Kickstarter link - please help fund this site

Tuesday, November 13, 2018

Day 4 write-up: Naushad Abdulla and Liz Stockdale are cross-examined


Naushad Abdulla - Lead Claimant 4
It's unfair to compare and contrast the two Lead Claimants who were cross-examined in court today. They are two individuals who do not deserve to be lumped together, simply because they happened to be in the witness box on the fourth day of this trial, but it's almost impossible not to.

There is a pattern to their experiences and a pattern to the way they were cross-examined, but they brought wildly different styles to the witness box, even though the story they were telling was essentially the same.

It was actually a reminder that this is about individuals, fallible human beings with ambitions and hopes and fears. And when I say that, I'm talking about both the claimants and Post Office staff.

First up was Naushad Abdulla, a former Subpostmaster in Charlton, South East London. Mr Abdulla took over his branch in Jan 2007 and was sacked ("summarily terminated" in his words) after an audit in May 2009 found a discrepancy of £4398.42 in his branch. Naushad was accused in court today of the criminal offence of false accounting. It is a charge he vehemently denies.

Naushad's peroration from the witness box today was one of the most unintentionally epic performances I have ever witnessed. And I say that with  respect to him, to the QC questioning him (the extremely capable David Cavender) and the judge who had to referee it.

The lead claimants preceding Mr Abdulla were Alan Bates, Pam Stubbs and Mohammad Sabir. Each was, of course, their own person, but they all seemed to have an awareness of the way in which the theatre of their appearance in court would play out. A QC asks you questions, you answer them to the best of your ability, and everyone bows down to the mechanics of the legal process.

Not so Mr Abdulla. He was neither arrogant nor disrespectful. He didn't seem to come to court to prove anyone or anybody wrong or right. He just had a natural ability to test, and to talk. If you, a QC, in an important trial, are going to ask Mr Abdulla a question, he's going to want to know why you asked him that question and he's going to probe and explore your reasoning, just as much as you are going to want to probe his. Mr Abdulla isn't trying to get one over on you, he just wants to fully understand where you're coming from before he feels he can give you a full and proper answer.

To witness this was a privilege. QCs ask very precise questions in which there is inference and import to be understood from each particular answer. Those questions hang heavy with legal meaning, which perhaps might not be apparent to the witness, and the witness is required to answer them as they understand them to be asked. 

Mr Abdulla did answer those questions, but he seemed to have a very natural ability to take control of the situation through a mixture of natural charisma and a predilection for warming to his theme. What I liked about him best was that he treated everyone in court as his equal, and expected the same in return.

The joy of it was watching the judge keep things moving in his courtroom so expertly. He read Mr Abdulla very well, gave him his moment when he thought it merited it, but respectfully brought him to heel when necessary. It was something of a masterclass. 

If you haven't seen the live tweets of Mr Abdulla's morning session - I would urge you to read them here.

Some of the exchanges do have an element of entertainment value to them, but only to the disinterested observer. In fact we were in court, or more particularly, the judge was in court to get a clear understanding of the truth of what had happened to Mr Abdulla around a decade ago.

To Mr Abdulla, it was deadly serious. We were talking about a traumatic period when he went from being a sales rep to a Postmaster to a suspect in the space of three years. Mr Abdulla says that time took his confidence away completely. He is currently between jobs.

The Post Office's QC started his cross-examination in the way he had with other lead claimants. He used his forensic skills to make clear to the judge just how much awareness Mr Abdulla must have had with regards to the contractual nature of the relationship he was entering into. Mr Abdulla, like many other Subpostmasters, was insistent he never saw the full 144-page Subpostmaster contract.

Mr Cavender spent a large part of the morning explaining to him how he must have.

This is a tactic which Mr Cavender has deployed with all the former Subpostmasters who have taken the stand so far. It is clearly crucial to the Post Office's case that they demonstrate to the judge that all the Subpostmasters who say they never saw a contract are either lying or mistaken. Otherwise it's difficult to explain how or why Mr Cavender would spend so many hours (and it is, by my estimation, at least five hours now) asking the judge to infer from the available evidence that, in fact, they did.

Of course, the simple thing to do would be for the Post Office to produce their copies of the signed 144-page Subpostmaster contract from each claimant. They have not indicated that they have these in their possession. Nor have they indicated that they don't. 

Mr Abdulla said he definitely would have taken legal advice if he'd ever been given a full Subpostmaster contract and told the court that if he had been given it there's no way he would have signed it - he would have had to be mad. "No one would. There'd be no agents left!"

Other highlights include Mr Abdulla being asked to confirm that he did sign a summary of various terms within the contract, during which he looked at the document on the screen in front of him in the witness box and pointed out that alongside this there was a section of legalese which said nothing in the document can "be relied on for any purpose".  The Post Office QC was really uninterested in that bit.

The cross-examination finished with a lengthy discussion about what Mr Abdulla's intentions were about what was in his safe when he was audited and suspended - an inflated damaged notes total and a personal, undated, uncashed cheque for £2,500.

Mr Abdulla was warned that Mr Cavender's questioning would be on the subject of false accounting, a criminal offence, and that he was entitled not to answer any question put to him if he felt it might incriminate him. Mr Abdulla was vehement and adamant. He would do exactly the same thing again because he felt he was doing the right thing.
Liz Stockdale - Lead Claimant 5
Next up was Liz Stockdale, a former clothes shop manager turned Subpostmaster, who took over the Sandsacre Post Office in Bridlington East Yorkshire in 2014 and was subsequently sacked in 2016, with the Post Office demanding she give them £28,222.52

Ms Stockdale was a quieter witness than Mr Abdulla, and an interesting case in that her story is not an old one. Her journey from successful person to Postmaster to criminal suspect has happened relatively recently. You can read my tweeting of her session in the witness box here. It's after Mr Abdulla finishes his evidence, further down the thread.

As Mr Cavender QC started treading the well-worn path about the sight of the documents Ms Stockdale would have had and signed, and what she understood by them (incidentally, she says she didn't see a Subpostmaster contract either) I got distracted and started reading her witness statement, which had just been released to me.

Ms Stockdale had problems with Horizon from the off. She could not understand where her supposed shortfalls were coming from:

"On 15 October 2014, unexplained shortfalls of £3,640.52 were showing on my Branch accounts. I called the Helpline whose unhelpful advice on this I set out above at paragraph 97.1.

"I called the Helpline again on or around 21 October 2014 and again asked for some further training and assistance from Post Office in relation to the balancing problems I was having. David Longbottom [a Post Office manager] came into my Branch on 29 October 2014 to try and work out what was going on. I let him see all of the Horizon records that I had access to. He printed off various documents from the system but he was unable to find out what the cause of those shortfalls was. He said that the problem would be referred to the Horizon Technical Desk, but I never heard any further from Post Office on this. Instead, I had a letter from Post Office on 3 November 2014 demanding payment of £3,640.52, being “the amount you owe to Post Office Ltd."

"I went back-and-forth with Post Office over this and eventually I agreed for Post Office to make deductions of £455 per month from my pay for a period of 8 months to cover the payment that they demanded, Post Office wanted me to do this, and said that I was not allowed to settle any further losses for a period of a year after this has been repaid. I took this to mean I was not allowed to settle further unexplained losses centrally at the end of a trading period. I felt that I had no choice but to agree. I did not understand the causes of these shortfalls and I was still hopeful someone from Post Office would get to the bottom of it. I believe David Longbottom attended the Branch again on 18 November 2014. Although I do not recall the details of this visit I am clear that David Longbottom still did not help me resolve the balance issues I was experiencing.

"While I do not remember the date of his visit, I recall a Post Office employee called Gary also visited my Branch in response to the problems I was having with unexplained shortfalls.

Gary apparently worked for Post Office and ran three Post Office branches of his own. He was unable to get to the bottom of where the discrepancies were coming from, and his parting advice was simply to “sack all your staff".

"In response to what had happened, I introduced a robust paper recording system for all cash movement in my Branch. I required all staff to complete manual till and safe logs which kept track of all cash in the till and safes, what had been paid in or paid out and even the denominations. I refer to some examples of this at [ES1/964-980]. This allowed me to manually reconcile cash in and cash out so that I could always check that the cash position in my branch accounts would be right and that nothing was incorrectly entered.

"I also had CCTV installed in the Branch. I trusted the staff and did not believe that they would take any money, but I wanted to be able to have a tight control of all cash in and out and to be able to completely rule out theft from a third party as a reason for the shortfalls. With CCTV and a robust paper recording system in place, I spent hours trying to investigate the reasons behind the shortfalls. In particular, whenever I encountered a shortfall, Darren and I sat down and reviewed the transaction log for that day against the paper recording system. However, we simply could not get to the bottom of why unexplained shortfalls happened - as far as I was concerned, everything should have been adding up."

This is the "unhelpful" advice from the helpline, by the way:

"I generally found the Helpline was dismissive of the problems that I was having. On one occasion, in October 2014, I remember reporting an unexplained shortfall of more than £3,000, which is a lot of money. I remember very clearly that the Helpline operator I spoke to said to me, "what’s the problem, its only £3,000, that’s a drop in the ocean compared to some people’s problems". This I remember because earlier on in the period of my appointment I had been told by the Helpline that I was the only one experiencing these problems, which had made me feel inadequate."

And as so many people have done before, Ms Stockdale stops trusting Horizon. She preferred to trust her paper system. When she did put her numbers into Horizon, it threw up an £18K deficit. She was audited. The auditor's investigation concluded "false accounting has taken place." She is now in serious trouble.

Mr Cavender, for the Post Office, quizzes Ms Stockdale intently about this. He makes a point which has slowly been crystallising over the last few days - if Horizon throws up a discrepancy which the Subpostmaster disagrees with, they can settle it centrally on Horizon and then dispute it. And, for some reason, says Mr Cavender, Mr Abdulla, Ms Stockdale and Mr Sabir did not do this.

This argument has been raging for years. Aggrieved Subpostmasters say that by settling centrally they are taking responsibility for a debt they are disputing if the Post Office decides it is not at fault. They say in reality, by settling centrally, they are delaying the inevitable. The inevitable being the Post Office deciding it is not at fault and making the pre-accepted debt theirs. The only other option is settling to cash, which means putting the money into the till in order to balance the account and roll over into the next period.

Yet in the stark light of a courtroom, a Subpostmaster's motives for not settling centrally and following a formal dispute process are difficult for them to explain. The accusation of artificially inflating cash balances, even less so.

Mr Cavender had no doubt. There was no problem in either of today's witnesses' Post Offices with Horizon. The discrepancies were entirely due to either or both their own dishonesty/mistakes or that of their staff. Furthermore Ms Stockdale's exchange with the helpline was a fiction, and Mr Abdulla had impugned his entire credibility to such a degree that the Post Office would be asking Mr Justice Fraser to disregard his evidence entirely.

Both Mr Abdulla and Ms Stockdale made articulate and unrehearsed arguments for their innocence, and their firmly-held belief that Horizon was the source of their problems.

The trial, as they say, continues...

... at 10.30am at Court 26 at the Rolls Building, off Fetter Lane, in London, tomorrow. I'll be there. Tweeting.

Day 4 - Naushad Abdulla's witness statement

Unformatted as yet:

Claimants
Name of witness: N Abdulla
No. of statement: 1st
No. of exhibits: NA1
Date: August 2018
THE POST OFFICE GROUP LITIGATION
Claim Numbers: HQ16X01238, HQ17X02637 & HQ17X04248
IN THE HIGH COURT OF JUSTICE
QUEEN’S BENCH DIVISION
BETWEEN:
ALAN BATES & OTHERS
-and-
POST OFFICE LIMITED
Claimants
Defendant
WITNESS STATEMENT OF NAUSHAD ABDULLA
I, Naushad Abdulla of
will say as follows:
1. I was Subpostmaster of the Charlton Post Office branch, located at 10-12 Charlton
Church Lane, London, SE7 7AF, between 24 January 2007, and 8 May 2009, when
my appointment was summarily terminated.
2. Since then, I have held various positions in management and sales, but am not
currently employed.
3. I am Claimant number 3, and a Lead Claimant for the purposes of the Common Issues
trial, and make this Witness Statement in relation to the Common Issues as defined
in Schedule 1 of the First CMC Order.
4. The matters stated within this statement are true to the best of my knowledge and
belief. Unless otherwise stated, the facts contained in this witness statement are
within my own knowledge and are true. Where they are not within my own knowledge
they are derived from the sources to which I refer and are true to the best of my
knowledge and belief.
i
C1/4/1
5. Exhibited to this statement is a paginated bundle of documents marked NA1.
References in this witness statement in the form [NAI/number] are to pages of that
exhibit.
A. BACKGROUND
6. I worked as a medical sales representative from 2000 up to my appointment as
Subpostmaster of the Charlton branch. From 2000 to 2002 my employer was Ventiv
Health, and from 2002 to 2006 it was Innovex Limited.
7. As a medical sales representative I was familiar with using basic sales and marketing
software to record sales meetings and actions, and I was also familiar with common
computer programs such as word and excel. I didn’t use a point of sale system or
accounting system, or any other computerised system of the scale and nature of the
Horizon system.
8. In 2006 I was interested in purchasing a Post Office branch and beginning a new
career venture because my employment as a medical sales representative was not
stable, I had previously been made redundant with very little notice, and there was
talk of this possibly happening again. I didn’t want to go through this again, and
wanted something more secure.
9. I perceived Post Office to be a reliable, trustworthy, national institution - a contrast to
the pharmaceutical industry in terms of stability and the way it dealt with people. My
parents had run a Post Office branch during the early to mid-1990s, and had been
very successful. They ultimately sold it because the travel from home to branch was
too far for them, but I was aware that they had been able to generate a good income
and to realise the investments they had made in the business over the years. So far
as I was aware, my parents had not had any particular problems in their dealings with
Post Office over the years.
10. I believed that by being appointed as a Subpostmaster and purchasing a Post Office
branch, I would be making for myself a stable career with a secure income. I was
aware that as a Subpostmaster I would be self-employed. I considered the position of
Subpostmaster to be a very secure position and a long term commitment.
11. I looked to purchase a branch that was local to my home, and recall reviewing
purchase and other financial information in relation to both Charlton and Denton
branches. My preferred branch was Charlton, because it was closer to my home, and
2
C1/4/2
the remuneration was better. This was the branch which I ultimately progressed with
Post Office and was appointed as Subpostmaster, as I describe further below.
12. The discussions I had with my parents around this time were about purchase price,
outgoings, and ensuring the lease of the Branch could be renewed after its then
current 12 year term, or possibly purchasing the freehold. This reflected the long term
basis on which I entered the relationship with Post Office. I did not at the time know
anything about the significance of the change to the Horizon system, which had not
been in place during my parents’ time and I did not discuss with them.
B. APPOINTMENT PROCESS
Prior to Interview
13. I first became aware of the opportunity to become Subpostmaster of the Charlton
branch when I saw an advert in a newspaper. I enquired about this business
opportunity and received by email on 21 August 2006 a brochure about the branch
from Christie & Co [NA1/1-2], I think it is likely that I first made contact with Post Office {E4/5/1-2}
in August 2006 after receiving the brochure, to register my interest. I was in
discussions with Mr Sandhu, the then Subpostmaster of the Charlton branch, around
this time.
14. As explained above, I was also looking at the Denton branch over the same time
period, and I obtained the trading accounts and made an offer for the Denton branch
around this time, but did not choose to progress it with Post Office. Denton was my
back-up plan in the event that I was unable to secure the necessary finance to
purchase the Charlton branch.
15. Post Office have disclosed a document dated 7 April 2005 which is addressed to me
and headed “Re: Application for position as a Subpostmaster” [NA1/3-19], but I{E4/2/1-17]
confirm that I did not apply for any position of Subpostmaster in 2005. My first contact
with Post Office was not before mid-2006.
16. I believe the first correspondence I received from Post Office in relation to the Charlton
branch was a letter dated 6 September 2006 [NA1/20-21], thanking me for registering {E4/10/1-2 -
my interest. Post Office has disclosed an incomplete copy of that letter, so I am not
sure of its full contents, but I can see that the letter required me to return and complete
Post Office’s standard form application form, and provide the required evidence to
support it, as itemised at the back of the application form. As set out in that letter,
3
C1/4/3
Post Office required me to incur all costs, liabilities and expenses in connection with
my application at my own risk. The letter included estimated remuneration in the
branch of £106,196 per annum, and identified the hours that the branch must remain
open, which the letter stated could be varied from time to time in writing by Post Office.
The remuneration and opening hours also appeared in the brochure which I had seen
from Christie & Co prior to applying.
{E4/14/1-8}
17. I completed Post Office’s standard form application form as required [NA1/22-29], My
wife and I signed the application on 27 September 2006. I completed the checklist at
the back of the application form [p29], and provided to Post Office each of the {E4/14/9}
documents as ticked on that list.
18. As recorded on the checklist, I provided a copy of the application form itself, and my
CV [NA1/30-31], {E4/6/1-2}
19. I provided documentary evidence to Post Office that I was negotiating a lease of the
premises, and evidence of the agreed provisional sale of the business. I provided an
email dated 8 September 2006 from a retail negotiator acting for Mr Sandhu which
confirmed that a sale was provisionally agreed, [NA1/32], a letter from Mr Sandhu {E4/11/1}
dated 19 September 2006 confirming the agreed purchase price was £80,000 plus
stock at valuation [NA1/33], and a letter dated 27 September 2006 recording {E4/13/1}
provisionally agreed terms of an annual rent of £14,500 and a 12 year term [NA1/34], {E4/15/1}
20. Christie & Co had provided me with copies of the last 3 years’ accounts for Charlton
(as referred to in their email to me dated 23 August 2006 [NA1/35]), and I am sure {E4/8/1}
that I provided these to Post Office as indicated on the checklist, however I no longer
have a copy of these accounts and Post Office have not disclosed a copy. I recall that
I considered these accounts with my accountant as I was considering the financial
viability and profitability of both Charlton and Denton at this time when deciding which
application to pursue.
21. Post Office required me to provide evidence of how I intended to finance the venture,
and I therefore provided a letter from my sister, Mrs Nazneen Ibrahim, dated 15
September 2006 confirming a £25,000 interest free loan [NA1/36], a letter from my{E4/l2/l>
mother, Mrs Mumtaz Abdulla, dated 5 October 2006 confirming an interest free loan
of £10,000 [NA1/37], and pre-contract information for a ten year loan from Barclays{E4/22/l>
Bank [NA1/38], at a rate of 8.7% per annum, with a total charge for credit of £12,506 {E4/91/1}
and charges for either breaking the agreement or early repayment.
4
C1/4/4
I am aware that over this period Post Office followed up references with Barclays Bank
(letter dated 3 October 2006 [NA1/39]), and my personal referees, former colleagues, {E4/20/1}
Mr Ashley Thompson [NA1/40] and Mrs Anita Jamgotre [NA1/41], {E4/19/1} {E4/21/1}
I also recall that I completed the standard form business plan as required by Post
Office. I no longer have a copy of this completed document and Post Office has not
disclosed a copy, however I believe the form of business plan I completed was the
same or very similar to the sample which was provided to me by the business agent
acting for the Subpostmaster of the Denton branch, which is marked “For
Demonstration Purposes Only” and “version 1.4 27th March 2002" [NA1/42-75]. {E4/9/1-34}
The Post Office standard form business plan explained what a business plan was (“A
business plan is a planning document that outlines in words and figures your proposed
business idea ') [P44], and its purpose (“The business plan is a monitoring tool for {E4/9/3}
you”) [p44]. It required short term (1 year), medium term (3 years) and long term (5{E4/9/3}
years) objectives to be identified and set out [p48-49], which reflected my
understanding that this was indeed a long term proposition. {E4/9/7-8}
The standard form business plan provided guidance as to what to consider in various
respects, for example requiring competitors to be identified (“Consider all your
competitors, not just other Post Office branches’) [p49] and guidance in identifying {E4/9/8}
customers (“If your business is to succeed, you must retain existing customers and
try to attract new ones. To do this you must have a clear understanding of who your
customers are, what they purchase from you, and, most importantly, why they choose
to shop in your outlet. You must identify what price your customers are prepared to
pay and the level of service they expect to receive”) [p51]. I do not now recall the {E4/9/10}
information I provided in these sections, but I responded to the questions which Post
Office asked of me and the guidance in the body of the standard form.
There was specific guidance about the need to obtain accounts (“It is essential for the
success of your business that you investigate its viability before opening for business.
It is imperative that you are satisfied that the business is a viable one. This can be
achieved by the assessment of the outgoing subpostmaster's accounts either by
yourself, if you are experienced enough, or by your accountant or business advisor.
You should also undertake some research to substantiate the financial projections
that are made ’) [P56], I obtained Mr Sandhu’s accounts as explained above, and {E4/9/15}
discussed these with my accountant.
5
C1/4/5
27.
I also made enquiries with Mr Sandhu to understand the retail and products which
had been offered at the branch and were then being offered at the time of sale. There
had previously been a larger retail offering, but at the point of sale these were limited
to small packing items such as boxes and envelopes, hence I recall that expanding
the retail side was an area where I anticipated being able to improve the profitability
of the branch. I believe it is likely I completed this part of the business plan with this
information from Mr Sandhu and contained in his accounts.
28. There was a specific section of the business plan headed “Connecting with the
community including the introduction “Our network of Post Office branches reaches
into the heart of communities to provide customers with convenient access to a
diverse range of products and services. Over the years a synergy has developed
between businesses and the community and it is imperative to us that this relationship
is maintained and nurtured in the future ” [p55]. I mention this because it generally {E4/9/14} |
reflected my understanding of Post Office as a trustworthy brand who would be
working together with me to make the Branch a success.
29. The business plan was drafted in various places to generate figures which were then
I
required to be transferred into the profit budget and cash flow (e.g. a requirement to
i
identify improvements, and an example entry of £250 for a freezer cabinet) [p52].{E4/9/ll> i
There was then a blank form of profit budget with pre-populated category entries
{E4/9/28} [p69], and a blank form of cash flow forecast in a similar style [p72] which I was <E4/9/3l>
required to complete. I believe I prepared these documents based on the Post Office
template.
30. As I have explained above, I no longer have a copy of the completed business plan
which I submitted, but I have seen a copy of Post Office’s Agency Business Plan
Financial Assessment dated 18 October 2006 [NA1/76-79], although it appears that{E4/28/l-4}
the second page of this document is missing. On reviewing this document I think that
the figures which appear on [p76] in the column headed “Outgoing P&L Y/E 05/04/05’ {E4/28/2}
have been taken from Mr Sandhu’s trading accounts for the year ending 5 April 2005,
which I provided to Post Office and referred to in my business plan. I think that the
figures which appear in the adjacent column headed “Incoming - Actual figures” are
the projected figures which I provided in my business plan. These are all estimates
as they are round numbers throughout. I believe that all the additional columns to the
right are calculations or adjustments made by Post Office when carrying out its
analysis. I believe that the tables headed “Other Cash Impacts” on the bottom half of
the page are Post Office calculations and not my own, although the figures which
appear for bank repayments and personal requirements may have been derived from
6
C1/4/6
information in my business plan (as suggested by the notes on [p78]). I do not believe {E4/28/3}
I made provision in my business plan for £1500 losses in year 1, and do not know the
reason this figure appears in Post Office’s assessment of my business plan. There
was no guidance in the standard form business plan to include provision for losses, I
was not expecting to make losses in this way, and this was not something which was
discussed with me at the time.
31. Preparing the business plan and providing the information required by Post Office was
onerous and time consuming. It also had to be completed under some time pressure.
It took a long time to complete the business plan itself, and I also think that Post Office
may have sent it back to me and required me to make adjustments (although there
are no disclosed documents which record this). In order to produce the documents
required by Post Office I had to invest significant time and energy in the process. At
the time I thought this was reasonable because I believed I would be entering into a
long term commitment with Post Office and therefore incurring accountants’ fees, and
making long term arrangements for a bank loan and for the purchase of the Branch
and lease were worthwhile commitments.
32. Post Office sent me a letter dated 29 September 2006 [NA1/80], which required me {E4/17/1}
to provide some additional information, which I did provide. I know I provided Security
Checks Consent Forms [NA1/81-82], but I cannot now identify what further{E4/23/1}
documents I provided as written evidence of acceptance of loan. It is possible this is{E4/25/l>
the pre-contract information from Barclays Bank referred to above.
Discussions with Mr Sandhu
33. I am aware that in Post Office's Defence to my claim, Post Office says that I would
have obtained information about Post Office’s terms of trading including contractual
terms, operations manual and other matters from Mr Sandhu. However, this is not the
case. My discussions with Mr Sandhu were largely in respect of financial matters,
negotiating the purchase price for the Branch (which Mr Sandhu had increased after
advertising it) and discussing the terms of the lease. I was concerned that the lease
had only a 12 year term left to run, and I wanted to ensure that it would be renewed
after 12 years, which was something I discussed with Mr Sandhu at the time. I also
had discussions with Mr Sandhu about purchasing the freehold after I had been
appointed as Subpostmaster of the branch.
34. I definitely did not obtain a copy of Mr Sandhu’s contract or see the Operations
Manuals or any other contractual documents, and there was no mention of these in
7
C1/4/7
the times I met with Mr Sandhu. I did not think to ask him about these, and do not
believe that he was permitted to share them with me. Post Office didn’t ever suggest
I should obtain contractual documents or information from Mr Sandhu, and I would
obviously have expected this type of information to come from Post Office.
35. Mr Sandhu was trying to sell his branch to me, and this was his focus. I did discuss
with Mr Sandhu the retail offering at the branch as explained above, and I recall I also
discussed staffing with him. He recommended to me that I should keep on the existing
assistants who were experienced, and I would be able to learn from them. I thought
this was good advice. I also understood that as a matter of employment law (TUPE)
these assistants had to transfer to me. This was something which was also mentioned
in my interview with Post Office.
Interview
{E4/30/1-17'
36. After providing all the information required to Post Office as described above, I
received a letter dated 9 November 2006 [NA1/83-99] inviting me to interview on 22
November 2006. The letter clearly indicated to me that the purpose of the interview
was for me to meet Post Office’s requirements, and that Post Office would be asking
me questions about my skills and business plan. I recall receiving this letter and I think
it is likely I read through the body of the letter. I do not particularly recall the attachment
which was headed "Brief Summary of Certain Sections of the Subpostmasters
Contract” and do not think it is likely that I paid particular attention to any part of that
summary, given the way the summary was described (expressly stating that no action
could be taken on the basis of it [p87], and no reliance on it [p84]) and the number of -CE4/30/5>
varying points which were covered in the quite lengthy document. None of the {E4/30/2}
sections were highlighted or further explained. With my understanding about Post
Office’s business prior to contracting, all I could have understood about the provision
for losses was that it might cover something like mistakenly handing back too much
change to a customer, resulting in losses of a few pounds or pence, or selling
something small at the wrong price. I had no idea at the time that Post Office would
seek to rely on the contractual provision for losses in the way it in fact did, including
issuing transaction corrections for hundreds and thousands of pounds, when I was
not able to identify that there was any real loss at all, or how the error had arisen.
37. I attended an interview with two of the Defendant’s employees, Ms Elaine Ridge,
contract advisor, and Ms Christine Adams, who would become my area manager.
The documents disclosed by Post Office variously record the interview as having
taken place on 13 November 2006 or 22 November 2006, but having looked through
8
C1/4/8
the documents and in particular my invitation to interview letter above, I think it is likely
that the interview took place on the later date, 22 November 2006.
38. Most of the interview was taken up with Ms Ridge asking me questions.
39. At the time of the interview I thought that I would be working in partnership with Post
{E4/33/1-3}
Office, and I can see from Post Office’s notes of the interview [NA1/100-102] that they
have recorded this point [pi 01]. I am sure there was no objection from Ms Ridge or {E4/33/2]
Ms Adams to this description. I knew I would not be an employee but I understood
from the advert and the interview that I would be working together with Post Office
and making money together. I understood at interview that Post Office would provide
me with necessary and appropriate training and support so that I could perform the
role of Subpostmaster,
40. I explained during the interview the reasons why I wanted to become a
Subpostmaster, specifically my desire for security as explained earlier, and this is also
recorded in Post Office’s notes [p101]. Ms Ridge and Ms Adams did not say anything {E4/33/2}
to me about the way in which Post Office might terminate my contract and I
understood we were all proceeding on the basis that if appointed this would be a long
term and secure position.
41. My previous sales experience was something which I recall was discussed, in
particular how I would be able to sell Post Office products. The reference to training
of assistants in Post Office's interview notes [pi 02] is a reference to me training staff {E4/33/3}
about selling Post Office products. We also spoke about how I could use my sales
experience to incentivise staff to sell more products. I recall that this was discussed
at the interview at some length and Post Office was interested in my sales abilities.
42. I do not recall either Ms Ridge or Ms Adams providing any information or explanation
to me about the preparation of accounts or responsibility for losses and gains, and I
do not believe they did so. I can see a reference in Post Office’s notes to me being
"aware that there is a need to ensure work is correct so that a postmaster gets paid
correctly but I don’t believe this is a reference to any discussion about liability for
alleged shortfalls, or that there was any discussion about what this might mean in
practice. If there was a discussion about this then it can only have been on the basis
of my understanding about giving the wrong change, or minor errors as I have
described above. If I had been told at interview that Horizon operated in the way it in
fact did, and that I would be held liable for hundreds and thousands of pounds of
alleged shortfalls, I would not have accepted the appointment.
9
C1/4/9
43. There was a discussion during the interview about the need for me to improve lighting
and carpets within the branch. I also remember being told that all lottery transactions
had to go through Horizon, as this was not being done by Mr Sandhu. I understood
these were Post Office’s conditions, which were not open for negotiation.
44. I don’t specifically recall a discussion about the number of hours I would work in the
branch or personal service, but I had said in my business plan that I would be working
in the branch for 40 hours per week so Post Office might have proceeded on that
basis.
{Dl.4/1/1-5}
45. Although it was not shown to me at the time, I have now seen a document headed
"Conditions of Appointment at Post Office Charlton branch" [NA1/103-107] which
includes the requirements I have referred to above, and the hours of opening, and a
requirement for me to provide not less than 18 hours personal service each week.
This document is signed by Ms Ridge.
Post Interview
46. I do not recall which documents I was sent by Post Office after the interview. I have
seen a document headed “Mr Naushad Abdullah Conditions of Appointment for Post
Office Branch” which has in the top right corner Appendix 1M (Return Copy)
[NA1/108-109], This has been signed by me with my bank details on 11 December {E4/45/1-2;
2006.1 obviously accept that I must have been sent a copy of this document in order
for me to sign and return it.
47. I'm aware that Post Office in its Defence to my claim says that I would have received
an Appointment Pack together with a letter confirming that my appointment was
successful and that the Appointment Pack included a copy of the Modified SPMC. I
do not recall this and do not recall receiving a copy of any contract. I have not seen a
copy of the contract that Post Office claims I was sent. I was not given a copy of a
contract at interview or on branch transfer day, and nobody ever discussed a contract
with me. I did not have legal advice in relation to the appointment and trusted Post
Office in its dealings with me.
48. I have seen a copy of a letter from Post Office to me dated 4 January 2007 [NA1/110- {E4/47/1-2)
111], which confirms the branch transfer day as 24 January 2007, and states that a
member of the Training Delivery team would contact me nearer the time to discuss
training arrangements. Training was arranged with me as I explain below, although I
expect that I already knew about these dates before this letter from Post Office.
10
C1/4/10
49. After receiving confirmation from Post Office that I was going to be appointed as
Subpostmaster of the Charlton branch, I finalised the purchase of the branch and 12
year lease, and entered into the loans which I had provisionally arranged, including
the ten year loan from Barclays. Post Office later asked me to provide evidence of the
{E4/59/1-2]
lease (Post Office letter dated 3 September 2007 [NA1/112-113]) which the solicitors
who acted for me confirmed (Braund & Fredrick letter dated 12 September 2007
[NA1/114]). <E4/60/1>
50. I would not have entered into these commitments if I had expected Post Office to
terminate my appointment without notice, on 3 months’ notice, or without
compensation for loss of office. I would not have exposed my family to these financial
risks and uncertainty, stress and worry.
Classroom Training
51. I attended Post Office training in Ilford between 8 January and 20 January 2007. This
training was provided in a classroom, and there was a training version of Horizon
available to use.
52. Most of the training was about carrying out specific transactions and learning about
Post Office sales techniques and products, and information about e.g. the rules about
hazardous items.
53. When we worked on the dummy Horizon terminal, we would simulate someone
coming in to buy a stamp. The terminal was not live and I don’t think we covered
balancing or how to deal with a transaction correction. If we did then this was not
covered in any detail.
54. I would describe the training overall as very focused on the sales and transaction side,
and it was thorough in this respect. However it was obviously going to be important to
have detailed in branch training on all other aspects of running the branch in practice
and working on the live Horizon system.
Branch Transfer
55. Branch transfer took place on 24 January 2007. The area manager Ms Stevens
attended and assisted with the audit, which took a long time. I had to wait outside
while this took place and was only allowed to enter the branch afterwards.
56. Events on the day felt rushed and I would describe the day itself as hectic. Documents
were presented to me by Ms Stevens as if my signature was a formality, rather than

C1/4/11
documents I should read carefully before signing or which I might not agree to. I was
not provided with any of the documents I was asked to sign in advance, and Ms
Stevens didn’t explain any of them to me. We were standing up in the branch at the
time.
57. I signed the single page Acknowledgement of Appointment [NA1/115] on this day. I{Dl.4/3/1}
don’t know what the references to “my contract', “book of rules" or “postal instructions"
mean even now. These were not explained in the document and weren't explained to
me at the time.
58. I recall the document which is headed ARS 110 in the top left corner and with the title
“POST OFFICE LTD" [NA1/116], I was asked to sign this in the same way as above. (E4/54/1)
It was not me who ticked the various items and I believe this was Ms Stevens. The
list of manuals referred to the folders of manuals in the branch which contained
information about various topics and Post Office products and services, including e.g.
fishing licenses. I didn’t have access to these manuals until that time. I no longer have
these documents. I can see that Horizon User Guide and Horizon Balancing Guide
are not ticked on this list, however I recall that when operating the branch I had a step
by step laminated double sided document for Horizon balancing, which may be the
i
Balancing Guide referred to on this list. I don’t recall a Horizon user guide and don’t
know what that would be.
I
59. I don’t specifically recall signing the document headed P301 "NON-DISCLOSURE
STATEMENT - OFFICIAL SECRETS AND CONFIDENTIAL INFORMATION”
[NA1/117-118]. I don’t believe this document was explained to me at all, although i-^4/55/1 2
now see that the content is potentially very serious.
{E4/51/1-4}
60. A standard form letter headed SERV 135B (MSPO) [NA1/119-122] to ‘‘your contract”
was presented to me in the same way as the other documents. I did not have a chance
to read and understand this document before signing it.
61. I don’t recall all the documents I was asked to sign on branch transfer day, but believe
that there were more documents in addition to those I have described above.
In Branch Training
62. My first day operating the branch as Subpostmaster was 25 January 2007 and Post
Office trainers Ish Chohan and Junaid Tanveer were in the Branch with me for around
the first 5 days.
12
C1/4/12
63. The trainers observed me while I was serving customers. This was my first time live
selling on Horizon after using the dummy system during classroom training, and the
trainers would tell me what to press on screen.
64. The main focus during this onsite training was again, sales and transactions, however
at the end of the day the trainers told me how to carry out back office tasks such as
ordering stock, dealing with giros, accepting rem, and handing over cash to security
personnel. I was also shown during this time how to conduct a balance.
65. The training in relation to accounting processes, reconciliation and balancing was not
particularly detailed. I remember that I was told to make good any losses, which I
understood would be actual losses to Post Office, which I would be able to trace on
the Horizon system. I understood from all my training that Horizon was safe and could
be trusted.
66. I wasn’t told in any detail how to investigate or resolve discrepancies or apparent
shortfalls showing on Horizon, or how I could use any of the Horizon functionality to
do this, I was just told to contact the Helpline. I think this was the main area where the
Post Office training provided was lacking.
67. I have seen a copy of a Post Office document headed “Confirmation of Sales Training
and Compliance" which is unsigned but dated 31 January 2007 [NA1/123-124], and (E4/56/l-2>
I recall being trained about increasing Post Office sales, and indeed this being
emphasized during my dealings with Post Office. I was confident in my sales abilities
and that I would be able to succeed in this respect.
68. I have also seen a copy of a document headed “Learning action plan” which is also
unsigned but dated 31 January 2007 [NA1/125-127], I am not sure if I saw this{E4/57/l-3}
document at the time, but I believe most or all of the entries are standard / generic
entries and not specific to my particular learning. Also most of these entries concern
product sales and promotion. There is also a record of my dealings with customers
where the Post Office trainer has recorded whether I offered Post Office products or
services [p127] which reflects this emphasis on sales. {E4/57/3}
69. I recall that the trainers came back on a minor balance day (i.e. a weekly balance)
and a major balance day (i.e. a monthly balance). I don’t recall any further contact
with the trainers, and did not have any way to contact them myself.
13
C1/4/13
70. I was advised by Post Office’s trainers when they were present that if I had any issues
or problems, I should contact Post Office’s Helpline and they would be able to assist
me. I was not advised of any other help or support offered by Post Office.
71. Later during my appointment as SPM, the area manager would occasionally visit the
Branch to check we had the latest point of sale material, or go through our
performance in the league tables in area news. We were a well performing branch so
these were usually positive discussions. Sometimes he provided training to me and
my assistants about the sale and promotion of new products. No further training was
provided to me in relation to Horizon or balancing.
Compliance with Post Office Conditions
72. After opening the Branch, I refurbished the ceiling, lighting and carpets. I understood
these to be conditions of my appointment.
73. Soon after opening, I also incurred some costs to clean and repair external shutters
which had been graffitied and did not open properly, and to repair a broken window
at the rear of the property. I don’t think I raised these items with Post Office but I
expected they would require me to have kept the property in a good state of repair.
74. As I recall Post Office and I also later jointly shared the cost of external signage, which
was arranged to reflect a new Post Office design or colour scheme.
C. SPECIFIC ISSUES AND ASPECTS OF THE RELATIONSHIP
Expectations and Reliance on Post Office
75. I was reliant on Post Office prior to my appointment and during my appointment to
provide me with adequate training, assistance, support and information to enable me
to carry out my role as Subpostmaster. My expectation when contracting with Post
Office was that this would be provided, and I believe this was Post Office’s
expectation. I believe both parties entered the relationship on the basis that we would
be working together and sharing information.
76. As I have explained above, I didn’t have legal advice, and I didn’t have any clear
understanding of the contractual position between myself and Post Office, or the
status of the various documents which I had been asked to sign. Post Office has also
not provided me in these proceedings with a copy of the standard form contract which
it says would have been sent to me.
14
C1/4/14
Horizon and Helpline as Services
77. I understood Horizon to be something provided to me by Post Office, which was
intended to be for my benefit. It was a system which Post Office controlled, and
required me to use in the Branch. If there were problems with Horizon which required
an engineer, then Post Office would arrange for an engineer to be sent to the branch.
I relied on Post Office to provide Horizon and that it was safe and could be trusted -
this is what I had understood from my training and in reality I had no other choice but
to trust Horizon.
78. I remember that on a number of occasions Post Office updated Horizon hardware and
software, and sometimes this required the branch to close for half day periods. I lost
business and income during these times. These closures were entirely in the power
of Post Office.
79. Prior to and during my appointment, Post Office consistently told me to rely on the
Helpline if I had any problems with Horizon and that it would be beneficial to me. I
understood it was something which Post Office provided to Subpostmasters.
How Post Office Ran its Business
80. I have been shown paragraph 16 of Post Office’s Defence in my case, where Post
Office states that it is to be inferred that I would have obtained information about the
way in which Post Office ran its business and about the business relationship it had
with its Subpostmasters. I have described above the information I did obtain from Mr
Sandhu prior to my appointment. If it is right that Post Office ran its business in the
way that I experienced during my appointment, then I confirm that I did not know about
this prior to my appointment. I specifically did not know about the limitations in training
and support (including the way in which Post Office operated the Helpline), the way
in which Horizon operated in practice, Post Office’s approach to audits and
investigation, or its approach to suspension and termination.
81. If I had known about these points in advance I would not have wanted to take on the
branch and would not have wanted to enter into the commitments I did.
Training, Support and the Helpline
82. The training I received in relation to sales and products was very thorough and met
or exceeded my expectations. However, the training was not thorough enough in
relation to what to do when there was a problem or how to investigate or resolve
15
C1/4/15
problems. There was no guidance or support about this. Prior to my appointment I
expected this to be covered in much more detail. I was left alone in this so I didn’t
know where to look to find the problem or the possible solution.
83. I estimate that I called the Helpline on average 6-7 times per month, but I could only
get through less than half of those times. I often sought assistance on balancing days
when I experienced apparent shortfalls but found that the Helpline was frequently
engaged or continued to ring. When I did get through I generally did not find the advice
I was provided to be helpful, and it sounded as if the advisers were reading from a
script.
84. It didn’t seem as if the advisers knew the Horizon system well, and I felt that advisers
brushed off issues, and instead of trying to investigate and resolve apparent shortfalls
with me, they just said that I should expect them to be corrected by a transaction
correction.
85. I was genuinely shocked and surprised at the lack of adequate support provided to
me in relation to apparent shortfalls. In the pharmaceutical industry there is expert
assistance available, and I expected the same here. On the basis of what I had
understood prior to appointment, I expected the Helpline to be useful and reliable, and
to provide all necessary practical support and assistance to enable me to get to the
bottom of any problems and to resolve them.
86. When I was experiencing problems with apparent losses I contacted the Helpline to
request more help with investigating the alleged shortfalls but this was not provided.
I also asked my area manager for help but he only ever gave very limited advice, and
he just said to go back through my paperwork or call the helpline.
87. Prior to contracting I did not expect to encounter the problems I did with apparent
shortfalls, but I expected there to be ongoing training and support available so that if
I did encounter problems this would be available to me, and Post Office would assist
me. I did not expect to be left with problems which I was unable to resolve, as was in
fact the case. I thought a Post Office expert would attend my office and help me work
out what had happened before requiring me to pay in anything more than minor sums.
I expected there to be necessary expert support available, but in practice the only
support I had access to was the general Helpline.
Horizon
16
C1/4/16
88. Apparent shortfalls began appearing in my accounts soon after branch transfer and
continued regularly after that.
89. Prior to being appointed I expected Post Office would want to help me to investigate
any problems, which would include what I experienced in relation to apparent
shortfalls, and to help me to prevent them from occurring again. In practice Post
Office’s priority in relation to apparent shortfalls was always just to have the amount
paid, and there seemed little or no will to investigate what had happened or whether
these were genuine losses to Post Office.
90. I have seen the transaction correction data disclosed by Post Office in these
proceedings in the form of a spreadsheet for the period 8 March 2007 to 4 April 2009
[NA1/128-133], I had not seen this list before, and do not think it is something I could {E4/92/1}
have produced using Horizon. If it was a report I could produce, then I did not know
how to do it or that it was possible. I now think this type of report would have been
very useful to me.
91. Looking at this report now, it is difficult to know why all the transaction corrections
were issued, because there is usually such little information provided. I think that the
information which is shown in the “Text 01” or “Text 02” columns is information that
would pop up on the Horizon terminal and then prompt for the transaction correction
to be accepted (a transaction correction had to be accepted either immediately or
before the accounts were rolled over into a new trading period). Sometimes the text
box said that evidence would follow. I don’t know why for many of the transaction
corrections there is no text providing an explanation.
92. A particular issue which causes me concern when reading this list is the number of
apparently lost cheques. Throughout my appointment Post Office held me responsible
for any cheques which apparently went missing on the way from the branch to the
bank. Post Office simply accepted that if the bank said a cheque hadn’t been received
then the fault was with me, and I had to pay in this amount. It is clear from the list of
transaction corrections that this happened on many occasions and for cheques for
hundreds and thousands of pounds. Post Office didn’t carry out any investigation, it
just sent me a copy of the record of cheques I had sent out, and a photo copy of the
cheques the bank said it had received. I could not prove to Post Office that the missing
cheques had in fact been sent, and Post Office always accepted the bank’s position
where there was disagreement about this
17
C1/4/17
93. The further point which concerns me is entries as credits or debits. In the column
“Value of TC" where an amount is a debit, to be deducted from my account, it appears
as a positive value. Where it is a credit to my account, it appears with a negative sign
in front of the number. There is an entry dated 14 May 2008 which reads “National
lottery chq no 157715 issued on 18.04.08 for In Pounds400.00 and chq no 157717
issued on 22.04.08 for In Pounds633.00 have not been entered into Horizon.A Credit
t/c will be automatically issued to you on 20.05.08 on the sales and prize line which
will include these chqs.RegardsKaren CooperTel 01246 542283". The value of this
entry is shown as a debit of £1033, but it seems to me this should have been a credit
to my account of £1033. If this was a mistake by Post Office to issue a debit rather
than a credit, this cost me £2066.
94. I have a particular concern about a run of entries all for a debit of £1092:
(a) The first entry is dated 29 May 2008. The text reads: “THIS TC IS FOR
LOTTERY SALES. THIS TAKES INTO ACCOUNT ALL CAMELOT SALES
FIGURES FROM 17th APRIL UP TO YOUR BRANCH TRADING OF 21st
MAY WHICH DO NOT AGREE WITH YOUR HORIZON SYSTEM. THIS
LEAVES A TOTAL BALANCE OF 1092 GBP DEBIT DETAILS OF CAMELOT
END OF DAY FIGURES WILL BE DISPATCHED TO YOU WITHIN 7 DAYS
TO COMPARE WITH YOUR HORIZON SLIPS. LOTTERY TEAM TEL, 01246
542691 or 542215."
(b) The second entry is dated 27 June 2008. The text reads: “THIS TC IS FOR
LOTTERY SALES. THIS TAKES INTO ACCOUNT ALL CAMELOT SALES
FIGURES FROM 22nd MAY UP TO YOUR BRANCH TRADING OF 18th
JUNE 08 WHICH DO NOT AGREE WITH YOUR HORIZON SYSTEM. THIS
LEAVES A TOTAL BALANCE OF 1092 GBP DEBIT DETAILS OF CAMELOT
END OF DAY FIGURES WILL BE DISPATCHED TO YOU WITHIN 7 DAYS
TO COMPARE WITH YOUR HORIZON SLIPS. LOTTERY TEAM TEL, 01246
542691 or 542215.”
(c) The third entry is dated 11 July 2008. The text reads: “THIS TC IS FOR
LOTTERY SALES. THIS TAKES INTO ACCOUNT ALL CAMELOT SALES
FIGURES FROM 5TH JUNE UP TO YOUR BRANCH TRADING OF 2ND
JULY 2008 WHICH DO NOT AGREE WITH YOUR HORIZON SYSTEM. THIS
LEAVES A TOTAL BALANCE OF 1092 GBP DEBIT DETAILS OF CAMELOT
END OF DAY FIGURES WILL BE DISPATCHED TO YOU WITHIN 7 DAYS
18
C1/4/18
TO COMPARE WITH YOUR HORIZON SLIPS. LOTTERY TEAM TEL, 01246
542691 OR 542215 OR 542276.”
95. Looking at these transaction corrections now, I have no confidence that any of them
were properly issued. I don't believe it is possible that I had the same amount of
discrepancy for more than one month. The fact I could receive three transaction
corrections in a row for exactly the same amount of money in my view shows there is
a poor system of checks and controls within Post Office before transaction corrections
are issued.
96. There is a further entry, dated 14 July 2008, which is a credit for £1092 (it appears as
-£1092). The text reads: “DUE TO AN ADMINISTRATION ERROR YOU RECEIVED
A DUPLICATE TC ON SATURDAY 12THJULY. THIS TC IS A COMPENSATING TC
AND YOU SHOULD ACCEPT BOTH TO BALANCE YOUR ACCOUNT. PLEASE
ACCEPT OUR SINCERE APOLOGIES FOR THIS ERROR”.
97. There is no real explanation of how this “administration error” occurred, but this clearly
shows that errors in issuing transaction corrections did occur. Also, even if this credit
cancelled the debit on 11 July 2008, there was no credit for the 28 June 2008 debit
which must also have been an error.
98. Looking back again I can see what appears to be another duplication, on 14 April
2008, two debit transaction corrections for £250, both with exactly the same text. I
now think that one of these was likely an error by Post Office.
99. There is a transaction correction issued on 20 March 2009 for the amount of £960.
The text reads as follows: “Notes, - Evidence for this transaction correctionwill be in
your post. Please wait until your post arrives beforetelephoning us with any query and
quoteRef 51/GCC/320ur investigations have revealed that correctacceptance
procedures have not been adhered to, this product/service is not cheque
acceptable.Scottish PowerThe name on the cheque account is "Mrs Anita RulleJohn
Day 01246 542029”. I mention this transaction correction because there are some
further documents which seem to relate to the same amount:
(a) In a further spreadsheet disclosed by Post Office which is described as
account balances [NA1/134], there is a debit entry on 20 March 2009 for £960 {E4/89.1]
(this ties up with the transaction correction I have described above), but then
a further debit entry on 6 April 2009 for £960, and then later a credit on 11
April 2009 for £960. Although I cannot be sure, these entries suggest to me
19
C1/4/19
that the second £960 was a duplicate debit, which was later corrected by a
credit.
(b) There is also a Post Office internal record headed “Display Notes:
125461000940062009001” [NA1/135] which reads “Call from auditor on {E4/74.1}
08.04.09 - Postmaster not present at audit so this tc was accepted and settled
centrally by auditor. DW 09.04.09.” It appears to me now, from the date and
reference number, that this note refers to the second £960 debit on 6 April
2009 and that this was accepted during the April 2009 audit when I was not
present (which I explain below). I did not know anything about this at the time.
Even now, I do not know who it was who accepted this transaction correction,
because the initials “DW" do not match the name of the auditor who carried
out the audit (according to Post Office records referred to below, this was
Wilson Aliu).
100. It appears from the spreadsheet above that this duplicate debit was picked up, but the
fact it was issued and the Post Office auditor accepted it in my view shows that the
Horizon system and Post Office processes are not rigorous, mistakes are made, and
the potential effect on Subpostmasters is very serious. This all happened while I was
suspended, so I didn’t know about it but Post Office was affecting my branch accounts
in a way that was potentially very significant.
101. I mention for completeness that there is another document which shows a list of
transaction corrections with some handwritten marks on [NA1/136-137], It is possible{E4/65/l-2>
that this document may have been shown to me by Post Office during my final
disciplinary meeting prior to my appointment being terminated, however I do not
specifically recall. The list is not in date order and is hard to understand, there is also
less information on here than on the long transaction correction data spreadsheet I
have referred to above. This list is not a complete list, and for example doesn’t include
any of the £960 transaction corrections I have referred to above.
102. As I have explained above, transaction corrections appeared on Horizon as a pop up
box. As far as I recall there was no process in Horizon which required proof that I was
the person accepting the transaction correction (rather than an assistant, or even a
Post Office employee), which I do not think was right if ultimately I was to be
responsible for the adjusted accounts.
103. Prior to being appointed I didn’t know anything about the process of transaction
corrections and didn’t expect this process or the problems I encountered with it. Post
20
C1/4/20
Office had given me the impression that Horizon was an impressive automated
system. However the reality is that there are individuals inputting entries into it on the
Post Office side, and these individuals are able to make mistakes.
104. During my appointment, when I experienced apparent shortfalls in my accounts which
I could not find the cause of, initially I paid in the amount in cash, using my own funds,
in order that I could balance and roll over to continue trading. The way Horizon is set
up is that unless an apparent shortfall is accepted and made good immediately, or the
option selected to settle centrally, it is not possible to enter a new trading period. This
is illustrated by the 16 April 2009 letter which I refer to below, following my suspension.
Post Office has not disclosed other letters sent to me in relation to other transaction
corrections.
105. However, as a result of the problems I was experiencing, I came to not trust the
information which was showing on Horizon. Because I wasn’t able to investigate the
issues effectively (as I explain below) and was reliant on Post Office to hopefully issue
transaction corrections in my favour, I was not confident that the figures showing on
Horizon were correct, or that apparent shortfalls were in fact real losses. One of my
assistants told me that the former Subpostmaster kept a cheque in the till to cover
apparent shortfalls where it was thought likely there would be a transaction correction
later issued, and after a period of time I also adopted this practice.
Audits and Suspension
106. Post Office conducted a first audit of the branch on 14 June 2007. The auditor was
Mr Dave Rodericks. I was not informed in advance that the audit was taking place,
but I was present in the branch on the day. During the audit Mr Rodericks identified
an apparent shortfall of £304.14, which is recorded in Post Office's audit report
[NA1/138-142] that I have now seen, but I do not think was shown to me at the time(E4/58/l-6>
107. There was no investigation by Mr Rodericks as to why there might be this discrepancy.
He made clear to me that I had to pay in this amount, and I did this in cash the same
day. I understood I had to do this and that I didn’t have a choice.
108. The second audit took place on 6 April 2009. I had gone on holiday to Dubai the day
before for a period of two weeks. I was required to notify Post Office of my holiday
dates in advance so I believe they knew before carrying out this audit that I wouldn’t
be present.
21
C1/4/21
109. One of my assistants, Ms Daljit Matharoo, who was looking after the branch in my
absence, was present during the audit. I understand that an apparent shortfall of
£4,905.19 was identified by Post Office’s auditor Aliu Wilson, which Ms Matharoo
{E4/67/1-3} agreed. These points are recorded in Post Office’s audit report [NA1/143-145] but
again I do not think I saw this at the time.
110. I have also now seen two versions of a Post Office internal document P344 Transfer
{E4/70/1-2} Report’ [NA1/146-147] and [NA1/148-149], one of which appears to be dated 1 April(E4/73/l-2 •
2009. I do not know the reason for the date on this document, but I do think it is odd
that it predates the actual audit at the branch.
111. I found out about the second audit while I was in Dubai, a few days after it happened.
I first heard from my dad, who Ms Ridge had called as a contact for me, and then I
received a phone call from Ms Ridge, who told me that I had been suspended. I don’t
think I received the letters addressed to me from Post Office dated 6 April 2009
{E4/68/1} [NA1/150] [NA1/151] relating to the decision to suspend me because the address on{E4/69/l}
the letters was not my address at the time.
]
112. When I returned to the UK, because I was suspended, I was not permitted to enter
the branch. I was not able to retrieve some personal belongings that were held within
the branch and had to ask the temporary Subpostmaster appointed by Post Office,
Mr Naeem, to give these to me. As I was not permitted to enter the Branch, I was not
able to do any investigations into the alleged shortfall amount.
113. Prior to contracting I never expected Post Office to choose to conduct an audit while
I was on holiday. I also didn’t expect them to take decisions directly affecting accounts
and amounts they would hold me liable for without my knowledge. I am shocked to
see in Post Office’s disclosed documents that a Post Office auditor accepted a
transaction correction on the day of the audit when I wasn’t present and without my
knowledge.
Termination
{E4/75/1-4}
114. Post Office sent me a letter dated 14 April 2009 [NA1/152-155] (sent to my new
address), which said that Post Office was considering terminating my appointment,
referring to “loss at the time of audit of £4398.32" and also referring to the undated
personal cheque for £2,500 which I have referred to above. The letter quoted contract
terms, and said that Post Office was giving me the “opportunity to put forward [my]
version of events relating to the above charge” and invited me to a prearranged
interview on 30 April 2009. I was told I could bring a friend who was a Royal Mail
22
c 1/4/22
employee, assistant or Subpostmaster, who may be a representative of the National
Federation of Subpostmasters (NFSP). I understood that I was not allowed to bring
a lawyer.
115. It doesn’t appear to me from Post Office’s letter that Post Office had carried out any
investigation into whether the amount found at audit was a real loss or may have been
caused by an error on Post Office’s behalf.
116. I have seen a document headed “Former Subpostmasters Statement of Discrepancy’
{E4/76/1} dated 16 April 2009 [NA1/156], and an attached print out [NA1/157], From the date,{E4/77/l}
this statement of discrepancy was prepared after the audit and while I was suspended,
and provided evidence of a credit due to the branch in the sum of £978.88 relating to
Alliance and Leicester Co-Op cheques for the week commencing 4 March 2009 (i.e.
prior to my suspension). I have also seen a letter dated 16 April 2009 [NA1/158], {E4/78/1}
which suggests that this paperwork was sent to the branch, rather than to me at home
while I was suspended. Although this letter refers to a credit, the way it is prepared
and minimal information provided is similar to what Post Office would provide in
support of a debit. The letter also shows as I have described above, that transaction
corrections have to be accepted by the end of a trading period, even if they are
disputed.
117. I attended an interview with Ms Ridge on 30 April 2009. I was accompanied by Mr
{E4/82/1-29} Mike Darvill from the NFSP. I have seen Post Office’s notes of the interview [NA1/159-
187] which say at the top the purpose of the meeting was for me to put forward
reasons why my contract should not be summary terminated. This reflects Ms Ridge’s
approach at interview which I believe was unhelpful and confrontational. Prior to
contracting I expected any formal process like this to be conducted fairly and after a
proper investigation. I was therefore surprised with the way the interview was
conducted.
{E4/79/1-38}
118. My solicitors have prepared a transcript of the interview [NA1/188-225] (from Post
Office’s recording of it) which is more complete than the Post Office notes I have
referred to above and therefore I refer to it here. I think it is important to note that as
the transcript records, I was specially raising that there was no way I would be short
{E4/79/17} {E4/79/18} of £1,092 on the lottery [p204-205,207 and 212]. However, in the interview, Ms Ridge{E4/79/20)
did not seem to be interested in getting to the bottom of this issue and didn’t accept{E4/79/25}
that I was owed a compensating amount in relation to lottery, although she said she
{E4//79/20} would go back to Camelot [p207]. I believe the document I was looking at in the
interview when I asked “is that all the transaction corrections for the office?” [p213]{E4/79/26>
23
C1/4/23
{E4/65/1-2)
119.
120.
121.
{E4/84/1-3}
122.
{E4/85/1-2}
{E4/83/1-2}
was likely the list of transaction corrections I have referred to above [NA1/136-137],
and that I had not seen this before the interview.
I didn’t know prior to the interview that the amount of the apparent shortfall had
reduced to £3,926 [p225] and Post Office didn’t explain the reason for this. I was{E4/79/38}
completely in Post Office’s hands as to how much Post Office said I had to pay, and
was not given any proper explanation for this. I never expected prior to contracting
that Post Office had so much power and would be able to just tell me the amount I
had to pay to them. I was given the impression during the interview that if I paid this I
would likely be reinstated, and that is the reason I paid the amount to Post Office by
cheque the same day [NA1/226].{E4/81/1>
I believe Post Office sent me a letter terminating my appointment, but telling me I had
a right of appeal. I no longer have a copy of that letter and I understand that Post
Office has not disclosed a copy in these proceedings. I have not seen any documents
which suggest that Ms Ridge in fact followed up any of the issues with the lottery
transaction corrections or any other potential evidence in my favour which I had raised
during the interview.
I appealed the decision to terminate my appointment. I believe the appeal hearing
with Mr Mylchreest on 23 June 2009 was also recorded, but only Mr Mylchreest’s
notes are available [NA1/227-229]. Those notes do record a number of points I raised
about the error in the lottery which I believed was being investigated, and Mr Darvill
raising how complicated the Subpostmaster Contract was. The notes record that I
was shocked about how Post Office was treating me, this is true, because this was
so different from what I had expected. I can see that Mr Mylchreest also made notes
of his decision dated 27 June 2009. These wrongly refer to the decision to terminate
another Subpostmaster in the last sentence.
Following this hearing, I received a letter from Post Office dated 29 June 2009
informing me that the decision to terminate my contract had been upheld [NA1/230-
231]. I have also now seen a copy of this letter dated 29 May 2009 [NA1/232-233],
Again I find it concerning that this letter might have been prepared even before I
attended the meeting with Mr Mylchreest. If it was, then this is the absolute opposite
of what I expected from Post Office prior to contracting in terms of fairness and
trustworthiness.
24
C1/4/24
123. Prior to contracting with Post Office, I just never expected to be in a position where
Post Office terminated. In dealings with Subpostmasters, I expected Post Office to be
fair and thorough. This was not my experience as I have explained.
124. Post Office’s decision to terminate my appointment had very significant effects on me
financially, personally, and on my health.
Comparative Knowledge about Transactions
125. I understand that one of the issues before the Court at the Common Issues trial relates
to relative knowledge about transactions as between Subpostmasters and Post
Office, and I have been shown paragraphs 76(4) to (6) of Post Office's Generic
Defence where Post Office states the alleged limits of its knowledge in relation to
transactions undertaken in branches.
126. I believe Post Office had much better access to Horizon and its features than I did. I
could only input information regarding sales into Horizon and hope it balanced. Post
Office had much more knowledge than me of Horizon and how it operated given that
this was a system introduced many years before my appointment. Post Office also
had more resources, time and people to investigate alleged shortfalls than I did. The
reports I could print were limited, for example for the lottery it was just a printout stating
how much had been processed, but this did not contain detailed enough information
to enable me to understand what was going wrong or why apparent shortfalls were
occurring.
127. I did not receive training about how to access information on Horizon to allow me to
conduct any investigations myself and I didn't receive any relevant training after my
initial training despite asking for it. The advice I was given by my area manager when
I raised problems I was having with alleged shortfalls was that the amounts would
eventually show up. I was not given any practical assistance on how to prevent the
problems I was experiencing or how to identify the cause. I believe my area manager
tried his best but it wasn’t his area of expertise. His responsibility was performance of
the branches, which I think he received commission for.
128. I think that Post Office's practices in relation to apparent shortfalls and transaction
corrections is a good example of the relative difference in access to information
between us. When I was faced with apparent shortfalls, the Helpline advice and
advice from my area manager was that I should pay them back and I had to wait to
see whether a Transaction Correction would then be issued in my favour. It was Post
Office which had the information to decide whether to do this. I had to wait to see what
25
C1/4/25
would happen, I couldn’t carry out my own investigation. I had the same experience
when I was suspended and then terminated, that I was reliant on Post Office to for
example contact Camelot, as Ms Ridge said she would do, but I have seen no
document suggesting that she ever did.
129. It was also very difficult to investigate any problem with cheques, which was an issue
which created lots of transaction corrections as I have described above. Once
cheques were sent off to Post Office, I did not have any records in the branch to
review, so I was dependent on Post Office from that point onwards if they raised an
issue with whether what had been sent matched what had been received and I was
required to accept on Horizon.
130. Of course I had firsthand experience in Branch of the transactions I personally had
inputted, and I could speak to my assistants about the transactions they had inputted,
but my knowledge about why there was an apparent shortfall and whether it was a
real loss to Post Office was comparatively much less than Post Office, who I believe
had access to all transaction data, third party data, and had also had the expert
resources and data available if it had so desired to carry out an investigation.
Interpretation of Section 12 Clause 12
131. I understand that one of the issues before the Court at the Common Issues trial relates
to the interpretation of section 12 clause 12 of the Subpostmaster Contract, and I have
been shown paragraph 93 of Post Office’s Generic Defence where Post Office states
its case as to the proper interpretation of this clause.
132. I was never told this prior to contracting, and don’t think that any Subpostmaster would
contract with Post Office if they really knew that this is how Post Office would interpret
and apply the contract to them. The financial risks would be too big. Subpostmasters
are just not in a position to prove to Post Office they are not responsible for large
sums which Post Office say are losses, and my experience was that Post Office do
not in practice try to investigate the cause of the amounts, their focus is just on getting
them paid by the Subpostmaster.
133. My understanding prior to contracting was that I had to make up minor discrepancies
in branch accounts and that these would arise from e.g. errors in calculating change
due or mistakes in selling a product at the wrong price. I had no idea that Post Office
would seek to rely on my contract in the way it did and was shocked how Post Office
operated the contract in practice.
26
C1/4/26
134. I don’t agree with Post Office’s position that it is fair to infer that a Subpostmaster is
responsible unless the Subpostmaster can prove otherwise, because often the
Subpostmaster does not have relevant information. For example, so far as I can see
Post Office never investigated the issues I raised about the lottery transactions, even
though I knew there was no way they could be correct and I told Post Office this.
135. It also appears to me from the transaction correction data now available to me that
Post Office made errors which affected my branch accounts. I do not agree it is fair to
say it was my responsibility to have to prove this to Post Office, and I never expected
this prior to contracting. I don’t know how many other errors might have occurred or
in different ways, for example errors receiving and processing cheques by third
parties, or errors in the Horizon system that I would not know anything about.
136. During my appointment I had no control over the amounts which Post Office was
posting to my account and holding me liable to pay as alleged losses. On the day of
the audit the amount of the “loss” posted to my account by the auditor in my absence
was £4,905. This included a debit transaction correction which I didn’t know about but
can now see the auditor had accepted. By the date of the meeting I attended on 30
April 09 the amount I was asked to pay was £3,926 (reduced by a credit of £978),
showing that the first number was not a “loss” at all. I do not believe that the £3,926
sum was a real loss to Post Office in particular because of the issues with lottery
transactions I have described above, and which I raised with Ms Ridge and she said
she would look into but I cannot see she did.
137. Post Office chased me for alleged losses after termination of my contract. On 7 August
2009 (three months after my termination on 8 May 2009), Post Office sent me a letter
{E4/86/1} [NA1/234] asking me to pay £692, allegedly arising from a discrepancy dated 11
February 2009. The letter stated that it attached a statement of errors but I do not
think there was any evidence enclosed because I later had to request this.
138. Post Office sent me a further letter dated 26 August 2009 chasing this amount and
stating that Post Office would pass the case to Post Office’s Legal Service Enquiry
Office [NA1/235], {E4/87/1}
139. On 1 September 2009 Post Office sent me a letter [NA1/236] referring to my request {E4/88/1}
by phone for evidence. It says “please find enclosed document as requested by phone
today", but I cannot now recall which document was enclosed. It may have been the
document headed “Former Subpostmaster Statement of Discrepancy” [NA1/237], {E4/76/1}
{E4/63/1} and/or [NA1/238] and [NA1/239], although I don’t now specifically recall. Looking at {E4/62/1}
27
C1/4/27
them now, I can see this was another example of an apparently missing cheque which
Post Office was holding me responsible for.
140. Post Office didn’t provide any other explanation or why it had taken so long to raise
this with me. In the Post Office 1 September 2009 letter it is said “It is probable that
the £978.88 credit that was used to reduce the audit shortage is linked to the £692.32
now due to be paid", but this was completely unexplained.
{E4/89/1-2}
141. Post Office sent me a further letter dated 26 October 2009 [NA1/240-241] which
repeated Post Office’s position that I was contractually liable to pay this amount as a
“loss” and stated that if I did not pay the amount “legal proceedings will be issued
against you forthwith to recover the sum due together with interest and cost’.
142. I don’t think that I in fact paid this amount. It wasn’t clear to me what the amount was
or how it related to the £3,926 I had paid to Post Office on 30 April 2009 (para 199
above). I had no access to information and Post Office had provided only a very limited
explanation to me, which wasn’t clear at all (paragraph 140 above).
Variations to Contract
143. I do not recall Post Office ever writing to me to say that my contract was being varied.
144. I do remember that I was sent (like all Subpostmasters) copies of “Counter News”
which provided information on new products and services that Post Office was offering
and which I was required to provide in branch. These included insurance products,
mortgages, phone cards and a telephone system. Post Office provided me with
information about how much I would receive from the sale of each new product or
service. I did not have a choice about whether to offer these products and services or
not.
145. At some time around the end of 2008 / beginning of 2009, I requested Post Office to
install an ATM outside the branch. This was a service I wanted to provide in the branch
and I thought would increase profit and footfall. This was refused by Post Office at the
time, but after Post Office terminated my appointment I saw they did in fact install an
ATM outside the branch. I didn’t expect prior to appointment that Post Office would
be unreasonable when it came to decisions about products and services, but I think
the fact the ATM was refused during my appointment but installed later shows that
Post Office could have agreed to my request when I made it. I had wanted an ATM to
improve my profits, but was reliant on Post Office’s decision to permit it.
28
C1/4/28
Statement of truth
I believe the contents of this statement to be true.
Signed....
NAUSHAD ABDULLA
Date......
/.P.JM
29

C1/4/29