WITN10370151
WITN10370151
o
Post off fe
aga
INITIAL COMPLAINT
AND MEDIATION
SCHEME: THE WAY
FORWARD
Summary of options and
issues as presented by legal
advisers.
WITN10370151
WITN10370151
Summary of options and issues identified within Linklater’s paper:
Preliminary note on the future of the Mediation Scheme — dated 31 March 2014
Key Issues arising:
Contitiaiveg wheter
. the-extent. i which the Horizon system is fit for purpose
* Fundamental to establishing extent of legal liability and in shaping overall response. n
Coeante of tasalving complainte amet israes abot Henzon
* The extent to which the mediation scheme in its current form is fit-fer-purpese: ot mest ee oll strketeldsrs,
te Te eahsfochn~
* Structured process and framework based on key principles
« Role and remit of Working Group
* Role and remit of Second Vision! S. ant
The nature and extent of the risks arising from and associated with the Scheme in its current roe?)
Four key risks have been identified, and these are summarised in the table below:
Lukel U7 targe of
I Issues arising
Risks identified
Financial liability arising from * Iflegal liability exists a financial élaim-ia settlement may be + Review claim s ai ainst framework and
claippsetiement agreed during mediation< > a’ identify these with potential liability
: Freqeeneyiand value of Successful claims soneeae to be * Apply average value to determine
low. Memioe © estimated liability
+ Ex-gratia payments could be offered to expedite resolution of I ° [Use mediation process to resolve claims
claims regardless of legal position. where no liability through ex-gratia
ayments 7 TE D 3
+ I Value of ex-gratia paymentto be agreed
and payment considered in context of
PR and reputational risks of prolonged
process I TE py
PA STRICTLY CONFIDENTIAL 2 PAY
‘© PA Knowledge Limited 2014
WITN10370151
WITN10370151
Summary of options and issues identified within Linklater’s paper:
Preliminary note on the future of the Mediation Scheme — dated 31 March 2014
ieidereied
Mitigation / approach to q
costs * Agree rules to establish eligibility for
contribution towards costs
Cost of administering the scheme I +
incurred by
* up to £1,500 plus VAT for claim investigation
* up to £750 plus VAT for a half day mediation
‘ i £1,250 plus VAT for a full day mediation
+ A¥ability estimated at £415k(lus v4TI
* Costs‘incurred by Second Sight in region of £500k to date * Agree terms of reference
* No agreed contract or terms of reference ¢ Clarify role and responsibilities
* No pattern of instruction or direction for their work * Agree QA and approval process in
¢ Risk of increased costs without achievement of terms of contract to support payment of
desired outcomes fees :
Matemn\bor + Risk of dispute where quality of work under.question © East patent /reasorabuyr>
° Lack of clarity in respect of role and rem resulting in of ee eae’ ol peelings :
a lack of impartiality has Dress ben all
PR and reputational risk + Establishment of sche: Sets expectations of &settlement. . I - Clarity around process
associated with non-settlement * Views expressed publi by Second Sight and other Pirereual’ 6 Transparency in relation to decision
stakeholders, often with little evidence to support position, making
raises expectations of applicants. * Consistency of approach
* Low risk ofitigation if RSMR not satisfied with outcome of
mediation’ - scale of ci will drive decision making in this
regard: . :
* Low eof cess See J ioe baal niragp leant SPMEs,
PR and reputational risk « ‘fhe reaction of stakeholdersdo the payment of compensation * Clarity around process
associated with settlement to SPMRS where there is no legal liability to do s' * Transparency in relation to decision
. athe effects of such payments on the criminal colic making
secured to date and sought in the futur * Consistency of approach
* These risks are potentially more significant than non-
settlement. a)
PA STRICTLY CONFIDENTIAL I: q
OPA Knowledge Limited 2014 Yo @ ft ( nts 3 [PAJ
WITN10370151
WITN10370151
Summary of options and issues identified within Linklatef’s paper:
Preliminary note on the future of the Mediation Scheme — -dated 31 March 2014
The Way Forward:
The paper has identified a number of Isuee-which whon-broughtogetnerform-alongist of optons for the future operation of the
SCHEME, eer wiek gp F ere not reustaabley erelyue,
The following suggestions are made with reference to 0 restructuring the current scheme as constituted:
Clarifying eligibility under the scheme forelehhasts Subject to criminal convictions or civil judgements: Dea Latin ad Yl \ <iphost
aay
Ns Establishing independent view of Horizon system and whether it is fit for purposé. ge. oe nek yee.
+ Retablsing crtoriotof ayent of “standard” compensation irrespective of the le legal merit of their cainés )
* Revising role and responsibilities and governance fe} king Group. hl anny
war fim yy,
It is recommended that the Board consider whieh~of the « above options to take forward as part of #restructured scheme.
\__The role of Second Si Ce astderiny The prasity ark Poluhel sox neprant riches of
The paper has identified a number of issues in relation to the appointment of Second Sight, and the effectiveness of their involvement in
the scheme to date. Two options are considered:
* Terminate appointment > arch whee ne csse— ak osseS , it The scope of
howe of their sppenmen) avo testing Hair aggtecd ancl conclusiet se
It is proposed that Second Sight’s role in supporting
* Formalising snd revising
restructured scheme be considered as part of the options appraisal.
Operation of the scheme
There may be concern over the way in which the scheme has been operated and whether applicants have been treated “fairly”. Whatever
the perception, this is unlikely to lead to any obligation to pay compensation. Considering making payments to applicants for this reason
may further exacerbate the, issues the Post Office presently faces.
Lye “
PA STRICTLY CONFIDENTIAL 4 4
©PA Knowledge Limited 2014
WITN10370151
WITN10370151
Summary of options and issues identified within Linklater’s paper:
Preliminary note on the future of the Mediation Scheme — dated 31 March 2014
What is “fair” is difficult to define in a legal (or any) context. It could mean no more than 1) treating all applicants consistently 2) assessing
all complaints by references to the same, objective criteria 3) giving all applicants a chance to be heard (i.e. by openly inviting applications
to the scheme) 4) not taking unexpected steps which would benefit the wider body of SPMRs if only they had known to apply (e.g. ex
gratia payments) and 5) instituting the scheme itself. The Post Office has voluntarily entered into it and not given any binding assurances
as to its outcome or how it would be conducted. The scheme would seem to have satisfied most or all of these criteria.
Clarification of Desired Objectives wrowlesl He Port Office eae plate o-
The paper also sets out eaiément i carly in respect of desired objectives for the Scheme, in particular: lake ent
+ \e-there-a.desire td fimit the costs incurred in running the scheme? haw, eff) Monts &
. Ce tone ut, ierity: public reputation, relations with HMG and MPs #r 4 ongoing relationships with all SPMRs?
« Does the Post Office wish to take a more or less conciliatory approach in dealing with applicants?
+/ In providing redress to Applicants, does the Post Office wish:
/
/ * to compensate all applicants in accordance with their claim regardless of the nature of their complaint, simply to “make the
L problem go away” 7
Whet ti to compensate all applicants on a more limited basis by reference to objective criteria?
tie yelwkve: not to provide monetary compensation at all and seek to address SPMRs’ concerns in other ways, such as by way of apology,
ivPortaner additional training, upgraded hardware etc.?
of: * to take a harder line and not provide redress of any kind?
* Does the Post Office wish to get to the bottom of the alleged “problems” with Horizon or only to the extent necessary to satisfactorily
resolve the complaints in the Scheme?
Sf “
¢ Is there a view that there will always be a proportion of PSMRs dissatisfied with Horizon and any replacement for it, and therefore little
point in taking a holistic approach to resolving issues with Horizon or seeking fully to satisfy all applicants ipthis-cass?
The options appraisal will seek to ensure that any recommended option provides best fit against desired objectives. The
Board’s position in respect of the above should be sought as a matter of priority.
PA STRICTLY CONFIDENTIAL 5 (Pay
© PA Knowledge Limited 2014
WITN10370151
WITN10370151
Summary of options and issues identified within Linklaters paper:
Preliminary note on the future of the Mediation Scheme — dated 31 March 2014 .
Potential Options for Appraisal Counmssa. “bit fe re refit on bhraow I ot eltenstre Adak
Basedon the foregoing, t ng options should be presented to be Board for consideration: \ ie
Maintain current position (base case for appraisal) NL C8,
Close scheme and offer a9 allem ohne ; ; . »
Restructure scheme terminating Second Sight's involvement ; Sh, pevsing releef wer tang Geo tnelacls pessioili -
Restructure scheme formalising and revising the tang of Senond Sight's appointment Foemalis : [reve we of weer ies
(pte for Appraisal eles pasrGiltly oF» hie dsrube vselchs aschsintinny im vik, Wie poser,
i
RON >=
eport will be produced which will describe each option, outlining the pros and cons and risks of each.
A scoring matrix will be developed which will enable each option to be scored in relation to alignment with scheme objectives, estimated
financial exposure and ease of implementation. A weighting will be agreed to reflect the relative importance of mera
The outcome of the appraisal will form the basis of the recommended way forward for the Scheme to th ard.
Alignment with I Estimated _
I Option Description _ Scheme Financial
‘ Objectives I «Expos
Maintain current position
(base case for appraisal)
Close scheme
Restructure scheme —
terminating Second Sight’s
involvement
Restructure scheme —
formalising and revising the
terms of Second Sight's
appointment.
PA STRICTLY CONFIDENTIAL 6 PAJ
‘© PA Knowledge Limited 2014