Mutually Assured Irresponsibility: An Example from the Post Office

A striking feature of many corporate or other scandals is how organisations and their lawyers construct a system of mutually assured irresponsibility. Some of this is done artfully, some without even thinking about it. The problem often, subtly or unsubtly, comes down to this: the client says they did what they did because the lawyer advised them it was legal and the lawyer says they were mere advisers following instructions. Lawyers, too often, and often incorrectly in my view, say they bear no moral or professional responsibility for the acts of clients that flow from their advice. It boils down to this: the client says, my lawyer said I could do it; and the lawyer says, that doesn’t mean I said they should do it. Or, It’s the law’s fault, not mine. Or, bloody law professors don’t understand what commercially savvy legal advisers need to do to make a living these days.

There are two convenient features of this: (1) no one is to blame when the proverbial hits the fan and (2) the factual accuracy of who did what and why lies hidden behind legal professional privilege. Sometimes, as appears to be the case in the Levitt report, when the veil is lifted, the lawyer is seen to be telling the client exactly what the client should do and doing so on shaky legal grounds.

We can see an example of mutually assured irresponsibility in the Post Office case in this letter from Paula Vennells, former CEO to the Post Office, to the BEIS Select Committee in 2020. In this letter she seeks to diffuse responsibility for the Post Office scandal far and wide. Part of that diffusion involves her relying on legal advice:

31. Regarding the question of evidence, first, as I say, it was my understanding from discussions with the in-house legal team and Post Office’s external criminal solicitors that Post Office applied the same procedures and tests as the CPS regarding the collating and consideration of evidence. Secondly, in cases involving technical IT issues, we often obtained input and evidence from Fujitsu (which at the time I believed was acting properly). Thirdly, an additional layer of oversight was provided by the courts and the CCRC. Fourthly, in July 2014, Post Office engaged a senior criminal QC to advise on the response to a letter received from the CCRC regarding convictions relating to Horizon, and also to advise on prosecution related issues. In referring to this advice I do not and do not intend to waive any privilege of Post Office or myself, if any, over the advice the criminal QC gave.

32. As regards the question of what checks were in place to make sure prosecutions were based on sound evidence, the Board and I were assured by in-house and external lawyers that the Code for Crown Prosecutors was being followed and therefore that the first limb of that test (i.e. was there a realistic prospect of conviction on the evidence) was being dealt with properly. Whether the specific evidence was sound in any one case was a matter for their judgment and not mine: it would have been wrong for me to become involved unless of course I became aware of a systemic problem, which I did not. I should add that Post Office was also mindful of its disclosure obligations in relation to convictions. When we went through the Scheme, Post Office lawyers considered each and every case in the Scheme where there had been a conviction in order to assess whether there was anything that had emerged from the Scheme which Post Office was obliged to disclose.

To boil it down, I hope not too much: the lawyers told us it was all okay; and by the way what the lawyers told us is a secret. Unaccountability is assured but my excuses are made.

Now how do the lawyers view it? In the main we do not know, but here we can get a clue from an unlikely source: leading Counsel for the Post Office, Brian Altman QC.* How he would like the world, or at least his clients, to see his involvement in the case is set out on his webpage (on 18 September 2021):

In March 2021, Brian, leading Simon Baker QC, Jacqueline Carey, Charlotte Brewer and Helen Jones (all of 2 Bedford Row), instructed by Nick Vamos and Hannah Laming of Peters & Peters, appeared on behalf of Post Office Ltd in the Court of Appeal Criminal Division in relation to 42 cases referred by the Criminal Cases Review Commission (CCRC) in what was the largest conjoined appeal ever heard by the Court of Appeal Criminal Division (R v Hamilton & Others [2021] EWCA Crim 577). You can read the full judgment here.

The appeals all related to individuals who had been prosecuted by the Royal Mail Group and post-2012 by Post Office Ltd between 2000 and 2013 relying on evidence from the Horizon accounting system which has since been found to suffer from bugs, errors and defects. None of the counsel team, nor Peters & Peters, had been involved in prosecuting any of the cases during this period, and were brought in to conduct a thorough review of the cases to ensure proper disclosure was made and to advise on and conduct the appeals. Leading a team of over 60 review counsel, the counsel team oversaw an enormous post-conviction disclosure review exercise (with over 4 million documents subjected to review and substantially over 300,000 pages of material disclosed) to enable the appellants to advance their appeals.

Following advice from the counsel team, the appeals of the 39 successful appellants had been conceded on grounds of limb one abuse of process (with four of those 39 appeals conceded on grounds of both limb one and limb two abuse of process). Only three of the 42 appeals were opposed on all grounds, and the Court of Appeal upheld all three of those convictions.

Brian and the counsel team have also been advising the Post Office, and continue to advise, on the reviews of hundreds of further convictions in cases prosecuted by Royal Mail Group and the Post Office since 2000.

Funnily enough, if I may engage in a little sport, it doesn’t mention that they lost spectacularly on Ground 2 in 35 (I think) of those cases; nor, if I may return to more serious matters, does it make clear that Mr Altman was instructed in 2013 to advise POL generally on disclosure in the Horizon cases. He may or may not be the same barrister referred to by Vennells as having been instructed in 2014 (she might have the date wrong or be referring to a different piece of work). There is no duty of candour when it comes to our own advertorials, but it is an interesting omission, with Altman’s profile distancing himself from the time when his client was a wrong un’ (“None of the counsel team, nor Peters & Peters, had been involved in prosecuting any of the cases during this period“). I am sure Mr Altman does not think it was him, or his advice, that reassured Mrs Vennells that everything was okay. Indeed, it may not have been. Vennells may be talking about yet another lawyer, or forgetting or, most likely, finessing what happened.

2013 was the same year Simon Clarke, another barrister (then at Cartwright King solicitors) provided two advices to POL: one that spoke of the profound impact on POL’s role as a prosecutor (he thought misleading evidence had been given and material non-disclosure potentially relevant to all cases had not been disclosed) and another which spoke of the abrogation of POLs obligations as a prosecutor and potential perversion of the course of justice. The reviews that Vennells refers to were put in place to correct these problems which, by golly, sound rather systemic. I assume this is why she feels she can say she was not aware [in the end] of a systemic problem; the lawyers, she had been assured, or wants to imply, had given them a clean bill of health. The problems had been cleared up.

As anyone who has read Hamilton will know, those reviews did not do the job. Perhaps the worst example is the case of Seema Misra. She went to prison, pregnant, after a trial which began with a judge refusing her lawyers applications for better disclosure from POL. POL conceded disclosure in her case was inadequate and that her appeal should be allowed. An interesting and important question is why those reviews did not deliver. In discussing why disclosure did not happen in Mrs Misra’s case, Mr Altman says during the Hamilton Hearings,

“We do not know. Was it incompetence?  Was it individuals not understanding their duties?  Or was it deliberate?”

Good questions all. 60 review counsel, one of the country’s leading silks involved as early as 2013, a Court of Appeal hearing of profound importance, to the Sub-Post Masters, to the Post Office, even to the fitness of the criminal justice system more broadly, and still they do not know.

I am not showboating when I say all this not knowing has cost a lot of money. And I am laying a pound to a penny that mutually assured irresponsibility is part of the problem. Any lawyer asked to just paper the bloody deal; or conduct an internal investigation with an eye on their client’s reputation; or who thinks they are being called in to advise as an insurance policy should have the words independence and integrity lighting up in their brain. And that light should be illuminating a cell. And in that cell, should be sitting Mrs Misra. Lawyers are not mere advisers; they have far more power than that, and they must use it wisely.

————

*Actually Professor Dominic Regan very kindly drew it to my attention.

9 thoughts on “Mutually Assured Irresponsibility: An Example from the Post Office

  1. Dear Mr Moorhead,

    Many thanks for a very interesting article which I am going to have to study more closely, particularly given my lack of legal knowledge/understanding as to normal process in the UK.

    However I find Paula Vennels’ comment :

    “Whether the specific evidence was sound in any one case was a matter for their [legal counsel] judgment and not mine: it would have been wrong for me to become involved unless of course I became aware of a systemic problem, which I did not.”

    to be disingenuous and incredible. Did it really not occur to her and any of the other Company Directors that something was wrong when hundreds of Sub-Postmasters (SPMs) were being prosecuted and over a thousand being required to make good cash deficiencies in order to avoid prosecution. How was it that so many SPMs had ‘apparently’ decided to simultaneously engage in ‘false accounting’ ? Were the procedures for vetting new SPMs so flawed that that POL had contracted with so many dishonest people ? In some cases those prosecuted had been SPMs for many years before Horizon and had conducted their affairs correctly – so why did they decide to become dishonest in such numbers ?

    I am still unclear what evidence/opinions the Statutory Auditors provided to the legal team as to how the accounts were being reconciled when what is now known to ‘fictitious cash shortages’ were being reported by Horizon.

    I recognise this layman’s criticism could also be levelled at the legal ‘advisers’ to POL whose ‘common sense’ and focus on justice seems to have been subsumed in a wish to support POL’s determination to deflect attention from Horizon. I have yet to be convinced that this whole debacle occurred solely because of a ‘negative corporate culture’ – I believe the prime motivation, to behave so grievously towards SPMs, has yet to be identified.

    Regards,

    K. Johnston.

    Sent from Mail for Windows

    1. Nothing could be allowed to get in the way of the Royal Mail privatisation. £3.3 Billion for the government and massive bonuses for ALL at the Post Office. They had to delay the bad news just long enough to get the privatisation done. That’s why all the fake mediation and investigation by ‘Second Sight’ was suddenly ended after the Royal Mail had been sold off.

  2. Thank you again, Richard. I remain very proud of the work that Paul and I did representing Seema, Janet and Tracy, who were not prepared to let the Post Office win on limb 2. But It was only the start, and what you are doing is making sure that justice and accountability comes home to the board and the lawyers. I am confident that the senior QC Vennells I refers to is Altman, and the fact that he continues to advise on the remaining appeals is deeply troubling.

  3. I always read these postings with interest . A terrible miscarriage of justice . If you chat to any SPM they will tell you of any number of fellow SPMs who got caught up in this terrible mess.
    Everything is very legally focused but forgive me thinking a little outside the box . What of Fujitsu . They seem not to feature much . What of their relationship with senior PO management both back in 1995 and now? The causation was their imperfect system but have they been held to account for its deficiencies? Has the PO taken any action against them? Do they indeed still supply the software?
    In short have they escaped responsibility?

  4. Paula Vennells wrote. “Regarding the question of evidence… in cases involving technical IT issues, we often obtained input and evidence from Fujitsu (which at the time I believed was acting properly).”

    This strikes me as an evasion of responsibility. What was the basis for Mrs Vennells’ belief that Fujitsu, and Horizon, were acting properly? She should not have relied on assurance’s from Fujitsu. They were hardly likely to tell her that they had developed a flawed system that was rife with problems and which was subject to poor managerial control.

    The Post Office’s corporate governance experts, specifically Internal Audit, should have provided their own assurance that the risks to the corporation were being properly managed and that its IT systems were adequately controlled for the business purposes for which they were required. There were ample contemporary warning signs that should have prompted Internal Audit to dig deeper and tell the board and chief executive how serious the problems were.

    Competent IT auditing of Horizon and Fujitsu’s management would have put Mrs Vennells in a position where she should have said to the lawyers “It has come to my notice that our systems have serious flaws and cannot be relied upon a source of evidence for criminal prosecutions. What should we do now? What are our options?”=

    Mrs Vennells, the board, and the Audit, Risk & Compliance Committee did not get the answers they needed because they did not ask the right questions. I strongly suspect the corporate culture was that the most senior people wanted to be told that everything was ok. They wanted good news, not the truth.

  5. K Johnston raises this point in his comment. “I am still unclear what evidence/opinions the Statutory Auditors provided to the legal team as to how the accounts were being reconciled when what is now known to ‘fictitious cash shortages’ were being reported by Horizon.”

    The statutory external auditors offer an opinion on the truth and fairness of the financial statements. They do not assess whether they are 100% accurate. The auditors are interested only in errors that have a material effect on the corporate accounts. The errors that led to the prosecutions would not have been material in published financial statements rounded to the nearest million pounds. Horizon might have been adequate for the production of the corporate accounts, but it was hopelessly deficient for the management of individual branches, and disgracefully inadequate as a source of criminal evidence.

    I don’t hold the external auditors, Ernst & Young, responsible for the Horizon scandal. I do think they failed to offer an adequate challenge the Post Office’s poor internal control. Specifically, they should have called out the poor performance of Internal Audit. There are all sorts of commercial and cultural reasons why they would have been reluctant to do so. However, it was Internal Audit who should have detected and responded to these problems of “fictitious cash shortages”. The internal auditors should have ensured that the legal team had a good grasp of the true situation.

  6. The comments by Brian Altman QC, cited above, are telling: ‘The appeals all related to individuals who had been prosecuted by the Royal Mail Group and post-2012 by Post Office Ltd between 2000 and 2013 relying on evidence from the Horizon accounting system which has since been found to suffer from bugs, errors and defects.’

    In particular the words ‘which has since been found to suffer from bugs, errors and defects.’

    Any lawyer intending to keep their knowledge up-to-date in order to represent clients in legal proceedings ought to have been aware that I alerted the legal profession as far back as 2010 in the second edition of ‘Electronic Evidence’, that bugs, errors and defects are a normal part of software. I alerted the solicitors representing Seema Misra to this before her trial.

    The fifth edition ‘Electronic Evidence and Electronic Signatures’ (2021) continues to set out very clearly why the presumption that computers are reliable must be changed. Will lawyers now begin to take electronic evidence seriously?

    Stephen Mason

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