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The Post Office has issued an apology to subpostmasters for the way some of them have been treated as it agreed to pay £57.75m in damages to settle a long-running legal battle over a faulty computer system.
This comes after days of mediation, which followed the Court of Appeal’s rejection of a Post Office request to appeal a damning judgement from the first High Court trial in the group litigation.
The plight of some subpostmasters was first reported in May 2009, when Computer Weekly revealed that the lives of some of them had been turned upside down after being fined, sacked, made bankrupt or even imprisoned because of unexplained accounting shortfalls. They blamed the Horizon accounting and retail system for the problems, which the Post Office rejects (see timeline of Computer Weekly articles below).
Brought by more than 500 subpostmasters against the Post Office, the group litigation has already cost tens of millions of pounds.
A joint statement from the claimants and the Post Office said: “The Parties to the Group Litigation in Bates v Post Office are pleased to report that they have reached a comprehensive resolution to their long-running litigation in the High Court, following several days of respectful, challenging and ultimately successful mediation during which the parties engaged with each other in good faith.”
The Post Office thanked claimants for holding it to account “in circumstances where, in the past, we have fallen short, and we apologise to those affected”. It said it is applying the lessons it has learnt form the case and will make changes to how it works with subpostmasters.
Tim Parker, Post Office chairman, said: “We are grateful to the claimants for taking part in this mediation and agreeing a settlement, bringing the Group Litigation to a close.
“We accept that, in the past, we got things wrong in our dealings with a number of postmasters and we look forward to moving ahead now, with our new CEO currently leading a major overhaul of our engagement and relationship with postmasters.”
Alan Bates, the former subpostmaster who has been challenging the Post Office over the Horizon issues for almost 20 years, said: “The Steering Committee would like to thank Nick Read, the new CEO of Post Office, for his leadership, engagement and determination in helping to reach a settlement of this long-running dispute.
“During the mediation, it became clear that he intends to reset the relationship between the Post Office and its subpostmasters and put in place new processes and support for them, as part of a wider programme of improvements.”
"It would seem that from the positive discussions with Post Office’s new CEO, Nick Read, there is a genuine desire to move on from these legacy issues and learn lessons from the past."
It is now more than a decade since Computer Weekly first published an article about the controversy. But it was as early as 2004 that Bates, previously subpostmaster in Craig-y-Don, Wales, first contacted Computer Weekly with his concerns that the computer system could be the cause of unexplained accounting errors in Post Office branches.
But even that first contact came some years after Bates had alerted the Post Office to potential problems at the end of 2000. He first wrote to his area manager about the issue in December 2000, when he raised a number of queries about Horizon. In 2003 he set up a website, www.postofficevictims.org.uk, seeking to find subpostmasters with similar problems.
In his letter to Computer Weekly in 2004, Bates wrote: “We have lost our investment and livelihood by daring to raise questions over a computer system we had thrust upon us…”
From the start, Bates identified the contractual relationship between the Post Office and subpostmasters as a major problem. Bates’s 2004 letter continued: “The core of our problem stems from our refusal to blindly accept liability for figures derived from the system without having full access to the system to check the data we have entered. As a subpostmaster, I was an agent and not an employee of the Post Office and the system was brought in a couple of years after the contract was signed with them.”
In that letter, Bates made clear that he would not back down. “I fully expect it to take a number of years to bring Post Office Ltd to account for what they have done to us, but we are determined to do it,” he wrote.
Mark Baker from the Communications Workers Union (CWU), who has campaigned for the claimants, said: “I am delighted that they have reached an agreement. We are waiting for the details with interest.”
“This is a massive vindication of all the work Alan Bates has done over 20 years,” he added. “Heads must roll in the Post Office and the CWU will be pushing forward with greater intensity to get the Post Office to sit down with the union to develop solutions to ensure this never happens again.”
Conservative peer James Arbuthnot has supported supostmaster claimants since he was MP for Hampshire North East, when a subpostmaster in his former constituency was threatened with jail for accounting irregularities that could not be explained.
“I’m thankful to hear that mediation has finally been successful,” he said. “We couldn’t go on as we were, with many millions of pounds being squandered on fighting about something that should have been resolved much earlier.
“We will all need to consider the detail of the results of the mediation to see what remains unresolved. I do hope we are not (as has been all too usual in this saga) inhibited by gagging clauses.
“Where does this leave, for example, the consideration by the Criminal Cases Review Commission? How does it leave those who have been convicted of, or who were persuaded to plead guilty on the basis of incomplete or misleading evidence to, crimes such as false accounting or even fraud? How are those sub-postmasters who are not parties to the litigation affected? I shall look forward to the answers to these and many more questions as details begin to emerge,” added Arbuthnot.
- May 2009: Bankruptcy, prosecution and disrupted livelihoods – postmasters tell their story.
- September 2009: Postmasters form action group after accounts shortfall.
- November 2009: Post Office theft case deferred over IT questions.
- February 2011: Post Office faces legal action over alleged accounting system failures.
- October 2011: 85 subpostmasters seek legal support in claims against Post Office computer system.
- June 2012: Post Office launches external review of system at centre of legal disputes.
- January 2013: Post Office admits Horizon system needs more investigation.
- January 2013: Post Office announces amnesty for Horizon evidence.
- January 2013: Post Office wants to get to bottom of IT system allegations.
- June 2013: Investigation into Post Office accounting system to drill down on strongest cases.
- July 2013: Post Office Horizon system investigation reveals concerns.
- October 2013: End in sight for subpostmaster claims against Post Office’s Horizon accounting system.
- October 2013: Former Lord Justice of Appeal Hooper joins Post Office Horizon investigation.
- November 2013: 150 subpostmasters file claims over ‘faulty’ Horizon accounting system.
- September 2014: Fresh questions raised over Post Office IT system’s role in fraud cases.
- December 2014: MPs blast Post Office over IT system investigation and remove backing.
- December 2014: Why MPs lost faith in the Post Office’s IT investigation, but vowed to fight on.
- December 2014: MPs to debate subpostmaster IT injustice claims.
- December 2014: MP accuses Post Office of acting “duplicitously” in IT investigation.
- January 2015: MPs force inquiry into Post Office subpostmaster mediation scheme.
- January 2015: Post Office faces grilling by MPs over Horizon accounting system.
- February 2015: Post Office CIO will talk to any subpostmaster about IT problems, promises CEO.
- March 2015: Post Office ends working group for IT system investigation day before potentially damaging report.
- March 2015: MPs seek reassurance over Post Office mediation scheme.
- March 2015: Retiring MP aims to uncover truth of alleged Post Office computer system problems.
- April 2015: Post Office failed to investigate account shortfalls before legal action, report claims.
- April 2015: Criminal Courts Review Commission set to review subpostmasters’ claims of wrongful prosecution.
- May 2015: IT system related to subpostmaster prosecutions under review by CCRC.
- June 2015: Post Office looking to replace controversial Horizon system with IBM, says MP.
- July 2015: Campaigners call for independent inquiry into Post Office Horizon IT system dispute.
- October 2015: James Arbuthnot takes Post Office IT fight to House of Lords.
- November 2015: The union that represents Post Office subpostmasters has warned of a problem with the Horizon accounting system.
- November 2015: An email from Post Office IT support reveals a problem with the Horizon system and supporting processes that could lead to accounting errors.
- November 2015: Group litigation against Post Office being prepared in Horizon dispute.
- February 2016: Post Office faces group litigation over Horizon IT as subpostmasters fund class action.
- June 2016: Post Office chairman Tim Parker says there would be “considerable risk” associated with changing its Horizon computer system.
- November 2016: The legal team hired by a group of subpostmasters will take their case to the next stage.
- January 2017: The group action against the Post Office that alleges subpostmasters have been wrongly punished for accounting errors gets a green light from the High Court of Justice.
- March 2017: 1,000 subpostmasters apply to join IT-related group litigation against Post Office.
- April 2017: Investigation into claims of miscarriages of justice in relation to a Post Office accounting system has appointed a forensic accountant firm.
- May 2017: Hundreds of subpostmasters have applied to join IT-related legal action since March.
- July 2017: Post Office defence in computer system legal case due this week.
- August 2017: Campaigners submit initial evidence in group litigation against Post Office over controversial Horizon IT system.
- October 2017: Subpostmasters’ group action against the Post Office reaches an important milestone.
- November 2017: An end is in sight for subpostmasters’ campaign against alleged wrongful prosecution, which they blame on a faulty computer system.
- November 2017: The High Court judge managing the subpostmasters versus Post Office legal case over an allegedly faulty computer system tells legal teams to cooperate.
- January 2018: Forensic investigation into Post Office IT system at centre of legal case nears completion.
- April 2018: Criminal Cases Review Commission forensic examination of the IT system at the centre of a legal case against the Post Office has raised further questions.
- May 2018: Post Office branches unable to connect to Horizon computer system for several hours after morning opening time.
- October 2018: After over a decade of controversy, next week marks the beginning of a court battle between subpostmasters and the Post Office.
- November 2018: Case against Post Office in relation to allegedly faulty computer system begins in High Court.
- November 2018: High Court case in which subpostmasters are suing the Post Office has revealed a known problem with a computer system at the core of the dispute.
- November 2018: A High Court trial, where subpostmasters are suing the Post Office for damages caused by an allegedly faulty IT system, ends second week.
- November 2018: Post Office director admits to Horizon errors and not sharing details with subpostmaster network.
- November 2018: The High Court trial in which subpostmasters are suing the Post Office has reached an important stage.
- December 2018: CCRC may hold off subpostmaster decision until after Post Office Horizon trial.
- December 2018: Court case where subpostmasters are suing the Post Office set to span at least four trials and extend into 2020.
- January 2019: Subpostmasters’ campaign group attacks Post Office CEO Paula Vennells’ New Year honour amid ongoing court case.
- January 2019: Thousands of known errors on controversial Post Office computer system to be revealed.
- March 2019: Tech under spotlight at High Court in second subpostmasters versus Post Office trial.
- March 2019: Post Office considered Horizon IT system “high risk”, court told.
- March 2019: CCRC watching Post Office Horizon trial closely.
- March 2019: Judge rules that Post Office showed “oppressive behaviour” in response to claimants accused of accounting errors they blamed on Horizon IT system.
- March 2019: Post Office ‘lacked humanity’ in the treatment of subpostmasters, says peer.
- March 2019: A High Court judge heard that the Post Office did not investigate a computer system error that could cause losses, despite being offered evidence.
- March 2019: The Post Office legal team in the case brought by more than 500 subpostmasters has called for the judge to be recused after questioning his impartiality.
- March 2019: A senior civil servant asked the Post Office to repay public money it had wrongly allocated to paying legal costs.
- April 2019: Subpostmaster claimants’ legal team makes application for the Post Office to pay millions of pounds of costs associated with trial.
- April 2019: Post Office to appeal judgment from first Horizon trial.
- April 2019: The Post Office’s claim that the judge overseeing the case concerning its controversial Horizon IT system was biased has been dismissed – but will now be considered by the Court of Appeal.
- April 2019: MP questions government over Post Office Horizon case.
- April 2019: Government says no conflict of interest in trial despite Post Office chairman’s dual role.
- May 2019: The Court of Appeal has refused the Post Office’s application to appeal a major decision in the Horizon IT trial.
- May 2019: The Post Office has applied for permission to appeal judgments from the first trial in its IT-related legal battle with subpostmasters.
- May 2019: The judge in the Post Office Horizon trial has ordered the organisation to pay the legal costs of its courtroom adversaries, and refused to give permission to appeal a major judgment.
- June 2019: Post Office asks Court of Appeal for permission to appeal judgment in first Horizon trial.
- July 2019: The Post Office has admitted that some subpostmasters are at risk of accounts not balancing due to an error it does not understand.
- July 2019: Problem revealed during High Court trial left subpostmaster with £18,000 surplus after IT system failed to register full amount of cash scanned in.
- August 2019: Subpostmasters suffering slow running and frozen terminals while Post Office searches for a fix to issues apparently caused by a software update.
- August 2019: The Post Office has fixed the latest problems with its Horizon system, affecting hundreds of branches.
- October 2019: A High Court judgment for a trial that focused on the Post Office’s IT system at the centre of a multimillion-pound litigation will be announced early next month.
- November 2019: The Court of Appeal has rejected a Post Office application to appeal judgments made in the its multimillion-pound battle with subpostmasters over IT system failures.
- November 2019: Peer calls for clear-out of Post Office board after Court of Appeal confirms major court defeat.
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