with advice from its legal advisors, do not need any further
evidence in order to assess every element of the claim) (as set out at
paragraph 41 above).
128 Post Office acknowledges that in relation to pecuniary claims the OC
Process was too slow and uncertain for too long. Claims were substantively
delayed whilst principles were in the process of being finalised and
concessions requested by Claimant representatives went through Post
Office/DBT governance approvals. The turnaround time for new pecuniary
claims has improved significantly in 2024 and Full Claims (which do not
include novel heads of loss) are being processed in around 40 working
days.
Trends relating to delays
129 The Inquiry has requested that Post Office set out any trends relating to
delays in processing applications. These are set out below:
(a) Initially, there were delays in receipt of non-pecuniary claims as it
was very difficult for the parties to reach agreement on the level of
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redress to be paid. However, these were significantly improved by
the ENE in July 2022.
(b) As set out above in paragraph 81, there have been delays in
receiving fully particularised pecuniary claims. Some of these delays
appear to have been resolved by Post Office proactively undertaking
a review of certain heads of loss for which it already held information
for the relevant Claimants and making offers in respect of those
heads of loss only (whilst awaiting further information on the heads
of loss for which no information was held by Post Office). These
delays were also resolved by establishing the Pecuniary Principles
in consultation with the Claimants’ legal representatives and due to
the assistance from Sir Gary in his oversight of the pecuniary
process.
Referrals to the Independent Panel
130 The Inquiry has sought the numbers and proportion of cases referred to
the IAP and any trends in the types of cases referred to the IAP. The Inquiry
has also requested that Post Office address whether referral to the IAP has
resulted in an improvement of offers to Claimants. As stated above at
paragraph 96, no disputes on substantive claims or heads of loss (as
opposed to ancillary costs matters) have been referred to the IAP for an
independent assessment to date. Accordingly, the IAP has not assessed
the level of any offers so we are not in a position to identify any trends in
the types of cases referred.
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131 Although not a part of the independent assessment process, a schedule
showing the status of all live pecuniary claims was reported to Sir Gary
previously on a monthly, and now a quarterly, basis. This provides Sir Gary
with an oversight of offers made, what Post Office or the Claimant
representatives are waiting for and any issues that are causing delays.
Claims are then discussed between the legal representatives and Sir Gary
in regular meetings he holds with them every few months or as issues arise.
Post Office does not attend these meetings but can provide Sir Gary with
updates on particularly complex cases ahead of these meetings so that he
can relay this information and try to assist in progressing claims. These
meetings help to keep individual Claimants informed about the progress of
their claim. Any recommendations made by Sir Gary during these meetings
are provided to Post Office for consideration and implementation. In some
more complex cases, Sir Gary has helped Post Office prepare a timetable
for progressing the claim.
Impact of Legal Advice
132 Due to only one Claimant not having legal representation, there is an
insufficient pool to compare their experience against the represented
claimants so as to provide any reliable analysis on the impact of legal
advice on the claims, including in respect of time taken to process claims
and the level of pay out. Furthermore, neither a non-pecuniary claim nor a
fully particularised claim has been received from this individual therefore,
there is no data to analyse.
Complaints
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133. The Inquiry has requested that Post Office summarise the types of
complaints (if any) received about the process. These include:
(a)
Complaints from legal representatives regarding difficulties with
evidential standards which were created by Post Office’s
wrongdoing. The issue concerned the extent of requests for further
information and challenges in obtaining historic evidence. In
response, Post Office proposed a set of mutually agreed evidential
standards be drafted in order to particularise a claim. However, this
proved to be more challenging than anticipated due to a divergence
of positions between the parties as to what losses should be
considered “self-evident” against those requiring an evidential basis.
Consequently, Post Office set out in the pecuniary principles that
Claimants should undertake a search for documents to assist in the
presentation of their claims. In the event this is not possible, there is
provision for Claimants to submit witness evidence in place of
documentary evidence.
Complaints from legal representatives relating to the disclosure of
relevant documents. Due to the time which has passed since Post
Office prosecutions were pursued, the content and volume of
available Post Office records which could potentially support a
redress claim, is extremely variable and ranges from a small number
of documents to thousands. Sufficient evidence may be unavailable
to evidence a submitted or potential claim, leading to complaints of
obfuscation by Post Office. In the latter scenario, the time required
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to review content, assess for materiality regards redress claims and,
subsequently, redact non-disclosable information, is significant.
Previously this has resulted in complaints about Disclosure
extended timelines. To date, the team may not have been sufficiently
resourced to manage this level of disclosure, but now there is a
greater level of resource to manage disclosure.
CONCLUSIONS
134 Post Office considers that the OC Process is now running efficiently and
that claims are resolved in a reasonable timeframe. However, it
acknowledges that this was not the case from the outset of the OC Process
and apologises accordingly.
135 Post Office considers that the ENE of July 2022 was critical in overcoming
the difficulties resolving non-pecuniary claims and has greatly assisted with
the efficient, consistent and fair settlements of those claims.
136 Post Office acknowledges that whilst Pecuniary Principles were too long in
the making, their introduction has significantly improved the processing
times of the pecuniary claims. Additionally, the principles have assisted with
consistency and fairness of offers made. The fact no disputes regarding
pecuniary claims have yet been referred to the IAP suggests this is the
case.
137 Whilst the IAP has not had to deal with any substantive referrals as yet, Sir
Gary's involvement appears to be improving the process generally in turn,
improving efficiency. Post Office considers that the availability of an
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independent mechanism for disputes to be resolved in both the IAP for
pecuniary claims and use of ENE for non-pecuniary claims has improved
the fairness of the OC Process.
138 Post Office considers that Claimants have been supported and encouraged
to secure legal advice and adequate legal funding has been made
available. In addition, Post Office has taken appropriate steps to engage
with Postmasters that may be eligible to apply to the OC Process, as set
out in detail above.
139 Overall, Post Office considers that the OC Process is now set up to deliver,
and is delivering, full and fair redress.
Statement of Truth
I believe the content of this statement to be true.
Dated: 4 September 2024
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Index of Exhibits to the seventh witness statement of Simon Recaldin on
behalf of Post Office Limited in response to Rule 9 Request 59
Number I Inquiry URN
Document Description
Control/Production
Number
1. POL00448751
Workflow of OC Process
POL-BSFF-126-
0000001
2. POL00448914
DBT Funding Agreement July 2021
POL-BSFF-136-
0000007
3. POL00448915
DBT Funding Agreement December
2021
POL-BSFF-136-
0000008
4. POL00448908
Letter to all potentially affected
Postmasters
POL-BSFF-136-
0000001
5. POL00448913
Letter to Claimant representative
summarising the OC Process
POL-BSFF-136-
0000006
6. POL00448912
Application form for Interim Payment
POL-BSFF-136-
0000005
7. POL00448916
Overview of the claims process
POL-BSFF-136-
0000009
8. POL00448911
Template claim for non-pecuniary
damages
POL-BSFF-136-
0000004
9. POL00448909
IAP Referral application form
POL-BSFF-136-
0000002
10. POL00448910
IAP’s Terms of Reference
POL-BSFF-136-
0000003
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